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Trucking Industry

Automated Trucking Startup Offers More Questions Than Answers With New Announcement

November 13, 2019 by Levinson and Stefani Leave a Comment

Ike Robotics, Inc. has been using a unique approach to developing and preparing its self-driving commercial trucks for market; however, there are growing concerns that such testing may be far too little to prove truly “safe.” Many have heard the horror stories of self-driving vehicles being tested on the road and the severe risks associated with such tests. The reality is that the companies releasing self-driving functions in their vehicles are doing so at a slow pace as they already know the roads are not quite ready to handle fully autonomous vehicles. For instance, what happens when a vehicle quickly cuts off another driver, or happens to try and dodge a pothole causing them to swerve slightly over the lane? While it is clear that self-driving vehicles have the ability to learn from simulations and situations that occur on the road while the vehicles are driving, there seems to be an issue as to whether testing such vehicles on public roadways is the proper thing to do. These are the exact factors these companies are having to consider to ensure that another Tesla mishap or uber autonomous car incident does not occur. Instead, we have seen auto manufacturers releasing impressive high-tech safety functions for their vehicles, including commercial trucks. Recently, Volvo announced it would be implementing a new driver assistance system that has the ability to automatically press a vehicle’s brakes at a much higher speed under circumstances that would have typically led to a collision. And that’s where the news of Ike’s safety tests for its state-of-the-art trucks comes into play.

Ike recently produced a 90-page safety report it provided to the National Highway Traffic Safety Administration (NHTSA) which outlined that its process for testing was done solely on “simulation and private-track testing,” wrote Automotive News, a newspaper covering the trends of the industry. In addition, the publication reported that Ike’s safety report was the “16th the federal agency has received from industry players and perhaps the first from a company that has yet to test its technology on public roads.” What this shows is that the self-driving technology we continue to hear about in the news from the likes of Tesla and other manufacturers is quickly becoming widespread even though there are already a growing number of concerns surrounding its use. Although Ike’s belief and decision to not test vehicles on the road is understandable and will likely prevent more collisions from occurring in the testing phase, how much “safer” is it to actually withhold testing on roads? It appears that at this time, unfortunately no one really knows, with Volvo’s own executive claiming in July that “measuring progress by miles was ‘a myth,’” stated Automotive News. Although an automobile manufacturing giant such as Volvo certainly has a track record of success in the industry, the reality is that many of the companies involved in actually testing these vehicles happen to be startups similar to Ike. The key word there is “startup.” Unfortunately, while Ike may believe that it is safer for its company to test on a track and under a variety of simulations, it could also be the fact that the company and other startups in this industry do not have the proper amount of funding to actually place a fleet of trucks on the roads for testing. The technology alone for these trucks costs millions of dollars, so for a startup banking on huge success and having to prove themselves to continue gaining the proper funding, this may be something the industry needs to keep a close eye on.

One good sign that startups like Ike may actually be close to bringing safe commercial trucks to the road is the fact that prominent manufacturers of vehicle safety equipment are entering agreements to be suppliers for their trucks. As of October 30, 2019, Ike announced it had selected Ouster, a leading manufacturer of high-resolution lidar sensors used in autonomous vehicles, to be its primary supplier for its fleet of autonomous trucks it plans to roll out. The press release went on to state, “Ouster and Ike share a commitment to commercializing safe, impactful technology by focusing on practically-minded product development.” The hope is that the more autonomous vehicles become a regularity on the road, clearly beginning with non-commercial vehicles, the easier it will be for more companies to continue become the suppliers of these up-and-coming automotive manufacturers. The issue that we clearly see at this time; however, is the reality that these startups are unlike anything we have ever seen. Sure, we often hear about new tech startups in Silicon Valley, but does function potentially place millions of individuals at a physical safety risk like an autonomous vehicle would? This is not to say that autonomous vehicles, especially trucks are not a possibility, but the reality is that there are millions of miles of roads in the United States and each one is going to offer a different scenario for these autonomous trucks to respond to. All in all, safety and ensuring that this next step in technology doesn’t hinder other drivers on the road should be our absolute worry in this stage of the evolution of the trucking industry.

