Posts Tagged ‘federal motor carrier safety administration’

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Trucking Reliance Increases but Rising Costs Spell Trouble for Small Carriers

Friday, June 7th, 2013

Trucking continues to dominate as the primary means of transporting freight over any other mode in the United States.  In the American Trucking Associations’ ATA American Trucking Trends 2013 report issued last week, trucking increased last year compared to 2011, accounting for 9.4 billion tons of freight (68.5% of all domestic shipments). With 6.9 million trucking-related employees, 2012’s trucking hit “$642.1 billion in gross freight-related revenues, or 80.7 percent of the nation’s freight bills.” 1

Bob Costello, ATA Chief Economist explains, “As the nation continues to travel the road to recovery following the Great Recession, it is becoming increasingly clear that trucking is leading the way.”

With shippers heavily relying on trucking to get their products delivered to customers on time, it may come as a surprise that only 2.8% of fleets contain over 20 trucks, with 90.5% of carriers operating six or under. 1 But increased costs spell trouble for small carriers.

“Smaller carriers can’t handle the increased costs of industry regulations and can’t hold their heads above water any longer,” spoke ATA Chairman Mike Card at the Great West Fleet Executive Conference held last week.  “Trucking has been consolidated.  The primary reason for consolidation in the trucking industry is the costs associated with increased regulation.” 2

Among these regulations Card is referring to include the following:

-Revisions to the hours-of-service, becoming effective July 1st, which include a restart provision containing two consecutive breaks between the hours of 1 a.m. and 5.am., reducing a driver’s work week from 82 to 70 hours, as well as a mandatory 30-minute break if 8 hours or less have passed since the driver’s last off-duty period.

-CSA, which is holding carriers and drivers more accountable, is limiting the number of unsafe drivers from the road, and thus, a carrier’s fleet.

-The mandatory use of electronic onboard recorders, which Federal Motor Carrier Safety Administration’s Anne Ferro believes will be proposed by September, would further dig into carrier’s pockets.

Other mandates Card referred to included “emissions standards, anti-lock brakes, fuel standards, and more.” 2

As Card explained, “It doesn’t matter how old you are.  It matters how big you are. If you’re not big enough and profitable enough to handle the additional cost of regulation, you’re going to struggle to survive,” stating that carriers “basically have only three options for leaving the industry, ‘merger, sale or death.’” 2

In fact, Card posed the idea that one day the trucking industry will have consolidated so far that it could be left with only four or five carriers to choose from, like the airline industry, and that similarly, shipments will be booked online. 2

road scholar transport

Road Scholar Transport utilizes safe equipment driven by qualified, uniformed drivers every day. Visit our website to learn how you could become part of our team!

An emphasis on the use of social media, education, uniformed drivers, and clean and safe equipment needs to be utilized to help remake the industry’s image, Card also noted. 2

For a copy of the ATA’s American Trucking Trends 2013 visit trucking.org.

Do you think that trucking will eventually consolidate to 4 or 5 carriers to choose from like Card poses?

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1http://www.thetrucker.com/News/Stories/2013/5/29/NewreportunderscorestruckingsessentialroleinUSeconomy.aspx

2http://www.ccjdigital.com/atas-card-costs-regulations-forcing-out-truckings-first-generation/

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FMCSA Announces New and Upcoming Proposals

Friday, May 17th, 2013

FMCSA

Building off of current regulations, the Federal Motor Carrier Safety Administration announced its new and forthcoming propositions, which included its recently posted Medical Examiner’s Certification Integration and upcoming no-defect Driver-Vehicle Inspection Reports proposals.

Medical Examiner’s Certification Integration Proposal

Last year, the FMCSA enforced validation of medical exams through random checks and took measures to eliminate fraudulent MECs and unsafe drivers from the road, including the requirement of drivers to receive medical certificates from an FMCSA-approved examiner, with most of the requirements going into effect in 2014. 1

Last week, the FMCSA included in the Federal Register the second part of the original ruling proposing the following requirements:

*Medical examiners would need to utilize a new Medical Examination Report Form when performing physical exams on drivers.2

*Medical examiners would be required to “use a prescribed form for the medical examiner’s certificate.”2

*Medical examiners will expedite the results process by sending completed physical exam results to the FMCSA the same day that the exam was performed.2

*The Medical Examiner’s Certificate information will be transmitted from the National Registry system to the State Driver Licensing Agencies electronically.2

*“Transmit to the SDLAs information about Medical Examiner´s Certificates that have been invalidated because a subsequent examination has found that the driver is not physically qualified.” 2

*Medical variance information for such drivers must be transmitted by the agency to the SDLAs electronically.2

For drivers, the changes would mean that they would no longer have to carry their medical certificates or documents since the information will be available electronically to local DMVs and law enforcement as well as would not have to verify the medical examiners National Registry Number.

If passed, the ruling would become effective in three years.

To view the FMCSA’s Medical Examiner’s Certification Integration proposal click here.

Driver Vehicle Inspection Reports

Last year, the FMCSA published a ruling that would omit intermodal equipment from submitting and retaining no-defect driver vehicle inspection reports, becoming effective June 12th.3

Now, the FMCSA is looking to apply a similar ruling to interstate truckers, which the Department of Transportation believes would save the industry $1.5 billion annually, hoping to issue a Notice of Proposed Rulemaking by Sept. 10th. 3

Also on the agenda is a proposal that would permit carriers to use e-signatures for electronic recordkeeping with no date set as of yet.3

To view all of the FMCSA’s final rulings and proposals visit http://www.fmcsa.dot.gov/rules-regulations/rules-regulations.htm.

