The days when heavy trucks idle away the evening at truck stops and freight yards may be numbered. States and municipalities are cracking down on the practice, and DCs may be forced to follow suit.
Peter Bradley is an award-winning career journalist with more than three decades of experience in both newspapers and national business magazines. His credentials include seven years as the transportation and supply chain editor at Purchasing Magazine and six years as the chief editor of Logistics Management.
Old habits can be hard to break. But if it's a habit of idling a truck engine for hours on end, drivers might not have much choice in the matter. States and municipalities nationwide are cracking down on the practice, adopting new antiidling regulations (20 states now have restrictions) and stepping up enforcement of existing rules. These are no idle threats: Flout the regulations, and you risk a hefty fine.
But drivers risk more than fines if they don't kick the idling habit. They could also find themselves in hot water with their employers. Though they haven't always seemed terribly concerned about the practice, truckers today have become almost fervent in their zeal to minimize idling—and with good reason. Along with the potential legal exposure, they have powerful environmental (not to mention, public relations) incentives to reduce air pollution caused by idling trucks. And with diesel prices approaching a national average of $3 a gallon, their concerns about wasting fuel require no explanation.
For the nation's truckers, reducing idling could have a potentially enormous payoff. A typical long-haul tractor idles approximately 1,830 hours per year, according to the U.S. Department of Energy's Clean Cities program. Every year, U.S. trucks collectively burn more than 800 million gallons of diesel fuel while idling. The cost of that wasted fuel? Close to $3 billion a year.
A war on idling
Given those numbers, it's hardly surprising that truckers of all stripes—private fleets, truckload and less-than-truckload carriers, and small-package carriers—are vowing to cut back on idling. "Reducing idling makes great business sense," says Jim O'Neal, chairman of the Truckload Carriers Conference and president of O&S Trucking in Springfield, Mo. "It is a total waste of fuel and has a high maintenance cost to it. I'm not sure why we've done it all these years." Adds Dan Smith, corporate director of transportation for Smart & Final, a West Coast grocer that runs a private fleet of 55 tractors and 250 trailers, "Keeping idling to a minimum is good for the environment and good for the company."
As for how they're going about it, carriers have taken a variety of approaches. Some, like UPS Freight (the former LTL carrier Overnite Transportation), have chosen the technology route. UPS Freight has programmed its fleet vehicles' engines to turn off after five minutes of idling.
Others have taken what could be termed the behavior modification approach, rewarding drivers for cutting down on idling. Smart & Final, for example, offers additional compensation to drivers who avoid unnecessary idling. Smith reports that the strategy is working well. "Drivers are keyed into that. You rarely drive into one of our facilities and see a tractor idling."
Schneider National, the nation's largest truckload carrier, also rewards drivers for reducing idling time. Dennis Damman, Schneider's director of engineering, says the company asks drivers to idle their trucks only when the outside temperature drops below 10 degrees F. (Idling at low temperatures is necessary because it's difficult to start diesel engines when it is very cold.) Damman reports that the policy has been working. "Last January is a great example," he says. "We had 7,000 trucks that idled less than 5 percent of the time."
Carriers are also working with regulatory agencies to clean up their collective act. To date, well over 300 truckers (and a number of shippers) have joined the Environmental Protection Agency's SmartWay Transport Program. SmartWay, which includes an idling-reduction program, is a voluntary public-private partnership aimed at improving fuel efficiency and reducing greenhouse gas emissions in the freight transportation industry. Schneider National and O&S Trucking are both members of SmartWay, as is national LTL carrier FedEx Freight. "We view that as a commitment to our communities," says Doug Duncan, president of FedEx Freight.
No place for idling
The increase in state and local anti-idling ordinances might seem only peripheral to DC operations, but that's actually not the case. Though the regulations have the most direct effect on truckers, they're likely to have an impact on shipping and receiving operations as well.
Wal-Mart can attest to that. In 2005, the mega-retailer was fined by the Environmental Protection Agency (EPA) for clean air violations caused by idling trucks. In the fall of 2004, EPA inspectors had observed trucks owned by Wal-Mart and by other trucking companies idling for long periods at six different Wal-Mart properties in Connecticut and Massachusetts.
