ELD mandate to reveal ‘fudge’ in trucking industry hours of service requirements

by Jeff Della Rosa ([email protected]) 758 views 

Semitrailer drivers and carriers will be challenged to maintain productivity when they adapt to electronic logging devices (ELDs), but they also might find the devices more difficult to cheat when it comes to logging hours of service.

Nationwide, 40% of trucks are compliant with the mandate, said Shannon Newton, president of Arkansas Trucking Association. Large carriers switched to the technology three or four years ago. The ELD mandate is the No. 1 issue on the top 10 list of issues the trucking industry faces, according to the American Transportation Research Institute. The mandate goes into effect Dec. 18, requiring drivers to track hours of service using an ELD, instead of paper logs.

The ELD mandate will determine how much “fudge” is going on in the industry, said Steve Rush, owner of Carbon Express, who spoke in a recent Transport Topics video on the mandate.

“I’ve heard estimates as high as 40%. If the fudge was that significant then this is going to be very tough to handle,” Rush said.

In his driving career, the 40% wasn’t a bad estimate. Life lessons and the transition to electronic logs, “told me the errors of my way.” Before ELDs, “I just fixed the paper accordingly, and that was wrong. It’s a significant safety factor. … There’s never been a way to police this industry. I mean go all the way back to the Pony Express days. So now we have a way to police it.” He expects prices to go up and foresees a “significant problem in covering loads.”

Allen Boyd, a driver for Wal-Mart Stores, who also was in the Transport Topics video, explained that in order to reduce the impact on capacity, “we have to have a whole different mindset and not just drivers or trucking companies but shippers and receivers … If those folks want their products moved they’re going to have to start jumping on board with this whole hours of service.”

Newton agreed that shippers and receivers need to take into account the drivers who must meet hours of service requirements. Schedules have been structured “without regard to drivers’ hours of service,” and with paper logs, drivers might have had to adjust their logs to meet the hours requirements. But with the ELD mandate coming into play and logs being tracked electronically, drivers won’t be able to adjust their hours to “make it work.”

While some drivers might resist changing to ELDs, “drivers who have had it don’t want to give it up,” Newton said. “It’s almost like a verification system.”

As a result of the mandate, analysts expect capacity to decline, yet in the long run, the reduction is expected to lead to improved pricing and industry consolidation.

“For carriers currently running in excess of legal limits (some of whom are estimated to run over hours by as much as 50%), becoming compliant will negatively impact productivity (both due to less miles and implementation hurdles), limiting over industry trucking capacity (available miles,)” according to a report by transportation and logistics analysts Benjamin Hartford and Zax Rosenberg, both of Robert W. Baird & Co. “As a result of both the temporary and permanent productivity reductions, we expect attrition of smaller carriers into 2017.” Larger carriers, who already have ELDs installed, “will enjoy the benefits of reduced industry capacity as smaller carriers either leave the industry in response to the outlook of reduced productivity in late 2017 and/or struggle to meet the demands of the mandate.”

Capacity will be reduced in the “mid-single digits industry-wide,” but some carriers expected the reduction to be as high as 10% after installing ELDs in trucks, according to trucking/transportation analyst Brad Delco of Stephens Inc. ELDs are expected to “more effectively and efficiently track a driver’s hours-of-service duty status, while helping to prevent the intentional falsification of records.” ELDs will level the “competitive playing field” and give “no carrier a distinct advantage over another due to falsifying log books.”

The mandate has the support of the American Trucking Associations and the Arkansas Trucking Association, but Owner-Operator Independent Drivers Association is fighting the mandate and has filed a petition to the U.S. 7th Circuit Court of Appeals to reconsider the mandate. The court had previously denied a request to rehear the case, and analysts expect similar results again, with the mandate going into effect as planned.

“The government’s excuses for mandating electronic logging devices are weak and fail to justify violating the Fourth Amendment rights of professional truck drivers,” according to the Owner-Operator Independent Drivers Association. Association spokeswoman Norita Taylor said ELDs are not more reliable than paper logs “because they still require manual input from the driver. The only thing an ELD does is track movement of the truck and its location. The driver is the one that has to report what is called record of duty status…An ELD does not automatically record that information.”

“ELDs are not an automatic ‘tamper-proof’ device for accurately recording HOS compliance,” said Norita Taylor, spokeswoman for Owner-Operator Independent Drivers Association.

Taylor said drivers must manually enter when their duty status changes to off-duty or on-duty not driving.

According to International Roadcheck 2016, 16.4% of drivers cited for out-of-service violations were for a false log book, while 46.8% of the violations related to hours of service. International Roadcheck 2016 was a three-day event in which inspectors, certified by Commercial Vehicle Safety Alliance, conducted 62,796 inspections on big rigs and buses across North America.

The mandate was projected to affect 3.4 million drivers, according to the Federal Motor Carrier Safety Administration. The cost of ELDs range between $116 and $419; however, ongoing subscription fees are about $300 annually, resulting in an expected annual cost of $975 million for the trucking industry, according to the Department of Transportation.

Fleet management software and ELDs will cost $1 billion and another $600 million for new drivers and vehicles. Carriers that already have automatic onboard recording devices (AOBRDs) will have an additional two years after the Dec. 18 deadline to comply with the mandate. Some of these devices need only software updates to comply, but the older devices likely need to be replaced with ELDs.