What do you think of the FMCSA’s new and upcoming proposals?  Are you in support or opposition?

1http://www.etrucker.com/ovd/fmcsa-proposes-rule-to-immediately-transmit-medical-exam-results-to-state-licensing-agencies

2http://www.thetrucker.com/News/Stories/2013/5/9/FMCSAproposesruletoautomatedriversphysicalexamresults.aspx

3http://www.overdriveonline.com/fmcsa-easing-burden-on-driver-vehicle-inspection-reports/

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Identifying Chameleon Carriers

Friday, May 3rd, 2013

fmcsa inspection

Chameleon carriers remain a growing concern in the trucking industry, as existing or pre-existing carriers are registering under new company names and DOT#s in order to hide poor safety records, out-of-service issues, and to avoid paying fines.

The Federal Motor Carrier Safety Administration is cracking down on reincarnated carriers, issuing Out-of-Service Orders to those believed to have taken on a new identity.

So was the case last week with four Kansas carriers.  Earlier this year, the FMCSA issued an Out-of-Service and Record Consolidation Order against Royal Transport, Nationwide, Inc., Freight, Inc. and Midwest A, Inc.  According to the Final Decision on Petition for Administrative Review of Operations Out-of-Service and Record Consolidation Order document, Nationwide, Freight, and Midwest were found to be reincarnations of Royal in order to avoid negative safety and compliance reviews.  The companies were also found to be utilizing the same drivers.  Additionally, Freight, Inc. had safety scores of 98.2% (Unsafe driving) and 95.2% (Fatigued driving).

Although serving the orders to the companies in January, an administrative review was granted and, upholding the decision, the FMCSA ordered the companies to cease operations last week.

Chameleon carriers pose a large risk to everyone on the road as well as to your freight.  According to the GAO, the risk of an accident is three times higher among chameleon carriers than other new carriers and with over 66,000 U.S. DOT number applications being submitted each year, 98% are not being cross-checked with those previously shut down.

So how are these chameleon carriers identified?

According to the FMCSA, there are 13 main factors used in identifying chameleon carriers.  They are as follows:

-“Whether the new or affiliated entity was created for purpose of evading statutory or regulatory requirements, an FMCSA order, enforcement action, or negative compliance history” 1

-“The previous entity’s safety performance history, including safety violations and enforcement actions” 1

-“Consideration exchanged for assets purchased or transferred” 1

-“Dates of creation and dissolution or cessation of operations” 1

“Commonality of ownership among the entities” 1

-“Commonality of officers and management personnel” 1

-“Identity of physical or mailing addresses, telephone, fax numbers, or email addresses” 1

-“Identity of motor vehicle equipment” 1

-“Continuity of liability insurance policies or commonality of coverage under such policies” 1

-“Commonality of drivers and other employees” 1

-“Continuation of carrier facilities and other physical assets” 1

-“Continuity or commonality of nature and scope of operations, including customers” 1

-“Advertising, corporate name, or other actions through which the company holds itself out to the public” 1

Road Scholar Transport promotes the operation of only safe and qualified carriers on the road, that’s why we are giving you five ways in which you can help reduce the risk of hiring chameleon carriers:

-Research a carrier’s CSA (Comprehensive Safety Analysis) scores. This can be done by going to the FMCSA website (www.fmcsa.dot.gov) and clicking on Safety & Security, Company Safety Record, Safety Fitness Electronic Records System, Company Snapshot, and then entering the carrier’s DOT number, MC number, or name.  By clicking on SMS Results, you will gain valuable information regarding the number of out-of-services and accidents a carrier had as well as citations, helping you choose a safe carrier.

-Receiving daily updated authority/insurance data from carriers through products such as CarrierWatch.

-Research the company’s background. How long have they been in business?  Conducting business with a company who has been operating in the industry for several years and is well-established can help you avoid choosing carriers that are constantly re-incarnating themselves under new names to avoid penalties/out-of-service orders.

-Check the chameleon carrier database.  CarrierWatch grants you the ability to view a list of trucking companies whose operating authority has been revoked.

-Ask around.  Why not go directly to the source of who has experience using a particular carrier?  Referrals are a powerful tool in receiving insider information about a carrier’s reputation.

What do you feel needs to be done to prevent chameleon carriers from operating under a new DOT number and dodging violations?  Do you feel that shippers are not frequently vetting out carriers/checking safety scores?

1http://www.regulations.gov/#!documentDetail;D=FMCSA-2013-0079-0004.

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FMCSA Amends CDL Ruling

Friday, March 29th, 2013

After receiving 34 petitions in response to their May 2011 amendment, the Federal Motor Carrier Safety Administration has granted several changes to their final ruling regarding issuance of commercial learner’s permits (CLPs) and driver’s licenses (CDLs).

According to the federal register, the following amendments have been granted:

Verification

Previously- Two State Driver’s Licensing Agency (SDLA) members were required to “verify CLP and CDL applicants’ test scores, completed application forms, and documents to prove legal presence,” leading to complaints of  increased workloads for agency SDLA members during a time of reduced resources. 1

Amendment- Although the FMCSA no longer requires two people to verify the same document, two people must still be involved in the licensing process.

Training Schools

Previously- CDL training schools were only allowed to administer skill tests if there were “no skills testing alternative within 50 miles of the school and the same examiner does not train and test the same student applicant,” otherwise, skills testing was prohibited, which some called a hardship and too restrictive. 1

Amendment- CDL training schools are allowed to administer skills tests with the understanding that the examiner does not test their own students.