ATRI List Ranks Biggest Trucking Concerns for 2019

November 9, 2019 by Levinson and Stefani Leave a Comment

A new list released by the American Transportation Research Institute–the trucking industry’s non-profit research institute–shows the biggest issues currently facing the trucking industry in North America.

The “Critical Issues in the Trucking Industry” list for 2019 has been compiled by the ATRI after analyzing over 2000 survey responses from motor carriers and commercial truck drivers. In its 15th year, the ATRI Top Industry Issues report also incorporates strategies that can address and potentially help to solve each issue.

In the list, driver pay and detention times at customer facilities made up 2 of the top 10 biggest concerns–for the first time ever.

However, Hours of Service has held the number two spot for two years in a row, and Driver Shortage concerns have stayed at the very top of the list for the last three years. 

“While 2018 was an incredible year for trucking, we’ve seen some challenges in 2019, and certainly finding and retaining qualified drivers remains at the top of the list for our industry,” said ATA chairman and president, Barry Pottle. “ATRI’s analysis reveals the interconnectedness of these top issues and provides a roadmap for how motor carriers and professional drivers believe we should move forward as an industry.”

Here are the 2019 rankings for the most critical worries in the North American trucking industry:

10. Economy — Many factors have truckers concerned lately about how the American economy is affecting trucking, including a trade war with China, drone strikes on Saudi Arabian oil companies, and a softer freight market.

9. Transportation Infrastructure/Congestion/Funding — “Poorly maintained roads and traffic congestion create wear and tear on vehicles, waste fuel and increase emissions, create additional stress for drivers, and negatively impact industry productivity,” the ATRI says.

8. Compliance, Safety, and Accountability (CSA) — Although still a major concern, CSA worries have fallen from the number 6 spot in 2018. This may be in part to the integration of new driver technology, such as collision mitigation, avoidance systems, and driver-facing cameras.

7. The Electronic Logging Device Mandate — December 16th is the deadline for fleets to transition from AOBRD devices to FMCSA-approved ELDs. The logging technology was the number one critical concern only three years ago, and has been steadily sliding down in the rankings.

6. Driver Retention — This problem has dropped from number three on last year’s list as a softer freight market in 2019 has lead to less truck driver turnover.

5. Truck Parking —  A long-term problem in the industry, this issue “creates a dangerous and costly dilemma for truck drivers who are often forced to drive beyond allowable Hours of Service rules or park in undesignated, and, in many cases, unsafe locations,” the ATRI says.

4. Detention/Delay at Customer Facilities — A brand-new addition to the ATRI’s top ten critical issues list, the ATRI references a study showing that driver detention of six or more hours has increased by over 27 percent between 2014 and 2018.

3. Driver Compensation — Another first-time-in-history addition, as driver pay has never been considered a top critical concern. This problem represents two sides to the complex issue–the carriers who must raise their driver pay, and drivers who are not satisfied with what they earn. Fleets have been increasing their drivers’ pay significantly, but many drivers still say their income is no longer keeping up with inflation, according to the ATRI. 

2. Hours of Service — HOS regulations have remained in the second spot of these rankings for the last two years. In 2019, the FMCSA has put into place an Advanced Notice of Proposed Rulemaking, which aims to provide greater flexibility in its rest break and split sleeper berth provision requirements. This regulation also extends duty time by two hours for drivers working in inclement weather, and lengthens the maximum on-duty driving period from 12 to 14 hours.

1. Driver Shortage — This issue has stayed at the top of ATRI’s rankings for three years in a row. Although many groups (like OOIDA) believe driver shortage is actually a driver retention and compensation issue, the ATRI explains that “despite a somewhat softer freight market in 2019 over 2018, demand for qualified drivers is still high and fleets are undertaking a number of approaches to mitigate the recruiting challenges.”

New Federal Rules Will Help Trucking Companies Hire Safe Drivers

November 6, 2019 by Levinson and Stefani Leave a Comment

The Federal government has adopted new policies aimed at taking unqualified truck drivers off the road. Registration is now open for the Drug and Alcohol Clearinghouse, a new substance abuse screening system for truckers that is scheduled to be operational early in 2020 . The Clearinghouse is a database that will keep track of drivers who have violated drug and alcohol policies in order to stop them from operating commercial vehicles. The Federal Motor Carrier Safety Administration anticipates that the implementation of this database will substantially reduce motor vehicle crashes involving heavy trucks. 

