Trump nominee backs ELD mandate, P.A.M. opts for AOBRDs to comply with mandate

President Donald Trump’s nominee to lead the Federal Motor Carrier Safety Administration supports the mandate requiring drivers to use electronic logging devices (ELDs) to track hours of service, and Tontitown-based carrier P.A.M. Transportation Services has determined it will equip its fleet with automatic onboard recording devices (AOBRDs) to comply with the mandate.

Ray Martinez, the president’s nominee to lead the federal agency, told the Senate Commerce Committee he wants to meet with small independent truckers to learn their concerns about the mandate after hearing it would negatively impact them, but at the same time, he ensured the mandate would be carried out by the agency he would oversee. He explained ELDs are needed to promote accurate record-keeping of a truck driver’s hours of service information, according to Transport Topics, a publication of American Trucking Associations.

“What we experienced in the past was that it was paper-based, which means it was very susceptible to fraudulent entries,” Martinez said.

The Commerce Committee is expected to vote on whether to approve Martinez’s nomination by the end of the year.

Along with equipping its fleet with AOBRDs, P.A.M. will give its owner-operators a free AOBRD, according to a company blog post.

“At PAM, we’ve done the research and are going with the AOBRD option, which seems the safest bet to keep our fleet rolling without any interruptions,” the blog noted. “As a matter of policy, we outfit all our owner-operators with AOBRDs — QualComm MCP50s — for free and don’t charge a rental fee.”

The ELD mandate will require all drivers who use paper logs to track hours of service information to start using an ELD to do so Dec. 18, but switching to an AOBRD before the deadline allows drivers to use those devices through Dec. 16, 2019, before complying with the ELD mandate.

The blog shows three options to comply with the mandate, including downloading a smartphone app with an electronic logbook and purchasing an ELD or AOBRD. The first is the “riskier” approach to comply with the mandate, the second is “risky,” and the third is the “least risky,” according to the blog.

“Most modern AOBRD devices can be turned into ELDs with firmware or software updates.”

ELDs that are listed as registered devices on the Federal Motor Carrier Safety Administration’s website are registered by the ELD provider.

“The Federal Motor Carrier Safety Administration does not endorse any electronic logging device,” the blog shows. “None of those devices have been officially approved by the FMCSA.”

Over the next two years, carriers will have the opportunity to determine how the devices work in the field and if they are compliant. FMCSA has established a website for ELDs that have had their self-certification revoked.

“Bottom line: opting for an ELD device before any are tested in the field and subjected to DOT scrutiny does not sound like a very secure option,” according to P.A.M.

John Larkin, trucking/transportation analyst for Stifel, expects some carriers won’t install ELDs until April 1, when non-compliant trucks will start to be placed out of service.

“They will take the risk, in so doing, running up a series of citations and fines, which will adversely impact their CSA scores.”

Other carriers will operate with ELDs to see if they can “remain economically viable at today’s spot rates while running legally. If they can, they will in theory operate as long as the spot rates remain elevated. Otherwise, they will ‘pack it in’ temporarily or in the case of some older drivers, exit the industry once and for all.”

In the quarter that ended Sept. 30, P.A.M.’s earnings were flat at $3.446 million, or 54 cents per share, from $3.451 million, or 53 cents per share, in the same period in 2016. Revenue, including the fuel surcharge, was flat at $108.898 million.

Shares of P.A.M. (NASDAQ: PTSI) closed Wednesday (Nov. 1) at $29.64, up 37 cents. In the past 52 weeks, the thinly traded stock has ranged between $29.80 and $14.50, and on Oct. 27, the carrier’s stock reached its 52-week high.