Bonding

Previously- Third party CDL testers (many of whom are governmental entities) were required to “maintain bonds in an amount sufficient to pay for retesting of drivers if required due to examiners engaging in fraudulent activities related to skills testing.” 1

Amendment- Due to a lower risk obtaining expenses and that most states do not require political agencies to obtain bonds, the FMCSA eliminated the requirement for governmental entities to maintain bonds. 1

CLP Photos

Previously- Driver digital color or black and white laser engraved photographs on CLP’s were prohibited, leading to security complaints.

Amendment- CLP photograph inclusion, including digital color and black and white laser engraved, is now permissive.

Background Checks

Previously- Test examiners were required to undergo background checks every year, which many considered to be a burden.

Amendment- Test examiners only need to undergo background checks upon hiring.

federal reg

The above amendments become effective April 24, 2013.

Click on the image to the right to read a copy of the revisions listed in the Federal Reserve.

Do you believe that these amendments will have any effect on the driver shortage or the quality of drivers operating on the road?

If you are a qualified CDL driver looking for a position at a reputable trucking company, visit Road Scholar Transport’s Employment Opportunities Section!

1http://www.gpo.gov/fdsys/pkg/FR-2013-03-25/pdf/2013-06760.pdf#page=1&zoom=auto,0,800

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Corruption in the Trucking Industry

Wednesday, February 27th, 2013

Corruption. Kickbacks. Stolen freight. These are all things you could be dealing with when shipping with a carrier you have not previously researched and vetted out. Corruption exists everywhere and the trucking industry is no exception.

Kickbacks

What is it?

“Kickbacks are undisclosed payments made by a third-party to a company’s employees. Kickback schemes almost always result in the victim company being over billed.” 1

Example

We hear all of the time about trucking company employees upping their rates in a kickback scheme that puts money in their pockets. Let’s look at a popular case that went to court in 2008 resulting in a several million dollar verdict.

SC Johnson, a well-known household brands manufacturer, was being charged inflated rates by trucking contractors who kickbacked a portion of the money to Milton Morris (SC Johnson’s transportation director at the time, terminated in 2004 when SC Johnson’s investigation began) and Katherine Scheller (Morris’ employee to which he bought gifts for). 2

According to the trial, “Transportation carriers [Transport Corporation of America, Inc., Stevens Transport, Inc., Far Side Trucking, Inc., and Graham Kent Pharr who have pleaded guilty] gave Morris hundreds of thousands of dollars in cash, lavish travel and expensive jewelry in exchange for business with SC Johnson.” 3

SC Johnson was awarded $203.8 million in damages in 2008 against Morris, Scheller, and the four men who ran the transportation companies and in 2011, Morris was sentenced to 8 years, 1 month in prison along with 3 years of supervised release and “$20 million in restitution payments to SC Johnson, with $5.4 million of responsibility shared with his co-defendants. 2 Scheller received three years in prison and one year of supervised release. 2

Chameleon Carriers

Who are they?

Chameleon carriers are existing/pre-existing carriers who register as a new carrier in order to hide poor safety records, out-of-service issues, and to avoid paying fines.

Example

Chameleon carriers are becoming a serious problem in the transportation industry.  A recent study conducted by the GAO found that in 2010, 1,136 new applicants were attributed as chameleon carriers, increasing by 377 since 2005, with 94% being freight carriers. 4

chameleon carriers

Click the video to watch 41 Action News’ Investigation on Chameleon Carriers

In 2012, 41 Action News Investigators uncovered seven citations on Freight, Inc. (operated by Binder Singh) including out-of-service brakes, stating that “96% of the companies on the road have better vehicle maintenance records, and 98% have better driver safety records,” according to the Federal Motor Carrier Safety Administration. 5

However, further investigation proved that Singh had operated numerous trucking companies under different DOT numbers, including one company which was issued an out-of-service order due to safety violation fines to which Singh declared bankruptcy and reopened the next company.

How to Prevent

Chameleon carriers pose a large risk on the road and to your freight. According to the GAO, the risk of an accident is three times higher among chameleon carriers than other new carriers. 6

With over 66,000 U.S. DOT number applications being submitted each year, 98% are not being cross-checked with those previously shut down. 6 On February 18th, “the FMCSA sent the final rule (expected to publish in the Federal Register this May) for a Unified Registration System to the White House Office of Management and Budget for review” that would “replace several existing identification systems” and “serve as a clearinghouse and depository of information on motor carriers, brokers and freight forwarders and others required to register with the U.S. DOT.” 7

For a list of five ways in which you can help reduce the risk of hiring chameleon carriers click here.

Double Brokerage

What is it?

Double brokering occurs when a carrier agrees to move a load with a broker and then brokers that load out to another carrier without the original broker knowing.

Risks

When a load is double brokered, neither the original broker nor the shipper is aware of who is moving their freight or if the carrier has the proper license, liability insurance, or safety record to do so. This then leads to increased vicarious liability and due diligence risks. Learn more about vicarious liability here.

Examples

From January 2006 to December 2009, Pauline Robinson-Kirkland set up over 15 trucking company names for which she used to bid on online boards, receiving nearly 69 payments, never paying the carrier who actually transported the shipment. 8 With the new highway bill signed on July 6th, 2012, the broker bond was raised from $10,000 to $75,000. 8

How to Prevent Due Diligence

Below is a list of how you can reduce the risk of due diligence:

-Check the carrier’s CSA scores. Learn how at http://www.youtube.com/watch?v=DUXpdbubDVM

-Run a credit check

-Obtain/contact references

-“Be clear in defining obligations and responsibilities in co-brokering agreements. Include a clause against unauthorized double brokering and the penalties associated with it in the contract of carriage.” 9

-Keep track of your shipment in transport. Ask for status updates.

