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Fleet Focus: ELDs push drivers to find ways to remain ‘productive’

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trucks and cars in traffic
Prior to ELDs, two hours stuck in traffic went down as a half-hour driving and an hour-and-a-half break at the truck stop, or the start time was simply adjusted to show beginning the trip much later. (The Trucker File Photo)

The crescendo has passed, but the symphony of protest against electronic logging devices (ELDs) is far from over. Despite the objections and barring a legislative turnaround of epic proportions, ELDs are here to stay.

Whether the claims of enhanced safety provided by ELDs prove true, and so far they have not, carriers have a vital interest in protection against the “nuclear” verdicts being handed down in courtrooms. With paper logs, they had less control over the driver’s actions. Hours of Service infractions and falsifications that could potentially seal a verdict against the carrier might not be discovered until weeks afterward, when the logs were sent in. And, if the driver was good enough at “creative” logging, those infractions might not be discovered at all.

Full disclosure: during a driving career, the writer may or may not be responsible for years of near-perfect duty status records that may or may not have been routinely (and beautifully) falsified.

For most drivers, and especially owner-operators, it was important to “preserve” as many driving hours as possible in order to be productive (and profitable). So, two hours stuck in traffic went down as a half-hour driving and an hour-and-a-half break at the truck stop, or, the start time was simply adjusted to show beginning the trip much later. Recorded driving hours were calculated by dividing miles traveled by a reasonable “average” speed, usually five or so miles below the posted speed limit — but only when the result was fewer hours than actually spent driving that distance. Daily hours didn’t start until the truck was nearly loaded, foregoing the short drive from the truck stop and hours of waiting.

ELDs have greatly reduced infractions and falsifications, and made it easier for
carriers to identify those that still occur much sooner. Some will say that ELDs can still be falsified, but it’s also easier for both carriers and law enforcement to monitor.

What has happened is that ELDs have brought to the surface something that drivers have known for decades — industry abuse of the driver’s working time has been rampant and mostly ignored. It’s amazing how many carriers suddenly became concerned about driver “productivity” when ELDs made it more difficult for drivers to “hide” non-productive hours. Dispatchers are no longer able to give wink-and-nod direction to “just do the best you can,” trusting
the driver to make the paper logs look right.

With ELDs in place, drivers and owner-operators need to find other ways to remain productive. That action might include becoming much more assertive when it comes to control of those available hours.

Refusing dispatch, for example, is a legal descriptor of being an independent owner or contractor. Drivers should consider more than just miles and compensation rates when a load is offered. For example, loads traveling shorter distances are often less productive, especially when there’s a pickup and a delivery on the same day. The rate per mile offered should be greater than for longer loads.

Potential traffic should be considered, too. A pickup scheduled for 8 a.m. in the center of a large metropolitan area virtually guarantees waiting in traffic congestion, whereas a pickup in a suburb, or in a smaller city, might get the driver in and out much faster.

Customers who routinely take excessive amounts of time to load or unload can and should be avoided. Even if the customer or carrier pays for detention time, the amount is often far less than the driver earns during hours spent driving down the highway.

In a world where compensation is usually calculated by the mile, drivers are often unaware of how their settlements equate to hourly pay. They shouldn’t be. Owners should keep a record of the total time spent on a load as well as compensation received. A load with 10 hours of driving that is loaded in an hour and unloaded in an hour means 12 hours invested. Make it four hours to load and four more to unload, and the time investment becomes 20 hours. Divide the revenue received by the time spent (12 hours or 20) and the resulting earnings per hour may differ greatly. The answer may be good to know the next time that load is offered.

Managing a trucking business, even a one-truck outfit, is often a series of trade-offs. Owners must sometimes accept a not-so-good load to get in position for a better one or to get to needed maintenance (or a visit home). Even so, every load offered should be examined for its productivity potential.

The impact of ELDs on productivity is real. Owners of small trucking businesses can minimize that impact by considering potential productivity on every load offered and by exercising the power of NO when necessary.

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The Trucker Newspaper – February 15, 2020 – Digital Edition

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$225 million purchase enables C.H. Robinson to acquire Prime Distribution Services

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CH Robinson acquires Prime from Roadrunner
Roadrunner Transportation Services has sold its subsidiary, Prime Distribution, to C.H. Robinson for $225 million

Late last month, C.H. Robinson Worldwide Inc. announced its acquisition of the Prime Distribution Services business from Roadrunner Transportation Systems Inc. C.H. Robinson paid $225 million to acquire the carrier and incorporate it into its distribution network.