As part of the settlement, Wal-Mart agreed to pay a $50,000 penalty and establish idle-reduction programs at all of its facilities nationwide. The retailer also agreed to notify other delivery companies that idling is not permitted on Wal-Mart property and may violate state or local idling restrictions.
With the settlement behind it, Wal-Mart now prefers to frame its anti-idling initiatives as part of its broader environmental sustainability crusade. By establishing a "no idle" policy for its trucks and retrofitting them with high-efficiency generators, Wal-Mart claims it will save 10 million gallons of diesel fuel each year, reducing carbon dioxide emissions by 100,000 tons. It will also save nearly $26 million, according to company statements. (Wal-Mart officials declined to be interviewed for this story.)
Wal-Mart's initiatives have not gone unnoticed by other DC managers. O'Neal believes the retailer's anti-idling efforts have prompted others to follow suit, adding that he sees more shipping facilities establishing anti-idling rules.
One company that has cracked down on idling at its DCs is Smart & Final. Smith says the company has instructed inbound dry freight carriers not to idle in its yards, although he notes that the grocer makes an exception for temperature-controlled carriers that must run their engines to keep trailer-cooling systems operating.
What DCs can do
When it comes to discouraging idling, DCs have a huge role to play—one that goes well beyond simply handing down anti-idling rules, according to John Gentle. Gentle, the former global transportation leader at Owens Corning and now an independent consultant, believes DCs bear much—if not most—of the responsibility for the idling that takes place on their premises. And while creating anti-idling policies is a good start, Gentle maintains there's much more DCs can do.
To begin with, Gentle urges shippers and receivers to offer decent accommodations for drivers waiting for their trailers to be loaded or unloaded. When drivers are forced to sit in their rigs while awaiting their turn at the dock, they have no choice but to keep their engines running in order to maintain a comfortable cab temperature. That wouldn't be necessary if they had an acceptable place to wait, argues Gentle, who notes that he's seen some pretty small, uncomfortable waiting areas for drivers.
Offering comfortable quarters isn't just good business, Gentle says; it's basic decency. "Quite honestly, if shippers knew what some DCs looked like and how people are treated, they would be offended," he adds. "I'm not saying it's typical, but it is not an unfamiliar conversation."
The other thing DC managers can do, Gentle says, is take a candid look at their scheduling practices. Addressing any scheduling issues is imperative to reducing waiting—and therefore, idling—time. A history of long waiting times is an indication that DC operations are less efficient than they should be, he says. "If you cannot move a driver in and out, that's a problem."
Gentle adds that he doesn't buy the excuse that DCs have little control over what goes on outside their premises. "People say they measure from the time a truck pulls into the gate," he says. "That's a bunch of baloney. If a trucker is waiting two miles up the road to get in, you are kidding yourself."
Duncan of FedEx Freight agrees with Gentle that many DC traffic backups can be traced to scheduling problems. Noting that carriers are often willing to work with customers to improve turn times, he urges shippers experiencing tie-ups to take advantage of their truckers' expertise. Duncan adds that FedEx has found that setting up appointments at shipping and receiving locations can make a big difference in smoothing the flow of traffic.
Keeping their cool
In their zeal to put a stop to idling, state and municipal governments have inadvertently created a dilemma for long-haul truck drivers. What some (though not all) of the regulations fail to consider is that drivers need a way to heat or cool their sleeper cabs during their federally mandated rest periods. In the past, that has generally meant keeping their tractors running all night long. Now, bans in some areas are forcing drivers to choose between violating the law and risking heat exhaustion or hypothermia.
To address the heating and cooling issue, fleets are increasingly turning to technology solutions. They're installing auxiliary power units (APUs), which require only a fraction of the amount of fuel used during idling. Wal-Mart, for example, reports that it installed APUs in its entire fleet last year. According to the EPA, APUs typically consume between 0.05 and 0.2 gallons of fuel per hour, compared to about a gallon per hour for an idling truck.
