Carriers Raise Rates to Make Up for HOS Losses

HUMMELSTOWN, PA— Truckload carriers are not raising their rates high enough to cover their productivity losses from the HOS rules, DAT analyst Mark Montague wrote in a blog post.

Since the rule went into effect July 1, truckload rates increased from 1.6 to 1.7 percent, Montague wrote.

That’s the right idea, but considering the estimates that the rule will reduce productivity by three to five percent, carriers are not getting ahead of the cost of the rule.

“That means the carriers will be ‘eating’ about half of the revenue loss (from the rule), at least until they can negotiate new contract rates for 2014,” Montague wrote.

New contracts typically are negotiated in the first period and implemented in the second, he said.

Read his blog post here. 

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