Survey finds larger truck fleets ready for ELD mandate; small firms, not so much

A survey released today by a leading third-party logistics provider came to the rather unsurprising conclusion that larger trucking firms have been more engaged in installing electronic logging devices (ELDs) than their smaller brethren.

The survey, conducted over the past few months by Dallas-based Transplace, canvassed more than 400 motor carriers of various sizes. It found that 81 percent of large fleets—firms with more than 250 trucks—had achieved full ELD implementation. The survey found that the remaining 19 percent were working toward full implementation, which, barring a court decision to overturn the rule, is scheduled to take effect across the industry on Dec. 16, 2017, according to Department of Transportation (DOT) regulations.

By contrast, only one-third of fleets with less than 250 trucks have fully installed ELD equipment and systems, the survey found. About 29 percent have begun the implementation process, while the remaining 38 percent have no immediate plans to begin implementation, according to the survey.

Many large fleets have voluntarily installed ELDs in their cabs over the past few years. Many reported initial cost and productivity hiccups, but those problems have generally disappeared. Smaller fleets and owner-operators, which operate by the seat of their pants and are already burdened with significant costs, may find the cost and productivity hits to be too much to manage.

Still, ELD implementation is seen as imposing a uniform hit if and when the rules are finalized, the survey found. About 56 percent of large carriers expect their capacity levels or their equipment utilization to decline. Smaller carriers appear to be more concerned, with 64 percent expecting their fleet utilization to be negatively affected, according to the survey.

An anticipated decline in fleet utilization could stem from drivers exiting the industry as a result of the mandate. Slightly more than half of the respondents said they have lost drivers who did not want to operate under ELDs. Most noted that the driver attrition has been minor, the survey found. However, one carrier respondent said it lost half its drivers when it switched from traditional paper logs to electronic logs.

According to the survey, 45 percent said ELD compliance, which covers buying and deploying the equipment, would translate into a per-unit cost of about $700. About 18 percent said the cost would range between $500 and $700 per unit, while 19 percent expected the cost per unit to fall between $300 and $500. The cost estimates do not include any hits from diminished productivity; analysts have said fleet productivity will take a low- to mid-single-digit hit due to ELD implementation.

For supporters of ELD implementation, the survey brought some positive news. Of the carriers that have installed ELDs, 84 percent of large fleets and 56 percent of smaller fleets have reported a reduction in the frequency of federal driver hours-of-service (HOS) and logging violations. About one-third of all respondents said they expect ELD compliance to improve their fleet-monitoring efforts. ELDs will track a vehicle's location, but not a driver's whereabouts at a given point in time.

Many smaller operators may be hanging back to see how the legal battle over ELDs plays out before deciding whether to commit. A hearing was held yesterday in federal appeals court in Chicago to hear arguments in a suit filed by the Owner-Operator Independent Drivers Association (OOIDA), which represents owner-operators and micro fleets, to block the rules. OOIDA has argued that an order to install an ELD device for prolonged use without a warrant represents an unconstitutional search and seizure under the Fourth Amendment.

Because drivers must still manually input changes in their duty status, the rule fails to comply with a congressional statute requiring ELDs to accurately and automatically record those changes, according to OOIDA. As a result, the devices are no more reliable than paper logbooks for recording hours-of-service compliance, it said.

In 2011, the group convinced the courts to block rules governing ELD implementation on grounds they failed to do enough to protect drivers from the possibility of harassment by fleet owners and operators. The modified final rule contains significant driver-protection provisions, according to the Federal Motor Carrier Safety Administration (FMCSA), the DOT sub-agency that crafted the regulations.

Norita Taylor, an OOIDA spokeswoman, said the group is confident it can get the rules overturned again.

In a statement, Ben Cubitt, Transplace's senior vice president, consulting and engineering, said most carriers, regardless of size, expect a "noticeable impact to utilization and capacity" from the ELD mandate. The challenge, Cubitt said, will be to "find the right balance of good safety practices without causing a significant disruption to the transportation industry."