Monday, November 25, 2013

The Trucking Industry's Top 10



Since 2005, the American Trucking Associations has turned to the American Transportation Research Institute (ATRI) to survey trucking industry stakeholders to identify the top issues of concern. And for the 2013 annual survey, there was no shortage of topics for the industry to choose from.

First and foremost were the changes to the federal Hours-of-Service rules which took effect July 1st of this year. Included in the new rules were limitations placed on the use of the 34-hour restart and a mandated 30-minute rest break for drivers before driving after 8 hours on duty. While the safety impacts of the HOS changes have yet to be fully understood, the productivity impacts were immediately felt. Prior to the July 1st changes, ATRI published research which quantified potential impacts from the new rules, including productivity costs to the industry of as much as $376 million annually just for the restart changes. Compared to the potential benefit to the industry of $133 million estimated by the Federal Motor Carrier Safety Administration (FMCSA), it's clear to see why industry had concern.

That concern was not unfounded. On November 18th ATRI released its latest HOS analysis, this time clearly documenting actual impacts on motor carriers and drivers operating under the new rules. Among those impacts: 80 percent of carriers reported a productivity loss; nearly 70 percent of drivers reported pay decreases; and more than 80 percent of drivers reported a negative impact on their quality of life, with 66 percent reporting increased fatigue levels operating under the new rules. The impacts on driver wages alone for all over-the-road drivers could total $1.6 billion to $3.9 billion in annualized loss. These real-world impacts were the subject of a November 21st congressional hearing by the Small Business Committee's Subcommittee on Contracting and Workforce.

But hours-of-service isn't the only issue facing the industry. The industry is still sorting through challenges and conflicts with FMCSA's Compliance, Safety, Accountability (CSA) initiative, now in its third year. Since its nationwide rollout in December 2010, industry groups have identified a number of challenges within CSA. Two of the most significant areas of concern surrounding CSA are the lack of crash accountability in CSA scoring and the inability of CSA scores to accurately predict carrier safety performance. ATRI released research in 2012 found that only three out of five publicly available Behavior Analysis Safety Improvement Category (BASIC) scores were positively correlated with crash rates. The impacts on motor carriers whose safety performance is being evaluated based on BASIC scores with no relationship to crash risk is a problem that must be addressed.

Combined, HOS and CSA are exacerbating an already significant driver shortage. Add to that the increased freight demand resulting from the economic rebound over the past few years and it's no surprise that finding qualified drivers is once again near the top of the list of industry concerns. And though it no longer places first among industry stakeholders, the state of the nation's economy continues to be a top issue in the annual survey, placing 4th in the 2013 list of critical industry issues.

Rounding out the top five issues in the annual survey is the Electronic Logging Device (ELD) mandate. In 2011, FMCSA was forced to vacate a proposed ELD rule due to a court decision regarding concerns over driver harassment. FMCSA is expected to release a supplemental notice of proposed rulemaking (SNPRM) in the next several months that will address ELD performance standards, requirements for the use of ELDs, requirements related to HOS supporting documents, and assurances that ELD mandates will not result in driver harassment. Depending on the nature of the proposed rule, this issue may see a higher level of concern in the future years' surveys.

Issues 6-10 in the 2013 annual survey are all critical and impact motor carriers on a day-to-day basis and the inter-connectivity of the issues is unmistakable. With the recent changes to the HOS rules, Truck Parking (#6 on the survey) has become even more of a challenge for drivers as they look for safe places to park for their mandated 30-minute rest break. Solutions for improving Driver Retention (#7) become increasingly difficult in today's environment with the impacts on drivers from CSA and the HOS changes.

Issues #8 and #9 (Fuel Prices and Infrastructure/Congestion, respectively) impact your bottom line and without meaningful and significant infrastructure investment, congestion will worsen and fuel costs as a percentage of the industry's overall operating expenses will continue to climb. In ATRI's 2013 update to the Operational Costs of Trucking research, fuel and oil was the single highest motor carrier cost center, even more costly than driver wages and benefits combined.

The #10 issue in the 2013 annual survey, Driver Health and Wellness, must become a priority for motor carriers and drivers alike if the industry is going to keep the professional men and women now employed in the industry and attract new entrants. In addition to obvious lifestyle benefits, an improvement in driver health may also have positive implications for industry safety as research has found a positive correlation between driver health and driver safety.

The Top Industry Issues Survey provides an important indicator of where the industry's attention is focused and which issues may rise to prominence in the near future. It's an important tool for providing direction to industry groups at the state and national levels in terms of the issues and strategies that motor carriers believe will have the most impact on the industry for years to come. Armed with this information, state trucking associations and the American Trucking Associations are better equipped to address the issues more broadly and proactively.

ATRI is the trucking industry's 501(c)(3) not-for-profit research organization. It is engaged in critical research relating to freight transportation's essential role in maintaining a safe, secure and efficient transportation system. A copy of the 2013 Top Industry Issues Survey analysis report is available from ATRI at www.atri-online.org

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