Supply Chain Commentary: 3 Ways to Prepare for the ELD Mandate
The upcoming electronic logging device (ELD) mandate affects more than just the carriers and owner/operators that will be directly responsible for using the devices in their trucks. It’s truly a law that could change the entire trucking industry. And your truckload strategy may need to adjust accordingly.
ELD Mandate: The Benefits
Before delving deeper, we need to understand why the ELD mandate is going into effect at all. The number one reason for the mandate is safety.
According to the FMCSA, compliance with the ELD mandate has the potential to prevent approximately 1,500 crashes, 475 injuries, and 22 deaths each year.
Beyond safety reasons, the ELD mandate also opens the possibility that as carriers have more access to data (from the accurate ELD recordings), they’ll be able to offer more efficient strategies when accepting truckload freight than ever before.
ELD Mandate: Potential Drawbacks
I can’t predict the future, but there are several challenges that many are speculating on regarding the implementation of the ELD mandate. The biggest potential challenges include:
- Less tolerance for dwell time. Organized and efficient loading/unloading times will become even more important. Reducing driver wait time at either the origin or destination can have a significant impact on a driver’s hours of service (HOS).
- Expanded need for team drivers. Team drivers might become more attractive as they decrease truck downtime by preventing solo drivers from reaching their HOS. If enough drivers pair up, this could potentially affect both capacity availability and overall rates.
- Reduced truckload capacity. Carriers that don’t want to implement an ELD could close up shop rather than become compliant. If enough companies follow this approach, there could be an impact on available equipment.
- Increased shipping costs. Carriers may look to offset their investment in an ELD—especially if monthly fees are involved—by passing the costs on to the shippers they work with. Tightening capacity could also contribute to higher rates.
To what extent, if any, these may affect your business is unforeseeable and is likely dependent on how many carriers try to remain non-compliant, and how those who are compliant are implementing the change.
3 Ways to Prepare Before the ELD Mandate Goes into Effect
- Open the lines of communication. Now is the time to discuss the mandate with the truckload carriers and providers you work with regularly. An open conversation can help you find out what their plans are for compliance and may show you areas that will need to change before crunch time.
- Clearly set your expectations. When discussing the mandate with your regular carriers and providers, be able to provide specific details about what you expect. If you expect compliance with the regulation, have a date in mind. If you will ask each carrier to submit proof of their ELDs, make sure they know what documents you will and won’t accept. These kinds of details are what can truly keep small speed bumps from becoming roadblocks.
- Support carriers in new ways. The ELD mandate may present new opportunities to change your relationship with key carriers. At C.H. Robinson, we’re supporting our carriers by providing a low-cost and simple ELD solution through ONE20. Offering support—in whatever way works for your organization—is a smart and helpful way to promote compliance by the deadline.
Educate Your Company
Because the ELD mandate could potentially affect several areas of your business, it will be important to be well informed on about how ELDs affect your business and the overall market. There are a variety of resources available, including those from FMCSA that can help.