The federal rules regarding professional truck drivers already prohibit drivers from getting behind the wheel when they test positive for illegal drugs. Of course, everyone knows that drunk driving is illegal. The Clearinghouse database will allow trucking companies to screen drivers applying for jobs to see if they have previously tested positive for drugs and are looking to get hired at a new place. Drivers can also lookup their own information once they have registered with the Clearinghouse themselves. Once registered, drivers can search for their own information for free. The database will include information about whether a professional driver has any drug or alcohol program violations and, if applicable, the status of their petitions to return to duty. 

The new system is meant to act as a check on drivers who violate substance abuse rules follow the proper protocol to get back in to good standing, if possible, before they are allowed to keep driving. Drivers with commercial driver’s licenses, employers, law enforcement, medical review officers, and substance abuse processionals will be among the groups who will be authorized to access the Clearinghouse. 

As for what should be reported to the database – Federal Statutes cover that: 

Employers will report a driver’s drug and alcohol program violations. Medical review officers will do this as well. A driver does not need to register him or herself into the system for a medical review officer to enter a violation in the system. In fact, it is not mandatory for a driver to register. But, if an employer needs to conduct a full check on a driver, that driver will have to register. This means, drivers who don’t want to take part may not be able to get hired for certain jobs because perspective or current employers will not be able to conduct a full search on the database for their information. After January 6, 2019 a driver will have to be registered with the Clearinghouse in order for an employer to be able to conduct a full search on their record for new hires. Drivers who are registered will be able to give their consent to release drug and alcohol program information to employers. Also, when new information is added to their profile, drivers will receive notifications from the Clearinghouse in the mail or electronically. 

Drug abuse is a problem that needs to be addressed with treatment and counseling. Allowing drivers to keep working when they have a substance abuse problem by slipping through bureaucratic cracks doesn’t help drivers who may need help to get sober. It obviously makes roads less safe. 

In the computer age with so much information going digital, this just makes sense. Professional truck drivers have a difficult job. They have to work long hours, often by themselves, away from their families. They have to keep alert on the road and get enough rest to do so. Drug use is a problem that poses a great risk to the health and safety of, not only professional drivers, but also everyone else who shares the road with them. Safety is on the roads is imperative. This database is likely the least intrusive way to keep records of drug and alcohol program violations so that employers know if they are sending a driver out on the road with the proper credentials. 

Long Expected Woes of the Trucking Industry are Beginning to Appear

October 30, 2019 by Levinson and Stefani Leave a Comment

There is a lot to be said nowadays about the fate of the trucking industry. Not only has it become a recurring theme over the last decade for publications to seemingly write one article every few months highlighting the idea that the trucking industry would soon disappear, only to retract those words when the American Trucking Association (ATA) or another prominent figure in the industry would produce new statistics establishing just the opposite. It’s been a recurring theme for years, and even we have covered the “expectations” that industry representatives have set amid the continued “crisis” we are all hearing about. In May of 2019, we wrote about the ATA’s announcement that by 2026 there was an expectation that there would be a driver shortage of 175,000 drivers in the United States. Rightfully so, those in the industry panicked and in turn, it became once again widely publicized that arguably one of the most important industries in the United States would potentially be in a position it could never get out of.

When news broke in the beginner of October that 4,200 truck drivers had lost their jobs in September 2019, it proved something that many had long been arguing against; the idea that the trucking industry was resilient and had the ability to adapt to changing demographics. In fact, Trucking Info had the opportunity earlier this year to interview the Chief Economist for the ATA, Bob Costello, who stated “some trucking companies have put an emphasis on female drivers, but the highest percentage of female drivers we have seen is around 20% for those fleets,” speaking volumes to the weight the trucking industry is placing on diversifying its fleet in an attempt to keep pace with the ever changing dynamics of the US workforce. Further, we have also written about how companies are attempting to change their recruiting tactics to not only reach women, but reach younger drivers altogether to ensure that the shortage does not get out of hand. While these tactics are sure to help diversify and hopefully alleviate the potential shortage, what happens when the economy begins to suffer? How does the industry the respond to a driver shortage when fleets are being forced to layoff thousands of drivers each month?

