ELD's and the impact on the Fresh Produce Supply Chain

September 5, 2018

 

The new ELD Mandate has been in effect for nearly 9 months now.  It has been roughly 5 months since the hard enforcement date of April 1st compliance.  Days before the 90-day electronic logging device waiver expired, the The Federal Motor Carrier Safety Administration (FMCSA), an agency within the United States Department of Transportation that regulates the trucking industry, announced that hours-of-service rules don’t start until drivers have traveled 150 air-miles away from pickup points.   

 

As with any new legislation, there has been some confusion on how this new ELD Mandate would be applied to the many different sectors within the transportation industry.   Even more confusing has been the personal conveyance rule that allows a driver to operate a commercial motor vehicle in an off-duty status if the reason for the operation is personal in nature. This can include going to get something to eat or shop, or to visit relatives. It doesn’t include, though, trips home after dropping off a load.  What is clear though, the impact of the new mandate does not necessarily impact all sectors equally which is articulated in a recent article in the Produce News.

 

"These rules did not take into consideration that the trucking industry is not uniformed, and the agricultural industry is especially unique," said Evan Kazan, director of business development for Target Interstate.  "The initial rule required dramatic changes to long established business practices, and they needed to be implemented in a relatively short amount of time.  We anticipated there to be requests for exemptions to be made.

 

Driver Productivity and Efficiency

 

Waiting time is still a big concern for trucking companies, according to Kazan.  In the past, the common metric used by carriers to determine efficiency and breakeven analysis was dollars per mile.  "Companies wanted to maximize the number of miles per day, and the hours-of-service wasn't as big of an issue," he explained.  "With the ELD mandate, the bottleneck isn't the driver's physical capabilities and miles in a day, but time management.

 

Therefore the newer metric of efficiency is dollars per hour.  Drivers have 11 hours of driving to make as much money in a day as possible.  Adjustments, Kazan pointed out, are alreday being made on the shipping end with many shippers moving to an appointment system to cut down on wait time, but on the receiving end of things have mostly remained the same.

 

“It’s a cliché, but ‘time is money,’ and if the entire supply chain can work together to decrease the driver's non-productive time, costs should decrease" he said.

 

Anything receivers can do to help drivers manage their hours more efficiently will help keep costs down.  Kazan said that there are new technologies available that customers can utilize to track their shipments in real time and increase transparency.

 

Further, if receivers can narrow their unloading windows into three to four hour time slots, drivers would be able to manage their hours better and pass the savings along to the customer.

 

Also driving during peak traffic congestion is not an efficient use of the driver's time.

 

"If they can remain off-duty for a few extra hours and avoid some of the heaviest traffic they can be more efficient with their time," said Kazan.  "Drivers are building these obstacles into their prices anticipating losing time and money during the trip.  Anything to lower these obstacles will lower costs."

 

Trucking fresh produce has definitely become more challenging than in years past, but adjustments can be made to counteract some of the difficulties.  Kazan said the ELD mandate in conjunction with shortage of carrier capacity has allowed truckers to more particular in the types of loads they want, from the number of pickups, to the destination and transit times.

 

"The more flexible customers can be, the more successful they will be in getting trucks at attractive prices." he added.  "Eventually everyone will adjust to the market conditions and people will have a new norm of doing business."

 

 

 

 

 

 

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