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Great Truckers

What do the proposed 2020 HOS changes mean for the trucking market?

On August 14, 2019, the Federal Motor Carrier Safety Administration (FMCSA) released the long awaited draft rule updating certain parts of the hours of service (HOS) rules. Read more to learn about the proposed changes.  

What are the proposed HOS changes?

In summary, the changes proposed include (per the American Trucking Association):

Split sleeper berth

  • 7/3 hour splits would be permissible (current requirement is one continuous 10 hour break with limited opportunities to split into 9/1 and 8/2)
  • Potential for 6/4 split

30-minute rest break

  • The break will be required after eight hours of driving time (as compared to eight hours after coming on duty)
  • The break will be allowed while on-duty, not driving (as compared to being completely off-duty)

Adverse driving conditions

  • On-Duty time can be extended to accommodate two additional hours of driving when encountering adverse conditions

Short-hauls

  • Short haul CDL drivers will be able to operate within a 150 air-mile radius and up to 14 hours (as compared to 100 air miles and 12 hours) without needing to track hours with an electronic logging device (ELD).

14-hour clock

  • A driver will be allowed to “pause” their 14-hour on-duty clock once, for up to three hours during their duty day. This would allow drivers to better plan routes that avoid rush hour traffic or accommodate longer loading times without sacrificing drive time.

When will changes go into effect?

While these changes are a top priority for the FMCSA, we will likely need to wait an additional four to nine months before they issue a final rule.

After that, there will be an implementation time in coordination with ELD providers. Realistically, this change could go in effect as early as January 2020. But the likely timeframe we can expect to see changes is April-July 2020.

Who will be most impacted by the HOS changes?

While the entire market would be impacted by these changes, the dray market could feel the greatest impact. The proposal to extend the short haul exemption by 50 miles and 2 hours per day is likely to result in meaningful per day increases in productivity for dray carriers.

How will the proposed changes affect shippers?

These proposed HOS changes are one of the most aggressive moves to add flexibility in the trucking industry in almost 15 years.

If these changes remain, we could potentially see an increase in available capacity through regulatory change.

Things to keep in mind

Everyone should be reminded this is not the final rule and the details can change. When the comment period closes, there will be lots of anticipation regarding what part of this draft proposal remains intact and which parts may get modified. There also could be court challenges following any final rule that is issued.

Regardless of when the final rule gets implemented, it is clear that the intention of the FMCSA is to provide more flexibility to a driver’s day.

If you would like more information or have questions about the impact on your freight, connect with a C.H. Robinson expert today.

- Director, Government Affairs- C.H. Robinson

Excellence in Freight Transportation: Our 2018 Contract Carriers of the Year

Last week, we at C.H. Robinson had the great pleasure of hosting our 2018 Contract Carrier of the Year Award ceremony in Minneapolis, Minnesota.

2018 Carrier of the Year Award Winners after the awards ceremony at C.H. Robinson

The Carrier of the Year Awards honor some of the most innovative and productive North American truckload carriers in our network. The event recognizes contract carriers who have provided outstanding service; this year’s winners are also leaders in technology use and collaboration with the C.H. Robinson team. It was a true privilege to welcome the awardees to our corporate headquarters, show them around our campus, and host a fun evening celebrating their many accomplishments.

C.H. Robinson’s 2018 Contract Carriers of the Year

We awarded twelve contract carriers—out of our network of over 76,000—in ten different categories. This year’s winners include:

  • Truck owner-operator: Jose Sanchez—Maywood, CA
  • Truck owner-operator: StanTranz—Walkertown, NC
  • 2–10 trucks: Avalon National, LLC—Cassadaga, NY
  • 2–10 trucks: Jeffrey D. Leyk—Burtrum, MN
  • 11–50 trucks: Jack Rust—Rogersville, MO
  • 51–100 trucks: Pope Trucking, Inc.—Pearson, GA
  • 101–299 trucks: A.N. Webber, Inc.—Chebanse, IL
  • 300–999 trucks: Nussbaum Transportation—Hudson, IL
  • 1,000+ trucks: Covenant Transport, Inc.—Chattanooga, TN
  • Flatbed: Cheetah Transportation Systems—Houston, TX
  • Temperature Controlled: Orbitz Trans, Inc.—Riverside, CA
  • Rookie of the Year: DJP Trucking, LLC—Trevor, WI