A Bleak Outlook for the Industry May Be Getting Worse

There is a lot to be said nowadays about the fate of the trucking industry. Not only has it become a recurring theme over the last decade for publications to seemingly write one article every few months highlighting the idea that the trucking industry would soon disappear, only to retract those words when the American Trucking Association (ATA) or another prominent figure in the industry would produce new statistics establishing just the opposite. It’s been a recurring theme for years, and even we have covered the “expectations” that industry representatives have set amid the continued “crisis” we are all hearing about. In May of 2019, we wrote about the ATA’s announcement that by 2026 there was an expectation that there would be a driver shortage of 175,000 drivers in the United States. Rightfully so, those in the industry panicked and in turn, it became once again widely publicized that arguably one of the most important industries in the United States would potentially be in a position it could never get out of.

When news broke in the beginner of October that 4,200 truck drivers had lost their jobs in September 2019, it proved something that many had long been arguing against; the idea that the trucking industry was resilient and had the ability to adapt to changing demographics. In fact, Trucking Info had the opportunity earlier this year to interview the Chief Economist for the ATA, Bob Costello, who stated “some trucking companies have put an emphasis on female drivers, but the highest percentage of female drivers we have seen is around 20% for those fleets,” speaking volumes to the weight the trucking industry is placing on diversifying its fleet in an attempt to keep pace with the ever changing dynamics of the US workforce. Further, we have also written about how companies are attempting to change their recruiting tactics to not only reach women, but reach younger drivers altogether to ensure that the shortage does not get out of hand. While these tactics are sure to help diversify and hopefully alleviate the potential shortage, what happens when the economy begins to suffer? How does the industry the respond to a driver shortage when fleets are being forced to layoff thousands of drivers each month?

Safety Takes a Hit as the Industry Suffers

Our previous articles on this subject were in response to the growing age gap in the trucking industry and how the roads could be less safe as a result. For example, due to companies being unable to hire younger drivers, some turned to incentivizing older drivers who would push back retirement for more money or benefits. While these drivers provided much more experience and understanding of the roads, it could be argued that having fewer drivers who happened to be older also presented serious concerns about road safety, such as response time and vision concerns.

This argument becomes even stronger with the news that the industry is slashing jobs, meaning active recruitment for new drivers takes a backseat and the age demographic likely continues to be pushed back, becoming much older. Additionally, the current administration’s push to change the hours-of-service rules for truck drivers also presents issues with tired, overworked drivers, who may no longer be forced to stop for mandatory 30-minute rest breaks.

All these factors present serious risks to drivers on the road. In any industry, workers who are overworked, tired, and not forced to take breaks present disastrous results to production and safety. The trucking industry should be no different. News of the industry’s financial struggles just force the public to be aware of the potential ramifications that could occur on the road. Our lives could be put in danger due to the truck driver shortage and now, its very real financial shortcomings.

Trucking Industry Slowdown: Especially Difficult Quarter for Knight-Swift Transportation

October 24, 2019 by Levinson and Stefani Leave a Comment

Capacity has increased due to big rig orders hitting a record high last year, with both major and independent trucking companies upping capacity in correlation with higher rates. This was caused mostly by the trade war, which led to a change in regular shipping patterns.

Overcapacity has proven itself a huge cause in the current challenging freight industry of 2019.

David Jackson, CEO of the country’s largest trucking company, Knight-Swift Transportation, is predicting overcapacity to make for a highly difficult next quarter for the industry.

As Knight-Swift gears up to report its earnings for the third quarter of the year, Jackson says he is currently working with the company’s investors to prepare for instability.

“The freight environment is difficult,” he explains. “It has been more difficult than people expect from an earnings standpoint.”

Jackson says the trucking industry is about to hit his leading company’s bottom line, while he also expects truck and rail stocks to experience a similar negative impact.

