Autonomous Trucking Still Distant

In the last year, the trucking industry has seen some of the most critical regulation changes to come in the previous decade. However, the future of trucking may not be affected by those regulations as much as previously believed if the actual future of trucking is autonomous. Autonomous has become a buzzword within not only the trucking industry but in within so many other industries that it’s almost become expected that automation will be factored in somehow.

At the recent SMC3 Jump Start conference, Steve Banker spoke in front of trucking and logistics officials about the prospects and future of autonomous trucking. The current expectation is true; complete autonomous will not be present within the industry for at least another decade or so. The real focus for implementing autonomy should be in a limited capacity rather than expecting a fully autonomous implementation.

The issue with autonomous implementation is that cities and urban areas are essentially no go areas for true autonomous trucks. The congested streets are not easy for trucks to navigate with human drivers but with fully autonomous drivers might be too much to expect anytime soon. Couple that with the fact that e-commerce is driving warehouses to be built in more urban areas so that deliveries can happen quicker for all online orders.

The future focus of autonomy outside of limited implementation should be the last mile delivery autonomy.  This last mile of delivery will become more and more critical as same-day delivery becomes the focus of freight as the need for expediency is further focused on. Autonomy isn’t where it needs to be just yet, but the future is bright for self-driving freight, even if that future is more than a decade away.

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Challenging (Not Necessarily Bad) Year Predicted for Trucking Activity

With 2018 in the rear view mirror, 2019 is shaping up to be a challenging year especially in regards to the possible economic activity. At the recent Heavy Duty Aftermarket Dialogue in Las Vegas Bob Dieli, president and founder of RDLB Inc., spoke on the current and future issues that are expected to affect the industry’s Truckable Economic Activity. As per MacKay & Company:

Truckable Economic Activity measures all types of economic activity that move by truck, providing a more industry-applicable economic indicator than the broader Gross Domestic Product.

With that in mind, 2019’s key TEA concerns are focused on three separate sectors: investment, export, and import. There have been significant retaliatory soybean tariffs that have been leveled against the US by China due to duties on Chinese steel. These import/export tariffs have made it harder less advisable for US soybean growers to export to China which is and continues to be a significant importer of American-grown soy products. Steel imports and non-auto consumer exports make up large percentages of their respective markets which is giving way to concern regarding how these tariffs will affect the TEA.

Unlike in 2018 where the TEA was a five, in 2019 it’s expected to be a two or three. This is the “challenging” nature of the year in a nutshell as many issues and regulations would definitively shape the way the industry operates through the end of the year. HOS, ELD, and other regulatory changes made huge waves and changes to the industry in 2018, and it’s expected that 2019 will be no different. With the industry continuing it’s upward momentum every day and growing, 2019 is looking to be an exciting year for truckers, carriers, and logistics firms alike.

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Inflation pressure cools, but trucking rates keep climbing

As 2019 continues to roll on, the year that was 2018 continues to loom large in the thoughts, statistics, and expectations for 2019. While 2018 was a record year for growth within the trucking industry, it was also a year of volatility regarding the PPI (producer price index) and one that saw inflation thrust to the forefront of the discussion.

In December 2018, price gains were not as excessive as expected due mainly in part to the falling energy prices that fell 5% in the month alone. However, even with falling energy prices, the core PPI did not move during the month and was higher than in December 2017 where it was recorded 2.8% lower than 2018. While the PPI may not seem to be as important an indicator as other factors, it directly correlates to the interest rate increases and increases in inflation that are seemingly expected for 2019.

Even with the core PPI not fluctuating too much, the prices within the trucking industry have continued to rise. Within the last two months of 2018, the producer prices rose almost 2% alone which contributes to the overall year to year inflation rate within the industry to stay around 8%. Most of these gains were also driven by long-distance trucking services while local trucking experienced a decline in the month while keeping steady with the year-to-year numbers.

While the trucking industry’s year that was 2018 will be remembered as one of record growth, lack of capacity and massive regulation changes, the real take away from the year is that inflation was kept down more than years before.  As well, the numbers reflect that 2019 will continue the trend of trucking companies have large amounts of power within the market in regards to determining and setting prices.

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A pragmatic view of how ELDs are changing trucking

If you’ve been following the trucking industry for any amount of time, then you are aware of the controversial ELD regulations that were instituted in 2019. While there have been studies and camps on both sides of the fence attempting to discern the pros and cons of the new legislation, it is still very much mixed within the industry as a whole. Like with most regulations, there is always going to be growing pains surrounding the implementation and adoption of said regulations. With that in mind, the significant overarching benefit of the use of the ELD that cannot be overstated is that is forcing carriers to be more conscious of their trucker’s time.