Celebrating our freight transportation relationships

C.H. Robinson teams and carriers shared many personal stories of working together to go the extra mile during the three-day event. The occasion also offered a chance to step back from the busy day-to-day world of freight transportation and reflect on the essential carrier/provider relationships that make C.H. Robinson’s services so powerful.

“The close relationships we have with our contract carriers are fundamental to the reliable quality that make up our diverse truckload shipping capacity network; these awardees represent many of the most exceptional out there,” said Mac Pinkerton, president of North America surface transportation, who emceed the presentation ceremony.

“We’re delighted to be able to celebrate these carriers that make freight shipping more efficient and more productive for all, and I’m excited to see how we continue to grow together,” he added.

Highlighting first-class freight management all year long

Though our annual ceremony is a special occasion, we’re proud to acknowledge our extraordinary contract carriers every day through our Carrier Advantage™ Program. We created this program to provide carriers with benefits that keep their business moving. The benefits of the Carrier Advantage Program include:

  • A dedicated account manager
  • Contractual freight opportunities
  • Early access to freight
  • Reduced QuickPay program fees
  • Web-offer capabilities

All our Contract Carriers of the Year have obtained Key status, the highest recognition tier within the program. Our Carrier Advantage Program is just one way we at C.H. Robinson keep our relationships central to connect trucks and freight in situations when no one else can.

Please join me in congratulating our 2018 Contract Carriers of the Year!

We’re already looking forward to the stories we’ll hear and the connections we’ll create at next year’s ceremony.

- Vice President of Capacity Development- C.H. Robinson

How to Use Mobile Apps to Improve Driver Experiences and Grow Your Business

Because 2018 was a strong year for carriers in the United States, it fueled an ongoing need for more drivers. In fact, The Cass Truckload Linehaul Index identified 2018 as having the “strongest truckload pricing achieved since deregulation.” This strong demand for truckload capacity, coupled with not enough carriers to meet that demand, led many carriers to seek new solutions and technology—like mobile apps—to help grow their business.

Carrier using Navisphere technology to grow his business

It’s difficult to know what’s on the horizon. Forecasts for 2019 are still hazy. Analysts aren’t sure if the difference between supply and demand will persist throughout the year, which can make planning for your business a challenge. I expect the most successful carriers in 2019 and the years beyond will begin to focus on creating quality driver experiences. Here’s why.

A new focus on driver quality of life

Until recently, focusing on a driver’s quality of life wasn’t often a high priority for carriers or shippers. Now it’s a sign of a quality company poised to succeed.

Historically in this industry, trucks and profit margins have led transportation and supply chain planning. Issues specifically affecting drivers, such as electronic logging devices, shifted some attention toward driver retention, but now, driver frustrations like detention and dwell times—and the lack of respect for truck drivers—are taking center stage.

Instead of putting up with these frustrating issues, smart carriers are collaborating closely with shippers and third party logistics providers (3PLs) to quickly resolve these challenges. I expect this to really change the way carriers and the rest of the industry will operate in the coming years.

Many shippers and 3PLs are already getting on board with this shift. For example, here at C.H. Robinson, we have ongoing efforts to help carriers and drivers reduce routing waste, get respect from shippers, and plan more effectively at a strategic level.

We’re powering these initiatives through data—we collect and analyze information on 120,000 shippers to match premier carriers with collaborative shippers. Together, this combination of data and experience improves carrier efficiency and profitability.

Mobile apps are changing the business

Another change to the marketplace that improves driver experiences has been the rise of mobile freight apps. These apps make it simple for carriers to find and book loads, which makes it easier for drivers to know where they will be—and more importantly, when they’ll be home.