Knight-Swift has lowered its earnings plan for the rest of 2019–previously, its earnings guidance was between 54 and 57 cents per share now, its forecast falls between 47 and 48 cents.

The trucking company is also expecting to make even less during its fourth quarter, lowering its prediction of earning between 73 and 77 cents per share to between 62 and 65 cents.

According to Jackson, overcapacity is the culprit. Capacity has increased due to big rig orders hitting a record high last year, with both major and independent trucking companies upping capacity in correlation with higher rates. This was caused mostly by the trade war, which led to a change in regular shipping patterns.

Additionally, while the trucking market is working to correct itself, employment rates given by the U.S. Department of Labor indicate a for-hire reduction of 4,200 trucking industry jobs last month–the third month in a row the industry has retracted open employment opportunities.

In August, the trucking industry dropped 5,100 jobs, on top of 300 back in July.

Jackson says these reductions aim to improve the carrier operating environment. “People in the industry and investors are looking for when that inflection point will come. [The] general consensus is, that is happening the second quarter of the year.”

Because capacity will most likely reduce after this challenging period, Jackson expects freight rates to return to stability during the first half of 2020.

Until this upswing, company earnings will continue to reflect the repercussions of overcapacity.

While Knight-Swifts’ overall business is comprised of 90% contract trucking, its revenue per truck declined 3% in the second quarter of 2019. The company’s brokerage revenues–where it uses the spot market to directly connect drivers and customers–decreased by 10%.

“There is going to continue to be near-term pressure on freight rates, but capacity is leaving the space and that is reducing the oversupply problem,” explained Jackson, whose comments come while the American Trucking Associations is also warning the industry of a continuation truck driver shortage.

The American Transportation Research Institute’s list of critical issues shows truck driver shortage leading the industry’s concerns for the third year in a row.

The list comes after the ATRI collects over 2,000 surveys from industry stakeholders, with 51% of responses from trucking companies and another 35% from professional commercial truck drivers.

However, there is a fierce debate regarding the validity of this issue. The ATA has been fighting against a study by the Bureau of Labor Statistics, which finds that the driver shortage is in fact a myth.

In the BLS study, findings show the labor shortage within long-haul trucking would potentially be solved with proper wages that meet truckers’ demands and working conditions.

The Owner Operator Independent Drivers Association (OOIDA) also believes the idea of driver shortage is a farce backed by major carriers refusing to admit to large industry problems–such as those surrounding driver retention and recruitment, poor working conditions, wages not keeping up with inflation, and unsatisfactory employee treatment.

The ATA currently estimates that there is a need for over 60,000 drivers, with a possible shortage of 100,000 drivers over the next five years.

The ATA also says it supports the ‘Drive-Safe Act’ legislation, otherwise known as the Developing Responsible Individuals for a Vibrant Economy Act, which works to allow 18-year-old drivers to have a CDL and contract as regular employees in the industry.

Critics say the driver shortage myth aims to win lawmakers’ support in legislation such as this, which they say will not remedy the industry’s chronically excessive driver turnover rate.

American Trucking Association Targets “Nuclear” Verdicts

October 21, 2019 by Levinson and Stefani Leave a Comment

American Trucking Associations President Chris Spear is planning to lead the organization in fighting large court verdicts against the trucking industry. He claims the association is always quick to compensate those involved in cases in which the ATA is at fault, but that most cases are not being settled fairly.

“We’re growing very tired as an industry of being picked on by the plaintiff’s bar,” Spear said. “I think we’re growing very tired of padding the pockets of trial lawyers at the expense of trucking jobs, and we’re just not going to stand for it anymore.” Spear claims these verdicts are an “all-out assault” against the trucking industry, and therefore, ATA should be positioning itself to fight back.

Spear told Transport Topics Radio that he believes the number of lawsuits against the trucking industry is increasing as attorneys who specialize in these kinds of lawsuits are amping up their advertising. These are what he calls “nuclear” lawsuits.

He claims these “massive” suits come against the trucking industry regarding incidents that “are clearly not [its] fault,” and that trial lawyers in these particular suits are working a false narrative that the industry is “devastating the fabric of families involved in these accidents,” which he claims are usually not at the hands of truckers. 