Insider Jobs

What is it?

Theft results in a loss of more than $30 billion in the transportation/shipping industry each year.  What’s even more stunning is that 85% or more of these thefts are a result of insider jobs, individuals who had the information/ability and used it for their own benefit.

Drivers utilize what they know about a shipment/trucking company, not to steal the freight themselves, but rather distribute their information to thieves in return for compensation.

Drivers have also been known to stage their own hijackings, arranging to leave their trucks unattended at a specific time in which their accomplice then moves in, stealing the loaded truck in exchange for money.

Example

On Monday, November 12, 2012, 3,600 iPad Minis valued at $1.9 million were stolen from the same JFK airport building as in the movie Goodfellas.

The heist was found to be an insider job as authorities arrested Renel Rene Richardson, employee of JFK’s Cargo Air Services building, who “allegedly made suspicious inquiries to coworkers about the shipment, as well as where he might be able to access a forklift.” 10

Richardson acted as a lookout in the heist as two others entered the building, utilizing the airport’s forklift to load two pallets of the iPad minis into the truck just before another airport employee, who was arriving from dinner, began questioning the thieves, leading them to flee before they could load three other pallets of iPads onto the truck. 10, 11

Fraudulent Carriers

We must not forget those thieves who pose as carriers, especially on load boards, to obtain and steal freight.

Example

Between April 2011 and February 2012, the FBI investigated 17 cargo thefts involving meat trucks, the majority from the Amarillo area, valuing between 720,000 and over $4 million. 12

On June 15, 2012, a trucking company was contracted (through a broker) to transport ribeye from Amarillo to Chicago, but never made the delivery. 12

A person claiming to be part of a Michigan trucking company contacted a broker regarding the transport of two truckloads of beef from Amarillo to California. When the broker reported it to the FBI, the Michigan company claimed that they never hauled refrigerated foods. 12 When the FBI teamed up with a broker to contract the company to haul two truckloads, they caught three men who they found to have a fake CDL as well as a “real driver’s license registered to a woman.” 12

Bribes

What is it?

It goes without saying, a bribe is when a person pays another off as a means of persuasion to act in their favor.

Example

Just last month, a DOT official was sentenced to 18 months in prison along with a $41,300 fee after “taking tens of thousands of dollars in bribes in exchange for initiating “complaint audits” that could put a company out of business, or for giving favorable audits to other firms, providing “inside information” that let some companies keep potentially unsafe trucks on the road” such as postponing safety inspections as well as “providing consultants with internal agency information, including lists of trucking companies scheduled to be audited.” 13

Do you believe that kick backs are occurring in the trucking industry? To what extent? List your comments below.

1http://www.linkedin.com/groups/What-is-Kick-Back-Scheme-4360801.S.136335198

2http://www.truckinginfo.com/channel/aftermarket/news/story/2011/11/two-sentenced-in-sc-johnson-transportation-kickback-case.aspx?prestitial=1

3http://journaltimes.com/news/local/update-jury-awards-sc-johnson-million-in-trucking-kickback-case/article_1841c1e7-257b-596c-bc1c-58a466713303.html

4http://www.roadscholar.com/blog/paying-civil-penalty-no-longer-offers-backdoor-to-liability-fmcsa-revision-takes-effect-this-month/

5http://www.kshb.com/dpp/news/local_news/investigations/investigation-reveals-chameleon-carriers-are-dodging-dot-regulation

6http://knowledgebase.findlaw.com/kb/2013/Feb/867829.html

7http://www.landlinemag.com/Story.aspx?StoryID=24812

8http://www.landlinemag.com/Story.aspx?StoryID=23924

9http://www.freightbrokertraininghq.com/co-brokering-and-double-brokering-the-boon-and-bane-of-freight-brokers/

10http://appleinsider.com/articles/12/11/19/suspect-arrested-in-19m-ipad-mini-heist-at-jfk-airport

11http://www.geek.com/articles/news/1-5-million-of-ipad-minis-stolen-from-goodfellas-jfk-heist-building-20121115/

12http://amarillo.com/news/local-news/2013-02-19/3-face-federal-charges-meat-thefts

13http://www.truckinginfo.com/channel/fuel-smarts/news/story/2012/01/former-fmcsa-supervisor-jailed-for-accepting-bribes.aspx

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Accidents in the Trucking Industry

Friday, February 15th, 2013

Every 60 seconds a motor vehicle accident occurs.  With nearly 5.25 million accidents occurring each year, accounting for over 43,000 fatalities and 2.9 million injuries in the U.S., motor vehicle accidents serve as one of the leading causes of death in the world. 1

Who’s at Fault

Last Tuesday the American Trucking Associations (ATA) referred to a recent study conducted by the University of Michigan Transportation Research Institute (UMTRI), acknowledging that out of 8,309 car/truck accidents studied, 81% of the time cars were at fault versus 27% in which truckers were to blame (equaling 108% due to the difference accounting for both cars and trucks at fault). 2

