How the ELD Mandate Has Affected Shippers

Written by Nicola Malaney
    

Truck Driver Holding a TabletIn 2017, we wrote about the looming capacity concerns in both the truckload and LTL industries and how the electronic logging device (ELD) mandate requirements will change these industries.

At the time, the thought of ELDs replacing paper logbooks truckers used to record their compliance with hours of service (HOS) requirements caused an uproar within the trucking and logistics industry.

In this blog, we’ll discuss the ELD mandate, who it affects, what compliance looks like and what’s been the real impact on shippers.

What Is the ELD Mandate?

To refresh, the ELD mandate is intended to help create a safer work environment for drivers and make it easier to accurately track, manage and share records of duty status data.

According to the Federal Motor Carrier Safety Administration (FMCSA), the ELD mandate:

  • Requires ELD use by all drivers who operate commercial motor vehicles (CMVs) and are required to prepare HOS records of duty status (RODS). The Department of Transportation (DOT) defines a CMV as being a vessel that:
    • Weighs 10,001 pounds or more
    • Rates at a gross vehicle weight or combination weight rating of 10,001 pounds or more
    • Transports 16 or more passengers, including the driver (not for compensation)
    • Transports nine or more passengers, including the driver (for compensation)
    • Transports hazardous materials that require placards
  • Sets ELD performance and design standards and requires ELDs to be certified and registered with FMCSA. Establishes what supporting documents drivers and carriers are required to keep. Prohibits harassment of drivers based on ELD data or connected technology (such as a fleet management system). The rule also provides recourse for drivers who believe they have been harassed.

On Dec. 16, 2019, the full compliance phase began, requiring all drivers and carriers operating in the U.S. to track HOS using only registered and compliant ELDs. The ELD mandate is estimated to affect 3.1 million trucks and 3.4 million drivers, according to the FMCSA.

A violation of the ELD mandate can affect a driver’s Compliance, Safety and Accountability (CSA) score, as well as lead to:

  • Fines ranging from $1,000 to $10,000
  • Increased chances of roadside inspections
  • Drivers being placed out-of-service for a minimum of 10 hours

The ELD Mandate’s Impact on the Trucking Industry

According to the language of MAP-21 (Moving Ahead for Progress in the 21st Century Act), the goal of the ELD mandate was to improve HOS compliance. While the graph below shows that ELDs haven’t entirely eliminated cheating, the ELD mandate is working, with HOS violations dropping significantly in fiscal year 2019 for truck drivers exceeding daily driving and on-duty limits.

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Longer Transit Times

Due to the ELD mandate, both shippers and receivers relying on FTL and LTL freight have had to alter their expectations for on-time deliveries. With ELDs tracking every second, most carriers can only make next-day deliveries on shipments no more than 500-550 miles. Drivers are on the clock for 10 hours per day. Once you take waiting times to load and unload into consideration, only 7-8 hours are actually spent driving. Many shipments that could have previously been delivered in one day now require a transit time of two days.

Increased Rates & Tighter Capacity

Because the ELD mandate limits the amount of working time a driver has available, they can’t deliver as many shipments as they once used to. As a result, carriers and shippers are noticing a rise in LTL and FTL pricing. Carriers have had to change rates in some lanes accordingly to earn the revenue they need to remain financially healthy.

Longer transit times and higher rates put a greater focus on the driver shortage, making it a wise decision for shippers to turn to third-party logistics (3PL) providers.

Interested in learning more about the ELD mandate and its impact on carriers and shippers? Contact us today!

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