However, as any individual who has learned of any trucking-involved accident knows, this is clearly not the case.

We recently wrote about a historic “underride accident” case that comes after a slew of these accident reports over the past few years. Underride accidents take place when a car slides underneath a tractor trailer, and is one of the deadliest types of accidents on U.S. roadways.

The particular case referenced occurred when a family was awarded $42 million in a lawsuit against trucking company Barkandhi Express and Utility, when 16-year-old Riley Hein’s car became trapped under the side of a trailer made by Utility Manufacturing Company, causing the truck to drag Riley’s car for a half mile until it caught on fire, killing Riley immediately.

Trailers are not currently required to have side guards, even though the trucking industry has admitted in trial that over 200 people a year die in underride accidents.

The Truck Trailer Manufacturers Association says adding the weight of new guards to trailers would require companies to add more tractor trailers onto the roads, which it says would be more of an inconvenience than a safety benefit.

What is worse–documents revealed in Riley’s case show the TTMA asking major trailer manufacturers to provide detailed information regarding side guard costs so that the association could be able to potentially develop defense strategies against future underride lawsuits.

Still, Chris Spear and the American Trucking Associations have been handpicking cases to highlight only what they hope will gain public traction in opposition of lawsuits against the trucking industry.

Spear brought up a particular case in his Transport Topics interview, which occurred in 2014 and involved a pickup truck crossing a median and colliding with a tractor-trailer on a Texas interstate. The family of the pickup driver argued in court that the trucker should have pulled over due to inclement weather conditions, and the jury awarded them close to $90 million. The carrier, Werner Enterprises, is still working to appeal this decision.

“We’re paying substantial money to make [verdicts like these] right, and this [legal] profession needs to be called out,” says Spear.

However, Spear isn’t giving all of the facts of the case. According to court documents, evidence shows Werner had been staying quiet in regards to its disregard for safety policies around new student drivers. Each year, Werner hires 4,000 new drivers without previous truck driving experience. The driver in this case was a student driver, who exceeded 60 mph in icy conditions. The National Weather Service had been reporting freezing rain and icy roads 12 hours before the collision, yet Werner never communicated this warning to its driver.

“Werner’s lack of basic safety systems and its inadequate training processes for students drivers–combined with the business model of assigning student drivers on expedited deliveries–is creating a highly dangerous and unsustainable dynamic on U.S. Highways,” said the family’s co-lead counsel, Eric Penn of the Penn Law Firm.

What Spear also fails to mention is that the jury had heard the extent of the evidence and made what they believed to be a fair verdict. Of course, juries can make an incorrect judgment, but even when they do make a verdict against the trucking industry, tort reform comes into play.

Tort reform limits the recoveries awarded to those harmed by trucking industry dangers. This turns out to be nonsensical, as no two cases are the same and should always be judged on their own merits, not by limits on recovery.

The American Trucking Associations feels differently. Spear says verdicts like the one in the pickup truck case have made him decide to pledge to actively work with government leaders on tort reform efforts, even though he knows the overall view on the topic may not be in his favor.

“On the federal level, the votes may not be there for federal tort reform. In fact, I know that.”

If these limits weren’t enough, we have the trucking industry going to extreme lengths to avoid admitting fault in accidents. Not only is Utility Trailer Manufacturing Company working to appeal the $19 million it had to pay for its part in the verdict of Riley’s case, but it offered the Hein family a $14 million settlement if they kept all internal documents quiet.

In another case against Werner, court documents showed the trucking company staying quiet about its disregard for safety policies in regards to new student drivers–Werner hires 4,000 new drivers a year without any previous truck driving experience.

What Spear also doesn’t mention is the fact that trucking companies and their insurers hire as expensive and prestigious law firms for their cases as possible–so, not only are jurors always making decisions based on information from both sides, but these law firms are powerful and know how to swing a case in their favor–whether or not their techniques are ethical.

If verdicts like the ones Spear mentions are so unfair, what does that say about the trucking industry’s position and their lawyers’ abilities to make a compelling argument? 

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