Are private fleets about to hit a wall?
March 01, 2011
The trucking world is about to be turned on its regulatory head. An aggressive and costly new truck safety agenda is being rolled out this year by the Obama administration that promises to increase costs for all fleets. Carriers will have to spend more on equipment, personnel, and planning in order to comply with the new regs.
While few are disputing that the potential changes in trucking enforcement will toss the “bad apples” out of the bushel of 4 million truck drivers, the cost of making the highways safer for all of us will eventually be paid through higher driver wages that carriers will be offering to a diminished pool of available, qualified, legal drivers.
CSA stands for “Comprehensive, Safety, Accountability,” a program that’s being rolled out in earnest over the course of 2011. It’s a new initiative designed to improve the efficiency of the Federal Motor Carrier Safety Administration’s (FMCSA) enforcement and compliance program to achieve the agency’s stated mission of reducing commercial motor vehicle crashes, fatalities, and injuries.
How big of a change is this? American Trucking Associations’ President and CEO Bill Graves has called CSA potentially the biggest change in the industry since trucking was economically deregulated in 1980.
Scott Willert, senior manager of private and dedicated fleets at Kraft Foods, calls CSA “a very significant change” in the way truck safety is measured and monitored. In fact, Willert says it has the potential to greatly reduce the availability of qualified drivers at Kraft, which operates more than 2,500 power units and 1,100 trailers. Willert says Kraft Foods “fully supports” the new initiatives because of their overall benefit to highway safety, but acknowledges the new system will be more complex, and expensive for all carriers.
In a nutshell, CSA uses a new safety measurement system that’s more comprehensive and is better able to pinpoint specific violations to better identify high crash-risk behavior by drivers. It involves more interventions, and a wider range of inspections to try and match the government’s enforcement efforts with fleet safety performance levels.
By their very nature, private fleets have a huge advantage over the for-hire sector when it comes to CSA 2010, industry officials and private fleet operators say: Their more stringent hiring and operational procedures are already in place.
“We don’t think CSA will be a big problem for our members,” says Gary Petty, president and CEO of the National Private Truck Council. “When there’s an economic turnaround, truck capacity may not be available to shippers at any price. So, from the private fleet perspective, we feel that this has a pretty positive outlook.”
The second half of the double-whammy about to hit trucking is proposed changes on the HOS rules. A highly-charged political issue, HOS has the potential to reduce available truck capacity by about 9 percent if the legal daily limit on driving is reduced from the current 11 hours a day to 10 hours.
“A change in the HOS rules is going to have some effect on how we operate,” says Greg Whisenhant, a 16-year industry veteran and transportation safety manager for Shaw Industries, a Dalton, Ga.-based floor covering business that operates a sizable private fleet consisting of 900 drivers and 1,400 power units.
“We won’t be able to get as many drop offs in a day if we went back to a 10-hour driving day,” Whisenhant says. “It’s going to be a financial hit in some lanes where we now run single drivers, but might have to use a team operation. Teams are a tougher dog.”
In a typical Washington move, the federal government has not actually ordered such a reduction, at least not yet; although FMCSA has indicated it would like to make that change. According to our reporting, the trucking industry is united in wanting to maintain the current 11 hours, though there will likely be reductions through greater mandatory off-duty time and other driving limits.
Again, while the private fleet sector is not immune from these changes, private fleet operators say that any changes in HOS will be mitigated by the very high-service, high-cost nature of fleet operations.
So, what are the top private fleet managers doing to help mitigate the costs of these expensive new regulatory initiatives? Logistics Management found some of the best private fleet operators and most knowledgeable industry insiders to discover how they’re preparing their operations for this ongoing one-two regulatory punch.
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