However, the auxiliary units are costly, which may put them out of reach for many smaller carriers. "The expense is rather large," says O'Neal. "Certainly, the return on invested capital is there, but they are still too expensive."He adds that truck makers are currently developing low-power heating and cooling units that could be specified as original equipment on a vehicle. But he notes that the technology is still four to six years away.
At least one of the major players is searching for a system that doesn't require the use of diesel at all. Damman says that although Schneider has not decided on a technology for cooling tractor interiors without running the engine, it would like to find a battery-operated system. The company currently has 200 tractors in test programs for engine-off air conditioning equipment. "I think in the near future, we will find a cab-cooling solution," he says.
As for what lies ahead on the anti-idling front, carriers are generally optimistic about their prospects for reining in the practice. Duncan, for one, is confident that truckers and their equipment suppliers will succeed in getting better mileage from their equipment and reducing emissions, though he admits that both tasks seem daunting. "We have to do both and we can do both," he says. "If you look at it from a macro level, it looks impossible. You have to do it a piece at a time."
For both truckers and DC managers, the benefits of reducing idling go well beyond regulatory compliance or public relations, says Gentle. It's also good business, he says, citing the potential payoffs in better fuel mileage and more efficient DC operations. "We really need to do a better job of managing the challenge," he adds. "We will have less pollution and better asset utilization. It should really be about that, not the EPA."
"but officer, the sign said the county line was back there …"
The right thing to do shouldn't be the hard thing to do. But for truckers trying to stay in compliance with a vast array of state and local anti-idling ordinances, that's all too often the case.
In the absence of federal rules, the nation has ended up with a crazy quilt of state and municipal regulations, whose time limits, penalties, and exemptions vary widely from city to city and state to state. As things stand now, truckers driving across, say, northern Nevada had better figure out what county they're in before stopping to take a 20minute break. If they're in Humboldt County, they can safely leave the engine running. But if they're in neighboring Washoe County, they'd better turn it off—Washoe County bans idling for more than 15 minutes. (The American Transportation Research Institute maintains a list of state and municipal antiidling regulations as well as a downloadable cab card on its Web site. Visit www.atri-online.org and click on Idling Regulations Compendium.)
Fearing that the confusion would only worsen as more states and municipalities adopted anti-idling regulations, the Environmental Protection Agency (EPA) in 2004 announced that it would develop a model anti-idling law for states to use as a guideline. After soliciting suggestions during a series of public workshops held around the country, the agency unveiled a model law last May. The model, which has no regulatory weight, generally limits heavy-truck engines from idling for more than five minutes. Of particular interest to DC managers, it also prohibits shipping or receiving locations from causing trucks to idle for more than 30 minutes while waiting to load or unload. For a look at the model, visit www.epa.gov/smartway. Click on Idling Reduction, then on State Laws.
Jeremy Van Puffelen grew up in a family-owned contract warehousing business and is now president of that firm, Prism Logistics. As a third-party logistics service provider (3PL), Prism operates a network of more than 2 million square feet of warehouse space in Northern California, serving clients in the consumer packaged goods (CPG), food and beverage, retail, and manufacturing sectors.
During his 21 years working at the family firm, Van Puffelen has taken on many of the jobs that are part of running a warehousing business, including custodial functions, operations, facilities management, business development, customer service, executive leadership, and team building. Since 2021, he has also served on the board of directors of the International Warehouse Logistics Association (IWLA), a trade organization for contract warehousing and logistics service providers.
Q: How would you describe the current state of the contract warehouse industry?
A: I think the current state of the industry is strong. For those that have been focused on building good client relationships over the years, I think it’s a really exciting time. Coming out of all the challenges of the past few years, I think there’s a lot of opportunity for growth and deeper partnerships. It’s fun to see the automation and AI (artificial intelligence) integration starting to evolve [in a way that’s] similar to what we saw with WMS (warehouse management systems) in the early 2000s.
Q: You are now president of your family firm. Is it an advantage having grown up in the business as opposed to working elsewhere?
A: I definitely believe it was an advantage growing up in the business. Whether it’s working with family or someone else in the industry, there’s always an advantage when you have mentors[to guide] you. I’ve been blessed to have several mentors, some in the industry, others just in life, and I’m thankful that they were willing to mentor me and that I was willing to listen to them.