Whereas cars were at fault in “89 percent of head-on crashes; 88 percent of opposite-direction sideswipes; 80 percent of rear-end crashes, 72 percent of same-direction side-swipes and cited for two or more unsafe acts in an AAA Foundation for Traffic Safety Study,” trucks “were the encroaching vehicle in 98 percent of backing accidents, although this represented less than 1 percent of the sample set, and only 11% of truck drivers were cited for two or more unsafe acts.” 2

As ATA President Bill Graves notes, “It is tragic that carriers and drivers across this country are saddled with guilt and blame for many crashes they could do nothing to prevent.” 2

Crash Weighting

Shortly after the Federal Motor Carrier Safety Administration (FMCSA) put into effect changes to the CSA’s Safety Measurement System last December, the ATA released a white paper explaining that “the CSA system lacks sufficient data on the majority of the industry to render meaningful scores for most motor carriers.” 3

According to the ATA, the FMCSA “has sufficient violation data to assess 40% of active carriers in at least one category but only enough to assign a percentile rank or score in at least one category to 12% of active carriers.” 3

The FMCSA is currently revising the crash weighting system explaining that they are continuing to “work with many partners, including the Motor Carrier Safety Advisory Committee (MCSAC), on a Crash Weighting Research Plan that outlines the research goals and approach to support an equitable mechanism for crash weighting,” expected to be completed this summer. 2 These goals include the following:

*“To determine whether Police Accident Reports (PARs) from across the nation provide sufficient, consistent and reliable information to support crash weighting determinations.” 2

*“To assess whether a carrier’s role in a crash is a stronger predictor of future crash risk than crash involvement alone, and, if so, how crash weighting should be implemented in the Safety Management System (SMS).” 2

*“To evaluate how the agency could use additional data in the determination process to allow for public input.” 2

Despite all of this, nearly 500,000 truck accidents occur in the U.S. annually, which is why proper safety measures need to be taken.

Accident Reduction Technology

While technology continues to exceed its boundaries, carriers are looking for new ways to keep their drivers, your freight, and everyone on the road, safe.  Below is some of the anti-crash technology that Road Scholar Transport utilizes on our fleet.

ACB Systems

In July of 2009, the National Highway Traffic Safety Administration issued a ruling requiring an improved stopping distance for heavy trucks, reducing the distance of trucks traveling at 60 mph from 355 feet to 250 feet, allowing a minority of very heavy tractors a stopping distance of 310 feet.

The ruling, however, sparked the response of eight petitions based on four main issues.  One of them, having to do with the stopping distance requirements, was challenged by the TMA, HDBMC, and Bendix, who believed that “speeds lower than 60 mph have not been validated through actual vehicle test data” and that “the brake timing may be too fast for some vehicle configurations.”

Therefore, the NHTSA was asked to remove the new requirements until tests could be conducted and results obtained.  The NHTSA accepted and “required compliance with the improved stopping distance requirements for tractors with four or more axles and a GVWR of 59,600 pounds or less by August 1, 2013.”

bendix

Road Scholar Transport has ACB systems (Active Cruise with Braking) installed on our trucks that allows us to maintain a set distance of 8/10ths of a mile marker behind a forward vehicle.

When cruise control is off, the ACB will deliver a beeping alert, which gets faster and louder when closing in on a vehicle, as well as a visual warning on the dashboard showing how far the vehicle is from our truck.

When cruise control is on, the ACB will automatically reduce the throttle, use the engine retarder, or apply the brakes (delivering 1/3 the vehicle’s power but the driver can apply the rest if needed) in order to maintain a set distance from the vehicle ahead.

Imagine a truck or vehicle stalled in the middle of the road on a dark night with no lights on or a school bus that you could hardly see because of the thick morning fog.  Or maybe a vehicle decides to slam their brakes in front of you to avoid hitting an animal crossing the road.  Now imagine going 65 mph when one of the above circumstances occurs.  Road Scholar’s applied ACB system allows our trucks to maintain the distance necessary to prevent accidents, and thus, delays and damages to your freight.

Roll Stability


Last May, the National Highway Traffic Safety Administration issued a Notice of Proposed Rulemaking that would require electronic stability control (ESC) systems on heavy-duty trucks (GVW greater than 26,000 lbs) with a manufacturing year of 2016 (when the requirement would go into affect) and onward.

According to the NHTSA, stability control systems “would help prevent 40-56 percent of untripped rollovers and 14 percent of loss-of-control crashes.” 4

This system (also utilized by Road Scholar) is especially good for icy or wet weather conditions where wheels lose their grip, or taking a curve too quickly, which can result in a rollover.  Drivers may not sense a rollover could be starting, which is where the ESP’s row and yaw stability sensors come into play.  The row sensors work to prevent rollovers while yaw sensors prevent slide, spin, or jackknife situations.

The ESP automatically distinguishes the problem and quickly corrects it by reducing the engine throttle and applying the brakes.

Bendix explains the many sensors that supplement the wheel speed sensors which include:

-The steering angle sensor, which detects steering input, the first indicator of a maneuver.

-Brake pressure sensors, which monitor the amount of an operator’s braking.

-Lateral acceleration sensor, which detects the side force that could make the vehicle rollover.

-Yaw rate sensor, which helps determine if the vehicle is responding properly to driver steering input.

For a better understanding of how ESC systems work, check out the video below.

bendix esp

Do you believe that accident-reduction in the trucking industry lies more with agencies establishing stricter rules/regulations, carriers installing safety technology to their fleet, brokers/shippers properly vetting out safe carriers, or all of the above?  List your comments below.

