This summer’s hurricanes in Florida and Texas have driven up freight costs to surprising heights, and now with an impending change in how drivers log their driving time, SPC believes that the rates will remain at these inflated levels.
A new federal Electronic Logging Device (ELD) mandate will go live on December 18, 2017, requiring mandatory use of electronic logging devices that connect to the vehicle’s engine to record driving hours rather than traditional paper logs. The current system of paper logs allows drivers to skirt DOT rules and hours-of-service requirements that require rest and time off the road.
These new standards will affect the cost and timing of freight deliveries in the U.S. (and soon, Canada) in the following ways:
- Extended transits:
Transits could increase because drivers will not be able to log as many hours per day, delaying transits. One-day and two-day transits could easily turn into two-day and three-day transits.
- Reduced capacity:
Some carriers will likely run fewer miles, and other carriers could potentially leave the market all together. Both of these factors could combine to create an overall loss of capacity across the truckload market.
- Higher rates:
This reduced capacity might drive up competition and prices.
The following freights most likely affected could be:
- Longer hauls
Freight lanes of 450–600 miles or 900–1,200 miles could see increased transit times, as ELD requirements will enforce existing driving hours per day.
- Unfavorable appointment times
Appointment times that don’t fit within daily ELD time limits of a driver could impact their loads.
- Extended loading/unloading
Warehouses that require more than two hours in loading/unloading a truck could curtail actual driving time, making them less appealing for carriers.
The SPC logistics team has spent many years aligning ourselves with some of the finest carriers and freight forwarders in the country in the service of our clients. We encourage driver safety and adherence to new regulations and will continue to explore all possible options to help mitigate the impact of freight on our customers and our business.