However, because moving freight is so complex, standalone digital freight brokers’ capabilities are still relatively limited in today’s trucking market. Developing freight matching applications that drive profits while keeping costs low requires data, scale, and a deep understanding of the intricacies of freight transport—something only well-established organizations can accomplish.

That’s why we’ve invested in our carrier and driver mobile apps for years and will continue to do so in 2019.

Navisphere® Carrier provides everything owner operators and small carriers need to manage their business while on the road. With this app, carriers can easily find the freight they want, when they want it. And we designed Navisphere® Driver specifically for the needs of fleet drivers, providing automatic status updates throughout the life of a load. Both apps let users upload documents from the road and issue invoices automatically, facilitating perhaps the most important feature of the apps: faster payment processing.

I’ve heard consistently from both carriers and drivers that these kinds of apps are helping them easily and flexibly find, book, and report loads. In 2019, I expect increased emphasis on these types of apps as an easy way to accelerate business growth because they help automate carriers’ and drivers’ most time-consuming tasks.

Technology’s role will only increase

No one can say for sure what 2019 might hold, but as the industry continues to change, I’ll continue to be thinking about the tools carriers and drivers need to streamline and grow their businesses.

As quality driver experiences becoming more and more central, I’m excited to see how technology will continue to improve the industry. Reach out to your C.H. Robinson carrier representative to start that conversation today.

Learn more about our carrier technologies or download Navisphere Carrier from the app store today.

- Vice President of Capacity Development- C.H. Robinson

Analyzing the Impact of the ELD Mandate on Truckload Shipping

ELD Mandate line of trucks in Robinson blueIt’s been nearly a year since the electronic logging device (ELDs) mandate went into effect. Some had predicted that the industry would see mass carrier bankruptcies or a flurry of acquisitions of smaller carriers by larger ones, but that hasn’t been the case. Instead, thanks to the strongest truckload shipping market since deregulation in 1980, the ELD mandate’s effect on the market is playing out in other ways.

The anticipated impact of the ELD mandate

As 2018 got underway, drivers’ hours of service (HOS) didn’t change, but the ELD mandate effectively eliminated any flexibility drivers may have taken with paper logs. With ELDs in effect, lane waste and efficiency could be documented for the first time.

The dire predictions of a year ago were based on traditional truckload shipping market fundamentals, with the usual peaks and lulls. In other words, peak shipping seasons like the holiday rush would be followed by slow shipping periods when there would be an oversupply of trucks. If this had been the market scenario when the ELD mandate went into effect, carriers would have borne the financial consequences of inefficiencies or loss of hours in the market. The result may well have been bankruptcies and acquisitions.

That wasn’t what happened. Instead, there was far more demand for truckload shipping than there were trucks available. Since demand outstripped the supply of trucks, carriers didn’t have to take on the costs of the ELD mandate. They simply passed on the costs, raising their prices to compensate for inefficiencies and loss of hours.

The reality of the ELD mandate

So, what has been the actual impact of the ELD mandate on truckload shipping? It had been expected that with all carriers using ELDs, there would be a way to measure the loss of market hours, but the documentation won’t be accurate until ELDs are in widespread use. As of March and April of 2018, a survey of ELD readiness by MiX Telematics and Bobit Research Services revealed that 29% of fleets that needed to comply with the ELD mandate still had not done so.

In the meantime, a few analysts and others have ventured that the loss of market hours is about 3%. Yet, with demand outstripping truck supply, it’s hard to say for sure what percent of price increases should be attributed to the ELD mandate vs. other freight factors vs. simply “demand is greater than supply.”

It does appear that the ELD mandate could be behind price increases for (formerly) one-day routes of 400-700 miles. Drivers are on the clock for 10 hours per day. But once you’ve accounted for waiting times to load and unload, only 7-8 hours are actually spent driving. Shipments that previously had one-day transit times are now two-day. Carriers have changed rates accordingly to earn the revenue per day they need to be at healthy financial levels.