1http://www.usacoverage.com/auto-insurance/how-many-driving-accidents-occur-each-year.html

2http://www.thetrucker.com/News/Stories/2013/2/12/FMCSAagencyworkingonequitablemechanismforcrashweighting.aspx

3http://www.supplychaindigital.com/global_logistics/ata-speak-out-about-csa-data-limitations

4http://www.landlinemag.com/Story.aspx?StoryID=23928

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Cybercrime and Climate Change Spell Danger for Supply Chain

Friday, January 25th, 2013

According to a report released earlier this week by World Economic Forum, 80% of companies across the globe place increased supply chain security a priority, expressing concerns evolving from cybercrime, natural disasters, and climate changes. 1

Cybercrime

The number of crimes occurring through the internet is expected to cybercrimeincrease this year and no one is safe.  Whether you are a shipper, manufacturer, carrier, or consumer, cybercrime affects everyone and it is becoming a larger issue in the trucking industry throughout the years.

More and more instances of fraudulent companies using online methods to develop and steal freight are erupting, posing a concern for those shippers utilizing brokers, since they do not know who exactly is handling their freight or if the company now entrusted with their goods is legit.

But how are thieves securing these loads in the first place?  Many times it is through brokers who post their loads online, and who do not always vet out drivers before handing them your shipment.  This can result in fraudulent companies stealing your freight or double brokerage schemes.

Where’s my freight?

Let’s look at a case in March 2011 where a fraudulent trucking company utilized a number of brokers to make away with several shipments.

Realizing the impact that freezing weather conditions would play on produce sales, E&A Transport Express quickly registered with the Federal Motor Carrier Safety Administration and began to search out brokers listing produce loads, posing as a Miami-based trucking company.  By taking loads that were given a few days for delivery due to distance, the company had enough time to pull of the theft before the goods were reported missing/undelivered.  They managed to secure eight loads of produce, a high target at the time due to their rising prices, making away with close to $300,000, not to mention creating a widespread concern over the reselling of potentially contaminated products.

On the other hand, if the shipper had transported their cargo with Road Scholar Transport, they would been able to track their shipment live as well as have their freight constantly monitored by Road Scholar employees so that if a driver goes off route, the driver and truck are immediately contacted and checked of any problems.

Double Brokerage Schemes

Another common cybercrime affecting the transportation industry are double brokerage schemes.

Last July, Pauline Robinson-Kirkland was charged with six counts of fraud after setting up over 15 trucking company names from January 2006 to December 2009, using these companies to bid on loads posted online. 2 Once a load was granted, Robinson-Kirkland would ask for payment to be sent to her company, while reposting the same load, never informing the carrier that it was being double-brokered. 2 Robinson-Kirkland received nearly 69 payments, never paying the carrier who actually transported the freight.

Natural Disasters/Climate Changes

Natural disasters can strike at any moment, affecting profits as businesses attempt to recover from damaging affects (as was the case in the recent Hurricane Sandy).

70% of companies, according to the Carbon Disclosure Project (CDP) and Accenture’s research which surveyed 2,415 companies composing of suppliers and purchasers, believe that climate change affects their revenue as well, with 678 of these companies investing in emission reduction initiatives. 3

Emissions

According to CDP’s research, “Suppliers are significantly less prepared than their clients to respond to climate change, potentially threatening customer relationships and heightening supply chain vulnerability,” with 38% of suppliers setting emission reduction initiatives verses 92% of purchasing companies.” 3

29% of suppliers have already reduced emissions, leading them to save nearly $13.7 bn. 3 As Accenture’s Gary Hanifan explains, “This report provides clear evidence that those who are most transparent about their climate change risks are more likely to achieve the greatest emissions reductions. And they are also more likely to enjoy monetary savings as a result of their responses to climate change risks. But the return on investment by the most proactive companies will not reach its full potential unless those companies can encourage their suppliers to follow their lead.” 3

Road Scholar, a SmartWay Company

smartway

Recognized by the U.S. Environmental Protection Agency for committing to improve the environmental performance of our customer’s freight operations, Road Scholar is collaborating with the SmartWay Transport Partnership with a focus on reducing emissions and fuel consumption.

SmartWay, launched in 2004 by EPA and Charter Partners and has grown to include over 3000 partners since, works with carriers to track fuel consumption/improve performance, identifying equipment that helps save fuel and lower emissions.  Becoming a member of SafeWay, Road Scholar vows to contribute to the Partnership’s savings of 1.5 billion gallons of fuel, $3.6 billion in fuel costs, 14.7 MMT of carbon dioxide (CO2), 215,000 tons of oxides of nitrogen (NOx) and 8,000 tons of particulate matter.

Road Scholar’s 2012 trucks are 40 times cleaner than 2007 engines.  In fact, newer equipment/engines “can improve their performance and reduce key emissions by up to 90 percent.” 4

Road Scholar has already gone eco-friendly and is offering the following advice on how you too can reduce your carbon footprint:

-As stated previously, newer trucks/equipment, fuel efficiency methods (such as eco-friendly fuel choices, reducing deadhead, and planning routes to make mileage more efficient), as well as  joining a program such as SmartWay can help reduce the amount of diesel your trucks emit.

-Speed control:  It goes without saying, the faster you go, the more fuel you burn.  For example, traveling at 60 mph would burn fuel at a rate of 6 mpg.  Traveling at 70 mph would burn fuel at a rate of 5 mpg…and so on.

-Skirting on trailers slipstreams the trailer and reduces drag created by rushing air.  In fact, those skirts that are verified by SmartWay are known to increase fuel efficiency by 4-7%. 5

-Cruise control typically has a .3% fuel efficiency gain by helping your driver maintain a steady speed instead of constantly stepping on the gas and then braking.