Steve Viscelli, in a recent article, points out that truckers had been self-recording their own time using electronic log devices log before federal legislation. However, self-monitoring did allow truckers to under, over, or misreport their time; a big problem for the industry.  Viscelli, a senior fellow at the Kleinman Center for Energy Policy, also worked as a trucker for six months to better learn about the stress and strain that the job puts on the trucker. While the ELD regulation is now federally mandated, larger carriers had already adopted electronic logs long before 2018 which means many of the carriers that are lagging weren’t forward thinking initially.

Yes, the ELD is a double-edged sword for any carrier and more specifically their truckers as it makes life both easier and harder simultaneously. As the years go by and the ELD regulations are sorted out and refined so that they get less in the way of the truckers being able to manage their time, sleep, and mileage more efficiently.

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FTR’s Trucking Conditions Index falls but remains in positive territory

It would appear that the record-setting amounts of prosperity that the industry has experienced in 2018 is coming to a close at the end of the year. The Trucking Conditions Index (TCI), which is released by a freight transportation consultancy (FTR), continues the downward trend that has been seen in Q3 and Q4. While not affecting the growth of the industry as a whole, it does show that the industry’s immense success seems to be moving back to a more neutral level.

The lessening conditions are a result of certain outside constraints that have dampened the industry as a whole. While capacity itself seems to have taken a hit, the cost of hiring new truckers along with rising diesel fuel prices is making the environment less favorable then it was even four months ago. In August and July, the TCI readings were 10.24 and 14.04 respectively while October was 3.17, down even from August’s 4.58. This downward trend is due to diesel prices increasing and truckload rates not continuing their massive amounts of growth.

The expectation, however, is that this downward trend will rise by back in the coming months after the positive trends of the holiday season. Unfortunately, though, it would appear that the industry as peaked in FTR’s mind, meaning that the 14 years high will most likely stay as a high and never be surpassed.

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US regulators reject ELD pleas, put focus on trucker hours

The fight against the ELD mandate rages on into final months of 2018 as trucking companies. The last vestiges of the battle are coming from companies who have submitted petitions to the Federal Motor Carrier Safety Administration in hopes of receiving an exemption. However, the FMCSA last week ruled that there would be no such exemption granted to any of these companies, rejecting all ten petitions completely. The reasoning for outright rejection was due to the FMCSA being unable to find that any of these companies would be able to adequately provide similar safety measures comparable to that of the ELD.

While the ELD mandate petitions failed for those companies, there have been several companies that have gotten successful petitions accepted by the FMCSA. These companies were granted exemptions on either partial or full-basis, but the number that was given was small. It seems the ELD mandate is not only here to stay but is also being unwaveringly supported by the FMCSA with very little to no room for change around it.

With the ELD being set in stone, the hours of service rules are now coming under greater scrutiny as they may have a chance of substantial change. The issue with the current HOS rules is that there is little to no real flexibility within them which makes it harder for truckers to not only work within them but also the ELD. The necessity for more flexibility within the HOS rules is essential for the industry as a whole as it will allow truckers not to rush or compromise their day to try and meet specific unrealistic HOS guidelines. RigPark is committed to easing the growing pains of ELD adoption and HOS rules by creating more safe, predictable parking for the trucking industry as a whole.

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The CEO of a trucking company explains the ‘single biggest systemic flaw’ in the industry

While the trucking industry is currently experiencing the most significant shortage of truckers in the history of the industry, the reason for the deficit isn’t as clear cut according to many industry experts. While Amazon and Walmart have pushed the deficit to nearly 50,000 truckers, the real driver behind the shortage may be an issue that is more systemic to the industry as a whole: how truckers are compensated.

Currently, many companies compensate the drivers per mile driven, a draconian yet effective way to judge payment for each driver. However, this compensation variable puts truckers at a disadvantage due to extenuating circumstances outside of their control, i.e., weather, road conditions, etc. This form of compensation isn’t beneficial to attracting new truckers or even retaining current drivers as there are other companies within the industry who have gone to a more “salary-like” structure that ensures drivers receive a minimum base salary.

The bottom line is that the current model of compensation is just another way that trucking companies are unable to keep up with the changing times and needs of their employees. It shows in the numbers as well with a 96% turnover rate in the first half of 2018 for carriers doing $30 million in annual revenue. This number is unsettling high but not unexpected as the large carriers are the ones hurting for new drivers. If drivers can work for regional carriers with better compensation while driving the same distances, there’s no reason to stay with the industry titans.

Trucking is experiencing the greatest upswing in capacity and growth that it has in the last 50 years, but there is still work left to be done. RigPark is committed to helping change the preconceived notions of what the trucking industry can do by creating safe, predictable parking for truckers so that they can get back on the road and onto their next destination.

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Think you’re done raising driver pay? Think again, expert says

In a vacuum, the trucking industry will continue to experience some of the most drastic changes to the pay scale that has ever been seen. In 2018 alone, the cumulative increase for drivers has increased by nearly 12% which would make it the highest year on record for pay increases. Even with the pay increases, the number of new truckers being enticed by increased pay is only 6%, a stunning number considering 85% of all firms surveyed said it hadn’t.