Prime, of Plainfield, Ind., offers retail consolidation service, including distribution, fulfillment and inventory management to approximately 140 customers. The company was founded in 1990 and manages five fulfillment centers across the country, including 270 employees and 2.6 million square feet of distribution facilities. Prime’s 2019 revenue was $108.7 million.

C.H. Robinson CEO Bob Biesterfeld stated in a press release, “Prime Distribution Services is a high-quality growth company that brings scale and value-added warehouse capabilities to our retail consolidation platform, adding to our global suite of services.”

From Roadrunner Transportation System’s perspective, the sale of Prime will allow the company to move forward with financial confidence. “The divestiture of Prime Distribution Services is a unique opportunity for us to significantly improve our balance sheet,” Roadrunner CEO Curt Stoelting said. “We believe we are well-positioned to execute our strategy of simplifying our portfolio by investing in our remaining Ascent Global Logistics, Active On-Demand and asset-light less-than-truckload segments.”

C.H. Robinson, based in Eden Prairie, Minn., has over $20 billion of freight under its management and processes 18 million shipments annually.

The sale is not Roadrunner’s only effort to change its business model in light of a 2017 accounting scandal and weakening freight demand in 2019. In December, Roadrunner sold its flatbed business unit for $30 million in cash to an undisclosed buyer. A month prior, the company announced the sale of its intermodal business to Universal Logistics Holdings for $51.25 million in cash.

Biesterfeld, in his comments on the acquisition, said, “Prime has an outstanding track record of success, a talented and experienced team and a focus on delivering great value to its customers and carriers.” The acquisition will integrate Prime into C.H. Robinson’s North American Surface Transportation division following the sale’s closing, expected by March 31.

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DAT Solutions: Spot market shifts in shippers’ favor

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this chart shows rate trends over the past four month
This chart shows rates for the past four months for dry van, reefer and flatbed segments. (Courtesy: DAT SOLUTIONS)

PORTLAND, Ore. — Spot load-to-truck ratios for all three equipment types fell during the week ending Jan. 26, and truckload rates for vans and reefers drifted lower as shippers had little trouble finding trucks to haul their freight, reported DAT Solutions, which operates the industry’s largest load board network.

This current lull may be shorter than expected but for now conditions on the spot market favor shippers and demand a creative approach from truckers.

National average spot rates, January (through Jan. 26) included:

  • Van: $1.90 per mile, down 4 cents from the December average
  • Reefer: $2.27 per mile, down 3 cents from December but 9 cents higher than November
  • Flatbed: $2.18 per mile, unchanged from December

Van trends
The national average spot van load-to-truck ratio slipped from 2.1 to 1.6 on neutral van volumes compared to the previous week. For the second straight week, the average van rate was lower on nearly all of DAT’s top 100 van lanes, and rates were higher only on lanes where pricing tends to be weak.
The good news is carriers can almost always find van loads in big Southeast retail freight hubs. The bad news is it’s hard to find lanes between these markets that pay well right now. For example, Memphis, Tennessee to Charlotte, North Carolina fell 14 cents to $1.95 a mile last week, while the return trip lost 9 cents to $1.45.

One option for carriers is to find higher-paying loads in smaller markets where they can triangulate. Instead of hauling a load from Charlotte back to Memphis, they can look for a load from Charlotte to Macon, Georgia, which currently averages $1.95 per mile, and then book a load from Macon to Memphis, which pays $2.11.
A Memphis-Charlotte round trip averaged $1.76 per loaded mile last week for a total of $2,166. The three-legged route through Macon averages $2.05 a mile, which at that rate would earn the carrier $2,806 while adding 136 paid miles to the trip. Depending on the driver’s hours of service, triangular routing may be a good choice in a tough rate environment.

Reefer trends
This is a quiet period for reefer freight, which is closely tied to domestic produce harvests. The national average reefer load-to-truck ratio was 3.8, down from 4.9 the previous week. As a result, the average spot rate fell on 71 of DAT’s top 72 reefer lanes by volume. The sole riser was Grand Rapids, Michigan, to Madison, Wisconsin.
Produce imports from Mexico and at some seaports tend to populate the spot market but many of the loads coming through these ports of entry are scheduled and moving under contract. Plus, there are lots of trucks available in those markets.

As a result, the average spot reefer rate fell on 71 of the top 72 reefer lanes by volume. The sole riser was Grand Rapids, Michigan, to Madison, Wisconsin.

These rates are based on RateView, DAT’s database of $68 billion in annual market transactions. DAT’s freight rate database also provides the settlement prices against which trucking freight future contracts are traded. For information, visit dat.com.

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