-Progressive shifting:  For example, shifting at lower revs in lower gears rather than tacking out the rev/minute in each gear.

-A good driver vs. a cowboy, who is constantly running fast.

With these tips, you too can become an eco-friendly carrier and help our environment.

For information about the SmartWay Transport Partnership visit www.epa.gov/smartway.

Do you prefer to ship with an eco-friendly carrier?

1http://articles.economictimes.indiatimes.com/2013-01-22/news/36484379_1_chains-natural-disasters-risks

2http://www.landlinemag.com/Story.aspx?StoryID=23924

3http://finchannel.com/Main_News/Business/122499_Major_Climate_Threat_to_Global_Supply_Chains_Identified_by_New_Research_/

4http://www.marketwatch.com/story/in-the-past-10-years-emissions-from-diesel-trucks-and-buses-have-been-reduced-by-99-for-nox-and-98-for-particulate-emissions-2012-02-21

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2013 Brings Increased Problems for Carriers

Friday, January 18th, 2013

Trucking companies will face a greater challenge this year as volumes, rates, and capacity issues are forecasted to grow, increasing difficulties among carriers.  As Transport Capital Partners (TCP)’s Richard Mikes notes, “Volume and rate outlook does not bode well for cash flows and profits in 2013 for an industry under costs and availability pressure for drivers.” 1

Freight Volumes

The TCP’s Fourth Quarter 2012 Business Expectations Survey, which evaluated trucking executives, forecasted for the first time since 2009’s 1st quarter that freight volumes will remain flat. 1

Last month, the DAT North American Freight Index noted that although freight volumes declined 18.4% from November to December, December volumes were up 5% compared to the same time last year and were at their highest December mark since 1996. 2

Capacity

Carriers are refusing to add capacity unless they are “tied to specific dedicated fleet contracts, as supply and demand is now roughly in balance despite weak U.S. economic growth,” stated Stifel Nicolaus senior transportation analyst John Larkin. 1

perfect storm for capacity shortage

Click to enlarge

Capacity shortage is the result of several factors (see The Perfect Storm for Capacity Shortage on the right) including new, stricter regulations in the trucking industry such as “speed limiters, revised drug testing procedures, and the medical certification process.” 1

One of the regulations causing great debate is changes to the Federal Motor Carrier Safety Administration’s CSA, including the revision of the hours-of-service provision which becomes effective July 1st.  This revision is expected to reduce a driver’s work week from 82 to 70 hours (a 17% decrease).

Earlier this week, the Office of Inspector General of the Department of Transportation announced an audit of the Federal Motor Carrier Safety Administration’s CSA, in particular concerns over its Safety Measurement System, stating, “Specifically, our audit will assess whether FMCSA has (1) established adequate controls to ensure the quality of the data used to evaluate carrier performance and risk, and (2) effectively implemented CSA enforcement interventions.” 3

Meanwhile, stricter regulations such as CSA are adding to the driver shortage, not only by reducing the number of unsafe drivers on the road, but the cost of training the younger generation and inexperienced drivers is acting as a barrier as well.

In order to attract drivers to their fleet, carriers are competing with wages, bonuses, and other incentives, but in order to increase driver pay, rates need to rise as well, another challenge carriers are facing.

Rates

Despite capacity shortages, nearly 46% of carriers expect rate trendrates to remain the same while 44% expect to see only a moderate increase (this percentage favorable among large carriers). 1 Only 21% of the carriers participating in TCP’s survey increased their rates within the last few months which is said to be “the lowest percentage since February 2010.” 1

Dedicated rates, according to Stifel Nicolaus, are expected to remain flat or increase by only 2% while contract rates may actually decrease 1% or increase by 2%.1

For more information regarding the Safety Measurement System and the new Hours of Service rule changes, contact us via the form below or by visiting www.roadscholar.com.

Do you feel that the trucking industry will face greater challenges in 2013?  What is your outlook for volume, rates, and capacity?

1http://fleetowner.com/fleet-management/challenges-continue-grow-carriers

2http://www.supplychaindigital.com/global_logistics/dat-freight-index-reports-record-december-volume

3http://www.thetrucker.com/News/Stories/2013/1/15/OIGinitiatesauditofCSA.aspx

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Only 12% of Active Carriers Contain Sufficient Data for Accurate CSA Rating

Thursday, December 13th, 2012

Shortly after the Federal Motor Carrier Safety Administration (FMCSA) put into effect changes to the CSA’s Safety Measurement System last week, the American Trucking Associations (ATA) released a white paper explaining that “the CSA system lacks sufficient data on the majority of the industry to render meaningful scores for most motor carriers.” 1

According to the ATA, the FMCSA “has sufficient violation data to assess 40% of active carriers in at least one category but only enough to assign a percentile rank or score in at least one category to 12% of active carriers,” which the FMCSA claims is non-problematic since ‘those carriers are involved in 83% of the crashes.’” 1

But the ATA emphasizes that many accidents are not even reported to the FMCSA (less than 75% according to the University of Michigan Transportation Research Institute), leading to inaccurate CSA ratings.

The FMCSA believes that their statistics are accurate due to utilization of their State Safety Data Quality (SSDQ) system, which estimates the number of non-fatal accidents by looking into the number of fatal crashes, comparing these estimates with the number of actual reported non-fatal crashes, giving those states a rating of “good,” “fair,” or “poor.” 2

Although the FMCSA’s findings note that the majority of states are classified as being “good” when indicating their crash numbers, the ATA points out three main flaws that lead these results to be considered inaccurate.