While raising pay does register as an important factor in employee retention, the industry still experiences other issues that many other blue-collar opportunities do not — those being extenuating factors, time at home, and lackluster equipment. Along with those factors, new opportunities are cutting into the prospective trucker pool by offering comparable or higher wages without dealing with the negative factors. In other industries, these factors can be mitigated however trucking has no such way to offset the adverse effects.

Along with extenuating factors, legislation and rule changes are making it harder for specific prospective drivers even to get a trucking job. New changes in drug testing are making it harder for drivers who test positive for opioids to keep their job or also get hired. While these changes are not adverse, they do negatively impact the number of drivers available and hireable by certain trucking companies.

In 2019, four trends are expected to take precedence over the others according to Gordon Klemp, president of the National Transportation Institute.

  • Guaranteed pay – More carriers will offer a minimum weekly pay. Packages currently being offered vary widely from $700 to $1,200 per week depending on region of the country, equipment, endorsements and nature of the freight.
  • Transition pay – Carriers seek to ease new drivers into their system without them being hurt financially by offering increased cents per-mile or a defined payment for a certain period.
  • High engagement activities – Carriers are trying to find driver “touch points” to build and maintain stronger bonds with their drivers, Klemp says. This includes but is not limited to carrier apps, improved communications and special activities for drivers.
  • Increased carrier and shipper collaboration to eliminate inefficiencies – Driver wait time remains the single largest inefficiency in the supply chain, Klemp says. Cutting wasted time at the docks would increase driver productivity and thus maximize the limited supply of drivers.

Expect RigPark to follow these trends and continue to offer cutting-edge solutions to trucking’s most pressing issue: safe, predictable parking.

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US truck employment breaks records but shortage remains

The year 2018 may be known for many things, but for trucking, it will stand as one of the hottest years ever for the industry. From January 1st to October 31st, there has been an addition of over 31,9000 new hires at for-hire trucking companies. Compared to 2017’s growth of 4,700 new employees and 2016’s drop of 5,900, 2018 has been a landmark year for the industry. This growth is in line with the 2.5% growth year over year, another fantastic indicator of the speed at which the industry is growing.

Unfortunately, the industry is still feeling the effects of a lack of good trucks drivers. With a shortage of nearly 50,000 drivers, the workforce needs to expand to be able to get ahead of the shortage issue. These new hires are often working for smaller trucking companies rather than larger carriers. Carriers with one to six trucks have seen employment gains of 68.6% while carriers with over 500 trucks have seen only a 20% gain. These gains are a critical reflection on the ability of regional carriers being able to serve the needs easier than larger carriers.

With the larger carriers experiencing slower growth,  their strict qualifications are putting them behind the curve when it comes to hiring. Their higher requirements make it harder for them to hire more substantial amounts of employees as they are continually looking for the best of the best to join their companies. This shortage of “good drivers” has put an additional strain on carriers to focus on retention rates as well, ensuring that their current employee base isn’t eroded through loss of employees.

RigPark is committed to ensuring that all of the truckers on the road, be it regional or nationwide carriers, all have access to predictable and safe parking that can take the daily stress out of their drives.

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Trucking Regulation Update: Winds of change?

With the election of President Trump in 2016, the trucking industry has seen massive changes that have been both lauded and criticized by truckers and trucking company owners. While often perceived as an industry rife with deregulation, the true regulated nature of the industry is changing at a pace that belies previous notions on the industry’s true nature. The three main points of contention for the industry moving into the next year is the usage of ELDs, the changes to the HOS, and the allowance of under 21 drivers into the sector.

While the ELDs have been an issue since they were introduced in early 2018, the industry as a whole seems to move into the acceptance phase with them. They have helped keep not only truckers honest but also shippers as well, allowing for a more even-keeled approach to time management. The usage of ELDs also factors into how the HOS (hours of service) changes are being implemented.

The HOS tweaks have stemmed directly from the usage of the ELDs as drivers can show precisely how their time is being used and where they can expect changes in the way it’s being monitored. The tweaks are also being implemented quicker than expected, especially since regulations usually take time to pass. The need for safe, predictable parking is also becoming more critical for HOS tweaks as being able to utilize the full amount of time whenever possible is of the utmost importance.

While allowing drivers under 21 to join the trucking industry is a controversial step, it’s one that could have massive benefits for the industry as a whole. With the current shortage of drivers, any help in the area of workforce shortages is a welcome change, even if it is experiencing pushback.

RigPark is committed to helping the ever-changing trucking industry by making the changes more comfortable to handle, especially ELD and HOS changes, by offering safe, predictable parking. It’s trucker’s jobs to go the distance, let us cover the final mile of delivery.

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