Q: What are the biggest challenges currently facing 3PLs, and how are you addressing them?
A: Labor and legislation are both tough right now. The two seem to have a lot to do with each other, and it can make it tough to find and retain people. So I think we’ll see more and more automation of processes industrywide.
Q: Third-party service providers often must handle a wide variety of products for a lot of different clients. Does this variety make it difficult to invest in automation and other new technologies?
A: It can make things more difficult when looking at certain automation, but it’s in the “difficult” that a lot of opportunities lie. It would be tough to find a single solution that fits every client’s needs, but there are always opportunities to improve in certain areas. It just takes a bit of vision and commitment, and a willingness to invest in your own long-term success.
Q: As a 3PL, what do you look for when selecting the clients you work with?
A: Quality relationships that will last a long time. When both parties are happy and working together in the same direction, everyone wins.
Q: You’ve been a board member of the International Warehouse Logistics Association since 2021. Why is your involvement with this organization important to you?
A: I think it’s important to understand what’s happening in the industry. IWLA is a great resource for staying up to date and getting a solid education when it comes to the latest logistics trends. I also think it’s important to give back and pass along what we’ve learned to those just getting started in the business. As important as it is to have a mentor, it’s just as important to mentor and help others.
“While there have been some signs of tightening in consumer spending, September’s numbers show consumers are willing to spend where they see value,” NRF Chief Economist Jack Kleinhenz said in a release. “September sales come amid the recent trend of payroll gains and other positive economic signs. Clearly, consumers continue to carry the economy, and conditions for the retail sector remain favorable as we move into the holiday season.”
The Census Bureau said overall retail sales in September were up 0.4% seasonally adjusted month over month and up 1.7% unadjusted year over year. That compared with increases of 0.1% month over month and 2.2% year over year in August.
Likewise, September’s core retail sales as defined by NRF — based on the Census data but excluding automobile dealers, gasoline stations and restaurants — were up 0.7% seasonally adjusted month over month and up 2.4% unadjusted year over year. NRF is now forecasting that 2024 holiday sales will increase between 2.5% and 3.5% over the same time last year.
Despite those upward trends, consumer resilience isn’t a free pass for retailers to underinvest in their stores by overlooking labor, customer experience tech, or digital transformation, several analysts warned.
"The 2024 holiday season offers more ‘normalcy’ for retailers with inflation cooling. Still, there is no doubt that consumers continue to seek value. Promotions in general will play a larger role in the 2024 holiday season. Retailers are dealing with shrinking shopper loyalties, a larger number of competitors across more channels – and, of course, a more dynamic landscape where prices are shifting more frequently to win over consumers who are looking for great deals,” Matt Pavich, senior director of strategy & innovation at pricing optimization solutions provider Revionics, said in an email.
Nikki Baird, VP of strategy & product at retail technology company Aptos, likewise said that retailers need to keep their focus on improving their value proposition and customer experience. “Retailers aren’t just competing with other retailers when it comes to consumers’ discretionary spending. If consumers feel like the shopping experience isn’t worth their time and effort, they are going to spend their money elsewhere. A trip to Italy, a dinner out, catching the latest Blake Lively and Ryan Reynolds films — there is no shortage of ways that consumers can spend their discretionary dollars,” she said.
Editor's note:This article was revised on October 18 to correct the attribution for a quote to Matt Pavich instead of Nikki Baird.
The market for environmentally friendly logistics services is expected to grow by nearly 8% between now and 2033, reaching a value of $2.8 billion, according to research from Custom Market Insights (CMI), released earlier this year.
The “green logistics services market” encompasses environmentally sustainable logistics practices aimed at reducing carbon emissions, minimizing waste, and improving energy efficiency throughout the supply chain, according to CMI. The market involves the use of eco-friendly transportation methods—such as electric and hybrid vehicles—as well as renewable energy-powered warehouses, and advanced technologies such as the Internet of Things (IoT) and artificial intelligence (AI) for optimizing logistics operations.
