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01/10/2018

Electronic Logging Device (ELD) Impact on the US Domestic Trucking

 

Dear Valued Customer,

 

As of December 18, 2017, the Department of Transportation (DOT) began implementation of the Electronic Logging Device (ELD) mandate. Designed as an enforcement of the Hours of Service (HOS) rules published by the DOT, ELD will now replace truckers manual logbooks to ensure that drivers have had sufficient rest before getting behind the wheel. The installation of this device allows regulators to monitor truck movement and driver activity with greater accuracy than manual logbooks. 

 

Why ELDs?

The Federal government has determined that driver fatigue is a leading cause of accidents involving trucks. New Hours of Service (HOS) rules are therefore being introduced to ensure that drivers have sufficient rest. ELDs will make it much easier for the government to enforce HOS rules.

 

What are the Hours of Service (HOS) rules?

11-Hour Driving Limit:  A driver may drive a total of 11 hours before they are required to take a 10-hour break. It is important to note that only time spent driving will count towards the 11-hour mandate.
14-Hour on Duty Shift Rule: A 14-hour count will begin as soon as a driver starts their day and changes their status to On Duty or Driving. The 14-hour clock WILL NOT stop ticking regardless of Off Duty or Sleeper status. After the clock has hit 14 hours the driver is required to take a 10-hour break before driving again.
70 Hour in 8 Day Rule (or 60 in 7):  The total time spent by a driver in the On Duty or Driving status may not exceed 70 hours in 8 days (or 60 hours in 7 days depending on the variation chosen by the trucking company).
8-hour, 30-minute Break Rule: Every 8 hours, a driver is required to take a 30-minute rest break and change their status to Off Duty or Sleeper.
Short-haul exemption: A driver that consistently operates within 100 air-miles (about 115 miles) of their base may be exempt from the ELD logs altogether. However, they are still be required to log hours manually, and there will be numerous restrictions on qualifying for this exemption.
 

How will this impact trucking rates?

Whereas in the past driver HOS logs were kept manually and susceptible to fraud, ELD HOS logging is a much stricter system with less room to "bend" operational hours to meet the tight delivery scheduling demands. 

For example, if a driver waits four hours to pull a container from the terminal, those hours will count against their 14-hour total, potentially increasing the frequency with which pre-pulls will be required and thereby increasing costs.

 

How much will trucking costs increase?

Many truckers, particularly the smaller companies that dominate the drayage business, don't yet have a grasp as to how HOS enforcement will impact their business model and thus their pricing. Data is currently being collected to assess the impact of these rules. Conservative estimates range between a 5-20% increase but may be more.

 

What will happen in the near term?

Incidents such as truckers refusing or reneging on loads due to drivers hitting their maximum hours as well as much more frequent requests for pre-pulls are to be seen in the near future.

 

Is it possible to use truckers (for short-hauls) with the exemption?

OEC Group will do our best to utilize truckers with exemptions for short-haul lanes, but those truckers with short-haul exemptions will likely become more expensive as demand for their services increase.

 

ELD, Not the Only Issue Plaguing the US Trucking Industry

In addition to the uncertainty over ELD implementation, there has been a number of long standing issues afflicting the US domestic trucking industry.  These include, but are not limited to, a nationwide driver shortage, an increase in the volume of imports and infrastructural inefficiency at the US ports exacerbated by Ultra Large Container Vessels (ULCV) cascading into the trade. 

 

OEC Group is working closely with our preferred vendors to minimize the impact by ensuring that they are familiar with the new rules and our services are not disrupted. We will continue to monitor this situation and provide updates accordingly.

 

For additional insight, please refer to the following:

https://www.wsj.com/articles/tight-trucking-market-has-retailers-manufacturers-paying-steep-prices-1515150000

 

Should you have any questions regarding this update, please contact your Sales or Customer Service representative at OEC Group.

 

 

Sincerely, 

 

OEC Group
 

 

The information contained herein is provided as a public service with the understanding that OEC Group makes no warranties, either expressed or implied, concerning the accuracy, completeness, reliability, and suitability of the information. Nor does OEC Group warrant that the use of this information is free of any claims of copyright infringement.

http://www.oecgroup.com
 

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