The same principle applies to dray carriers who work out of the intermodal (rail) terminals. It has always been true of intermodal service that the closer you are to ramps (at both pickup and destination), the better the price will be. That is still true today. But the ELD mandate is causing some of the longer dray destinations to be out of reach with hours of service being managed more critically. The longer dray points may need to be destined to closer ramps that have shorter dray. The trade-off may be in total transit days for the shipment. Intermodal can probably still serve these points, but logistics planners need to consider transit and cost trade-offs.

Final thoughts

As we move into 2019 and more carriers follow the rigors of documentation that come with the ELD mandate, the true impact on the market will become clearer. What seems likely in this economic environment is that we will continue to see higher rates and tight capacity in the near term. Some of the impact of higher rates can be mitigated by working closely with transportation providers, and doing what you can to make your freight more attractive to carriers. Being a favored shipper will continue to pay off. If you need more ideas for working with carriers that fit your unique supply chain, connect with one of our experts.

- Director, Research and Market Intelligence

The Secret to Cutting Costs for Small Carriers

Every business has expenses. And in today’s market, if you’re like most, you’re looking for ways to cut costs wherever possible. After all, lower costs often mean higher profitability. For small trucking companies, cutting costs may seem daunting, but it doesn’t have to be.

Understanding which costs to cut

When looking for areas to reduce expenses you first need to know which expenses to focus on. Each month your business—no matter its size—has two types of costs, fixed and variable. drive down small carrier costs

Your fixed costs (think rent, insurance, permits, cell phone bills, etc.) don’t change a lot from month to month. The other type, variable costs, includes things like fuel, lodging, meals, and repairs. Variable costs are fluid and will shift (sometimes drastically) from one month to the next depending on your business in that time.

While you might be able to get a better deal for some of your fixed costs, focusing your cost reduction efforts on variable costs will likely mean greater results.

Easy cost reduction strategies to get started

Cutting variable expenses starts with small changes in various areas of your business. The order is up to you, but I suggest incorporating one change before moving on to the next.

Fuel efficiency and driving behavior

Because fuel is such a large expense for most trucking companies, it makes sense to find ways to save on fuel whenever possible. A lot of driver behavior can affect fuel efficiency. Speeding can use more fuel, while reducing idling can save it.

Maintenance rather than repair

Trucks are complex machines. A lot can go wrong if they’re not properly maintained. And normally such repairs are costly. While it may seem counterintuitive to spend money maintaining your equipment, it can actually save on repair costs down the road.

Emphasize safety always

Promoting safety not only saves money, it can save lives. The cost of an accident can add up quickly, especially if there are injuries. Safety education—from winter driving techniques to ways to avoid back injuries—goes a long way in reducing high accident, citation, and insurance expenses.

Food and lodging budget

Eating and sleeping on the road can add up quickly, not to mention rough on drivers’ health. Some drivers add a refrigerator and/or a bed to their cab to help cut down on these kind of expenses. If that’s not feasible, setting a budget and sticking to it can also help.

Tracking your cost reduction progress

You can change many areas of your business, but the only way you’ll know if your cost reduction efforts are successful is if you have an accounting process to clearly show you the results of your actions. I believe an accounting system is the critical piece to small carrier profitability, and one area that drivers often overlook.

Define your own system

Whatever method of accounting you choose—software, an accountant, or some combination—make sure you choose an option that’s easy, simple, and maintainable. I often recommend developing a process of sorting receipts when you get them and then processing them on a monthly basis.

Working with a 3PL can also help streamline your accounting process. C.H. Robinson makes the accounts payable process fast and easy so you can seamlessly incorporate it into your overarching accounting strategy.

Run your business by the numbers

Most importantly, your accounting system must be powerful enough to offer reports so you can use your information to find areas to improve. After all, in order to achieve better results to you need to take better actions.

- Founder and CEO, LetsTruck