Subscribe to our free, weekly email newsletter!


Exclusive Transportation Study: The HOS rule change and trucking operations

Varying estimates from positive to pragmatic existed before the new rule became effective in July 2013. However, the grim reality is that trucking stakeholders are now experiencing substantial losses in productivity due to the change—and in many cases it’s much worse than was predicted.
By Mary C. Holcomb, Ph.D., University of Tennessee; Joseph M. Tillman, TSquared Logistics
July 01, 2014

It’s become clear that trucking executives, logistics managers, and drivers feel that the federal government has created an environment that restrains the flow of freight following a year of living with the new hours-of-service rule (HOS) that became effective on July 1, 2013.

If you rewind 12 months, varying estimates from positive to pragmatic existed before the new rule became effective regarding the impact of the changes. However, the grim reality is that trucking stakeholders are now experiencing losses in productivity due to the rule change—and in many cases it’s much worse than was predicted.

The changes to the HOS rule were established to increase transportation safety related to commercial motor vehicles (CMV). The regulation was aimed at decreasing the amount of CMV accidents due to driver fatigue.

As such, the most impactful change to the HOS rule that became law in 2013 is the use of the restart, which is limited to one time per week—once every 168 hours from the beginning of the prior restart. A compounding effect was the requirement that a valid 34-hour off-duty restart period must include two periods from 1 a.m. to 5 a.m.

According to FMCSA, the costs and benefits of the restart provisions would primarily affect the 15 percent of the 1.6 million over-the-road driving population with the most intense driving schedules.

To ascertain if this was indeed the case, and to gain a better understanding of the impact of the rule change on trucking operations, we conducted two studies. The first took place in October 2013, at approximately the three-month mark to see how well carriers and shippers were adjusting to the new operating environment. The second study was conducted in June 2014 as a follow-up to see if a clearer picture had emerged regarding the impact.

It has indeed, and the news for shippers is not good. A year after the implementation, the shipper outlook has changed from one that projected a possible rate increase between 3 percent and 4 percent to a new projection that the increase could be much higher.

Added to this misery, data from the study show that only about one-third of shippers have experienced any success from working with their strategic carrier partners to mitigate the productivity loss from the rule change. To date, the largest percentage of shippers (34 percent) report a net-neutral position from these efforts.

Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

The Airforwarders Association, which represents more than 360 companies that move air cargo through the supply chain, today applauded an agreement reached by Congressional leaders to advance legislation giving the President authority to conclude key global trade agreements.

Despite great opportunity for growth, the logistics market in Latin America is lagging behind other emerging markets thanks in part to its notoriety for corruption, violence, poor infrastructure and government bureaucracy.

Both the mega-port of Los Angeles, and the Port of Oakland (California's third largest ocean cargo gateway, issued positive reports this month.

The American Association of Port Authorities (AAPA) applauded introduction of The Bipartisan Congressional Trade Priorities and Accountability Act of 2015 (TPA-2015), which is bipartisan legislation to modernize and renew U.S. Trade Promotion Authority (TPA).

Container lines must accelerate their internal-transformation efforts and extract more value from their alliances in order to restore profitability, according to a new report by The Boston Consulting Group (BCG).

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2015 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA