What Are ELD’s and How Are They Impacting Truck Capacity?

by Marketing | Jan 24, 2018 | News

What are ELD’s?
For anyone not familiar with the term, ELD is short for electronic logging device. This tool is used to document a driver’s Record of Duty Status (RODS). Before ELD’s came about, drivers had to manually enter their hours of service into a paper logbook. Although some individuals still utilize this method, ELD’s were created with the intent to be easily accessible, organized and a fast way to track, manage, and share RODS information. The device is able to connect with a truck’s engine, which transfers driving time directly to the ELD, making it easier and accurate for drivers when having to log their hours of service requirements.

The ELD Mandate
About six years ago, in 2012, the U.S. Congress passed the MAP-21 bill, otherwise known as “Moving Ahead for Progress in the 21st Century.” This law requires drivers to have an ELD installed in their vehicle, replacing the previous manual logging method. The mandate was put into action in December of 2017, but drivers have until April of 2018 before the FMCSA (Federal Motor Carrier Safety Administration) requires them (inspectors will issue citations before April 1; after that date, out-of-service orders will be given to truckers that are non-compliant).

Impact on Truck Capacity
The new ELD Mandate has raised issues concerning trucking capacity and much more. Although truck operators have known about this for a while, many have yet to install the electronic tracking device or find an authorized vendor, not to mention it is a lengthy process.

Based on FMCSA guidelines, the HOS rules are as follows:

• Truckers have an 11-hour driving limit (only holds true if the driver has 10 consecutive hours off duty)
• Drivers have a 14-hour absolute driving limit for driving after coming on duty (following 10 consecutive hours of off-duty)
• Drivers must take breaks (may only drive if 8 hours or less have passed since the end of the drivers last off-duty)
• Specification of how many hours a driver may work within an 8-day period
  • No more than 60 hours when driving 7 consecutive days in the same period
  • No more than 70 hours when driving 8 consecutive days in the same period
  • Restarts when the driver takes 34 + hours off duty

These new regulations hold strict limitations on the number of trips and hours drivers can complete in a given time frame. They also have drivers questioning what this means in terms of trucking capacity. Will truck drivers be able to fulfill their daily driving schedule? Will this decrease a carrier’s or operator’s profitability? As truckers are faced with increased costs and limited driving time, how much of these increased costs will be passed on to shippers?

Many media outlets are already reporting significant capacity constraints and rate increases across both the truckload and LTL segments. In fact, some truckload freight may be shifting to LTL in certain lanes as capacity has tightened and as truckload spot-market rates have increased. The TIA’s (Transportation Intermediary Association) data is also showing the impact of rising spot market truckload rates, which grew by double-digits year over year in the fourth quarter of 2017.

Although 3PLs are not immune to rate increases and capacity crunches, they are often in a better position to help customers find affordable solutions through their effective use of technology and their expansive carrier relationships.

There is no doubt that the ELD mandate will cause less trucking capacity, but in the long term, it will increase efficiency and productivity for users who implement it. Since the large fleet operators have implemented ELD’s years ago, they have an advantage over the smaller fleet and independent operators who have delayed ELD implementation. However, Logistics Plus is accomplished in finding the best logistic solutions to a shipper’s needs.

ELDs, new visibility tools, and automated enhancements will continue to change the transportation and logistics industry on every front. As costs are permanently reduced and efficiencies realized, the trucking industry may eventually see a prolonged period of price declines. However, that time horizon is at least a few years away. In the meantime, if you need a trusted logistics partner to help you find affordable truck capacity, Logistics Plus is ready to help.