*The FMCSA model of determining whether or not a state is doing an appropriate job in reporting non-fatal accidents is too broad, giving the state a wide threshold to report numbers in.  For instance, “Texas needed to transmit between 12,551 and 25,163 accidents, a range of 12,612 accidents,” a number that far exceeds accuracy. 3

*Although the number of reported non-fatal accidents may only slightly vary in small states year after year, the FMCSA’s threshold varies depending on the number of fatal accidents in that state.  As the ATA noted, “Alaska experienced an annualized fatal accident count of between 1 and 3 for each month in 2012.  When the annualized count was 3, the model expected between 58 and 136 non-fatal, reportable accidents, a range of 78. When the annualized count was 1, the model predicted between 17 and 47 accidents, a range of 30.” 2 The ATA concluded that the number of fatal accidents is not a reliable indicator in determining the number of non-fatal accidents in a state.

*Finally, although the FMCSA claims that most states do a “good” job in reporting crash statistics, which the agency considers as evidence that their ratings are accurate; the previous explanations explain these numbers as unreliable.

The ATA concluded by stating that “Thorough examination of state police accidents reports (PAR) remains the only way to accurately measure State accident reporting to MCMIS.” 2

Read the ATA’s White Paper: Underreporting of Commercial Motor Vehicle Crashes:  Assessment of FMCSA’s Crash Reporting Measurement Tool December 2102 at

http://www.trucking.org/Miscellaneous%20Documents/12%204%2014%20-%20Underreporting%20of%20Crashes%20December%202012%20Final.pdf.

Do you agree with the ATA that the FMCSA’s CSA system contains insufficient data?  What do you find to be the consequences of having this “inaccurate” in the system?

1http://www.supplychaindigital.com/global_logistics/ata-speak-out-about-csa-data-limitations

2http://www.trucking.org/Miscellaneous%20Documents/12%204%2014%20-%20Underreporting%20of%20Crashes%20December%202012%20Final.pdf

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Changes Go into Effect as ATRI Releases New Survey on CSA Implications

Friday, December 7th, 2012

Last Monday, the Federal Motor Carrier Safety Administration (FMCSA) put into effect changes to the CSA’s Safety Measurement System (SMS 3.0).  These changes include changing the Cargo-Related BASIC to the HM Compliance BASIC and the Fatigued Driving BASIC to HOS Compliance BASIC, as well as including violations from the Cargo-Related BASIC category (such as cargo/load securement violations) in the Vehicle Maintenance category.  View changes here.

Last Tuesday, the American Transportation Research Institute (ATRI) published their recent survey “Compliance, Safety, Accountability: Evaluating a New Safety Measurement System and Its Implications,” which pulled input from over 7,000 individuals including drivers, carriers, and law enforcement officials.

Although in last year’s survey, ATRI explained that with stricter regulations, CSA is predicted to remove 10-20% of drivers from the industry, the recent findings demonstrate this number to actually be much lower.  According to the survey, “close to 90 percent of carriers have fired from 0 percent to just 5 percent of their workforce.” 1

Despite an increasing driver shortage, and thus, capacity restraints, employers have increased their standards in the hiring process.  “Employers report less leeway when evaluating driver applicants’ driving records compared to current employees,” the report said. “This makes sense since employers have more extensive knowledge of current drivers than of applicants, including insights into personality traits, behavioral patterns and home lives; therefore, employment decisions can often factor in information beyond a driver’s MCMIS or MVR data (not to mention, employers may be privy to explanations behind safety infractions or FMCSR violations).” 1 With that in mind, nearly two-thirds of those drivers currently employed are still concerned about losing their job due to stricter regulations. 2

83% of carriers are finding it difficult to find qualified drivers, this number increasing from 72% reported last year, according to ATRI’s survey.  This number is plausible given ATRI’s results regarding driver knowledge towards CSA.

According to the report:

  • “Large percentages of drivers still report receiving little to no training on CSA.” 2
  • “96.0% of drivers did not know that FMCSA enforcement staff are the only group of people who can access official driver scores.” 2
  • “92.4% of drivers could not correctly identify which 5 carrier BASIC scores are publicly available.” 2
  • “50.1% of drivers were unaware that past violations and crashes are weighted by both time and severity.” 2
  • “Nearly one quarter (23.2%) of driver respondents have no knowledge that DataQs exists, and only 7.8 percent have used it to contest negative information believed to be in error.” 2

In addition to driver knowledge, the survey analyzed carrier usage of CSA, finding that a whopping 96% of carriers have accessed CSA at some point.  According to results:

28.3% access their CSA scores daily

55.4% monthly

11.7% occasionally

3.3% have not yet accessed their CSA scores

1.2% have no interest

Would you ship with those companies not interested in their safety scores?  Do you think they are concerned about hiring safe, qualified drivers?

You can get your copy of ATRI’s “Compliance, Safety, Accountability: Evaluating a New Safety Measurement System and Its Implications” report at www.atri-online.org.

Do you find that employers are being tougher when hiring drivers due to CSA or more lenient due to driver shortage?

apply

1http://www.thetrucker.com/News/Stories/2012/12/4/NewATRIsurveyCSAdidnthurtdriveravailabilityasmuchasthought.aspx

2ATRI’s “Compliance, Safety, Accountability: Evaluating a New Safety Measurement System and Its Implications” report

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