“Key components include transportation, warehousing, freight management, and supply chain solutions designed to meet regulatory standards and consumer demand for sustainability,” according to the report. “The market is driven by corporate social responsibility, technological advancements, and the increasing emphasis on achieving carbon neutrality in logistics operations.”
Major industry players include DHL Supply Chain, UPS, FedEx Corp., CEVA Logistics, XPO Logistics, Inc., and others focused on developing more sustainable logistics operations, according to the report.
The research measures the current market value of green logistics services at $1.4 billion, which is projected to rise at a compound annual growth rate (CAGR) of 7.8% through 2033.
The report highlights six underlying factors driving growth:
Regulatory Compliance: Governments worldwide are enforcing stricter environmental regulations, compelling companies to adopt green logistics practices to reduce carbon emissions and meet legal requirements.
Technological Advancements: Innovations in technology, such as IoT, AI, and blockchain, enhance the efficiency and sustainability of logistics operations. These technologies enable better tracking, optimization, and reduced energy consumption.
Consumer Demand for Sustainability: Increasing consumer awareness and preference for eco-friendly products drive companies to implement green logistics to align with market expectations and enhance their brand image.
Corporate Social Responsibility (CSR): Companies are prioritizing sustainability in their CSR strategies, leading to investments in green logistics solutions to reduce environmental impact and fulfill stakeholder expectations.
Expansion into Emerging Markets: There is significant potential for growth in emerging markets where the adoption of green logistics practices is still developing. Companies can capitalize on this by introducing sustainable solutions and technologies.
Development of Renewable Energy Solutions: Investing in renewable energy sources, such as solar-powered warehouses and electric vehicle fleets, presents an opportunity for companies to reduce operational costs and enhance sustainability, driving further market growth.
A real-time business is one that uses trusted, real-time data to enable people and systems to make real-time decisions, Peter Weill, the chairman of MIT’s Center for Information Systems Research (CISR), said at the “IFS Unleashed” show in Orlando.
By adopting that strategy, they gain three major capabilities, he said in a session titled “Becoming a Real-Time Business: Unlocking the Transformative Power of Digital, Data, and AI.” They are:
business model agility without needing a change management program to implement it
seamless digital customer journeys via self-service, automated, or assisted multi-product, multichannel experiences
thoughtful employee experiences enabled by technology empowered teams
And according to Weill, MIT’s studies show that adopting that real-time data stance is not restricted just to digital or tech-native businesses. Rather, it can produce successful results for companies in any sector that are able to apply the approach better than their immediate competitors.
However, that trend is counterbalanced by economic uncertainty driven by geopolitics, which is prompting many companies to diversity their supply chains, Dun & Bradstreet said in its “Q4 2024 Global Business Optimism Insights” report, which was based on research conducted during the third quarter.
“While overall global business optimism has increased and inflation has abated, it’s important to recognize that geopolitics contribute to economic uncertainty,” Neeraj Sahai, president of Dun & Bradstreet International, said in a release. “Industry-specific regulatory risks and more stringent data requirements have emerged as the top concerns among a third of respondents. To mitigate these risks, businesses are considering diversifying their supply chains and markets to manage regulatory risk.”
According to the report, nearly four in five businesses are expressing increased optimism in domestic and export orders, capital expenditures, and financial risk due to a combination of easing financial pressures, shifts in monetary policies, robust regulatory frameworks, and higher participation in sustainability initiatives.
U.S. businesses recorded a nearly 9% rise in optimism, aided by falling inflation and expectations of further rate cuts. Similarly, business optimism in the U.K. and Spain showed notable recoveries as their respective central banks initiated monetary easing, rising by 13% and 9%, respectively. Emerging economies, such as Argentina and India, saw jumps in optimism levels due to declining inflation and increased domestic demand respectively.
"Businesses are increasingly confident as borrowing costs decline, boosting optimism for higher sales, stronger exports, and reduced financial risks," Arun Singh, Global Chief Economist at Dun & Bradstreet, said. "This confidence is driving capital investments, with easing supply chain pressures supporting growth in the year's final quarter."