I spent the better part of last week in Dallas, attending the first annual Commercial Vehicle Outook Conference. It was a good conference, with a wide range of respected speakers from industry representing OEMs, carriers and freight forecasters.
The overall tone of the conference was upbeat. Industry analysts feel the industry is headed in the right direction, despite waning consumer confidence and a slowdown in housing starts. When it gets right down to it, it’s freight volumes that matter most, and they are trending up in virtually every mode, presenters at the conference pointed out.
But the road ahead is not without its bumps. There were two concerns weighing heavily on the minds of fleet executives who spoke at the conference. One is that US hours-of-service will, in fact, be reduced as early as this fall. Perhaps I’m naïve. I thought the current review was Obama’s way of placating special interest groups who had challenged the current rules, claiming they are unsafe, and that after a thorough review no substantial changes would be implemented. After all, highway and truck safety have both improved under the current HoS rules, so they can’t possibly be a concern. Looks like I was wrong on that one. Industry reps at the conference seem resigned to the fact that US hours-of-service will be reduced by one or two hours per day and the 34-hour reset could even be extended to 48 hours.
“The hours-of-service rewrite is a political football and it will have nothing to do with good science,” said ATA chairman Tommy Hodges, who also runs Titan Transfer. “It’s a political football that is going to get passed over our heads. There’s a good possibility we will lose one to two hours of driving time and there’s a strong possibility we’ll lose the 34-hour restart.”
Losing two hours of driving time per day would be a 18-19% productivity hit in the trucking industry, including for those of you running into the US. Fleet executives on-hand said it will require a change of mindset; trucking companies will need to start measuring productivity based on time, not miles.
A possible reduction in legal working hours for truck drivers may be compounded with what was predicted at the conference to be a driver shortage of unprecedented proportions. It’s possible CSA 2010 may make up to 200,000 current drivers unemployable.
“This industry historically thinks in terms of miles,” said Tom Kretsinger, president and CEO of American Central Transport. “I think one of the key measures will have to be time. What percentage of this limited time can we put to good revenue use for us and the driver.” (Another sign that a shift towards hourly pay for drivers is gaining momentum?)
As for CSA 2010, there’s growing recognition that the safest, most compliant drivers will have an Ace up their sleeves when it comes to partnering with the best carriers and commanding top rates. I’ve wondered, aloud at times, whether we’ll see tiered pay packages based on the CSA 2010 scores a driver brings to a carrier. It may happen.
Hodges referred to CSA 2010 as the ‘Free Agency for Drivers Bill.’ He said the safest drivers will be like a free agent pro athlete, able to offer their services to the highest bidder, knowing just how important a driver’s CSA 2010 score will be to his/her employer.
“A driver who knows he’s got a good record, knows how to abide by the rules and knows his value to my company, he’ll say ‘look at my score, you’re going to pay me 50 cents/mile or I’ll go over to XYZ and they will,” Hodges predicted.
Kretsinger took it a step further, saying “I’m not managing this company at the moment. The drivers are, because they’re in short supply.”
A potential reduction in legal working hours, coupled with a driver shortage that’s already becoming evident, combined with a possible purging of existing drivers brought on by CSA 2010, could result in a major capacity crisis, presenters said. Several said there will be instances where freight sits undelivered on shippers’ docks. It will be fascinating to see how it plays out over the next couple of years.
James Menzies is editor of Truck News magazine. He has been covering the Canadian trucking industry for more than 15 years and holds a CDL. Reach him at firstname.lastname@example.org or follow him on Twitter at @JamesMenzies. All posts by James Menzies