Heavy Duty Trucking

DEC 2014

The Fleet Business Authority

Issue link: https://heavydutytrucking.epubxp.com/i/432752

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52 HDT • DECEMBER 2014 www.truckinginfo.com loads from intermodal to truckload and vice versa. Today, the mix of modes the shipper uses on Friday may be different from what it uses on Monday. And look at Amazon.com, Larkin said, which "has redefined the supply chain around e-commerce." Instead of regional DCs and using FedEx or UPS for delivery, Amazon is opening fulfillment centers in the middle of cities and operating its own delivery trucks. And then there are those drones… Hours of service and electronic logs 13 On the regulatory front, the big rule due in 2015 will be the electronic log mandate. Besides requiring most drivers to eventually switch from paper to electronic logs, it will set standards for the devices and the supporting documents that regulators need to confirm com- pliance. It also will ensure that electronic logs are not used to harass drivers. Carriers will have two years to comply with the requirements, but attorney Moseley is advising clients to go to electronic logs quickly. "With the CSA's relative system, if everyone else goes to electronic logs and you are still on paper, you will be the one accruing most of the violations," he explains. Also high on the trucking indus- try's list of concerns is the 34-hour restart provision of the hours of service rule. The provision requires drivers to take off two periods between 1 a.m. and 5 a.m. during their restart. The Federal Motor Carrier Safety Administration says this will improve safety because night- time sleep is more restorative than daytime sleep. ATA opposes this restriction, will continue to be investigated and adopted by fleets where it makes operational and financial sense. For many companies, using alter- native fuels or Smartway-member fleets are part of corporate-wide sus- tainability goals. And even at lower prices, fuel is still one of carriers' largest costs. A new report from ACT Research projects that Class 8 penetration of natural gas power will total 23% of the units sold in 2025. Changes in manufacturing & supply chains 12 Retailers and others are beginning to put distri- bution centers closer to their customers to meet the demands for same- day delivery. Some are putting DCs right next to rail lines to maximize their use of intermodal. Some companies are bringing manufacturing facilities back to North America instead of Asia. The boom in gas and oil production due to the advent of fracking technolo- gies means relatively cheap energy for manufacturing. And increas- ingly sophisticated manufacturing technology, such as automated robots and 3-D printing, means companies don't need to go oversees to access low-cost labor anymore, Larkin says. Shippers also are moving to "continuous optimization" of their supply chains, Larkin says. "Back in the old days, maybe every five years, someone would say, 'let's run your freight through the optimiza- tion model" and maybe move a few distribution centers or change a few Management, predicts increased use of telematics, especially in heavy- duty trucks. Telematics devices are used for idle time reduction, moni- toring policy abuse, route optimiza- tion or PM scheduling. No matter what industry you're in, he says, telematics "can show you what you've been missing by provid- ing better insight into your fleet and can help you execute on scalable improvement plans, change driver behavior – which is key for ROI – and measure results." Downsizing and rightsizing medium-duty fleets 10 "We are increasingly hearing about fleet managers' desire to build trucks with the GVWR of 26,000 or lower," Zambroski says. "The need for Commercial Driver's Li- cense for vehicles of 26,001 GVWR and higher deters fleet managers from purchasing such trucks if not absolutely necessary." Large companies such as FedEx and UPS have for a number of years been moving from larger package- truck vehicles to smaller Sprinter cargo vans to save on fuel and other costs. Other manufacturers are now offering these Euro-style vans, so we expect to see the trend continue, even among smaller fleets. Growing focus on fleet sustainability 11 2015 could see the cheapest diesel fuel in years. The Department of Energy's November Short-Term Energy Out- look reported that diesel fuel prices, which averaged $3.92 per gallon in 2013, are projected to fall to an average of $3.82 for 2014 and $3.38 in 2015. Nevertheless, fuel economy technologies and alternative fuels Diesel fuel prices, which averaged $3.92 per gallon in 2013, are projected to fall to an average of $3.38 in 2015. – U.S. Department of Energy top trends

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