With ELD enforcement here, how do supply chains return to 'normal'?
- Enforcement of the electronic logging device (ELD) mandate has been in effect for 10 days now, with shippers, carriers and freight forwarders all figuring out how to adjust their operations for the long term.
- CarrierLists estimates compliance rates are around 97%. Regulators are conducting roadside inspections, and drivers found operating a truck without an ELD are put out of service for 10 hours.
- Amid fears the mandate is exacerbating truck driver shortages, the trucking industry added 6,700 workers in March, according to a report from the Department of Labor, making last quarter the strongest quarter of job growth for trucking since 2012.
Because a strong majority of fleets are in compliance with the mandate, concerns no longer revolve around ELD compliance, but rather the effects of the mandate across industries.
With trucks being an integral part of many supply chains, the ELD mandate has a "ripple effect across all stems," Gary Cardenas, president of TOC Logistics, told Supply Chain Dive.
Supply of both trucks and drivers is low relative to the skyrocketing demand driven by e-commerce, contributing to spot rates going up, creating increased costs for shippers. Carriers' costs are going up too, as they ramp up incentives and pay for drivers, hoping to lessen turnover rates.
For freight forwarding companies like TOC Logistics, serving as the middle man between shippers and carriers is all about efficiency.
"Everything's got to work like clockwork," Cardenas said. "We have to time it out, because we don't want that driver sitting there, tying up driving time that he or she could have on the road."
If a shipper has a specific day and time for a product release, it must ensure its distribution center workers will be ready to load a truck at a particular time, with the carrier scheduling the drive accordingly.
This strategy requires the entire supply chain to have a "unified plan," with each actor realizing the needs and constraints of the others. More planning could lead to a change in value chain relationships, moving away from transactional and toward partnerships.
That process won't be instantaneous. "I don't think we're going to see any kind of normality here in 2018," Cardenas said.
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