Electronic Logging Devices: Are You Prepared?
Technology continues to shape the way the supply chain evolves and transportation is no exception to this trend. In February 2016, the Federal Motor Carrier Safety Administration (FMCSA) announced the implementation of mandatory electronic logging devices (ELDs) to track a driver’s hours of service (HOS). Hours of service provide mandates for a driver’s time on the road and help to keep the driver and those on the road safe. According to a truckstop.com survey in March 2016, 84 percent of trucking companies do not have onboard computers or ELDs and nearly as many do not plan to add them until shortly before the required deadlines1. The trend continues for implementation across North America with the Canadian Council of Motor Transport Administrators anticipated to place a similar mandate soon2. It is key for shippers, whether they operate a private fleet or work with carriers, to understand the complex requirements, to begin preparing, and to partner with a 3PL to keep their products moving during this transition.
Who, What, and When?
The ELD mandate has three phases. The initial phase, awareness and announcement of ELDs, began on February 16, 20163. FMCSA advised all carriers to prepare by choosing an ELD program and begin to voluntarily use the technology. For carriers currently operating with paper logs or logging software, this is the time to choose a program2.
Phase two begins December 18, 2017 and goes until December 16, 20193. At this time, FMCSA will begin phased-in compliance. From now until December 2017, carriers will need to implement automatic on-board recording devices (AOBRDs) or ELDs. If a carrier chooses to implement AOBRDS, it will be considered compliant until December 16, 2019.
By December 16, 2019, all carriers and drivers a shipper works with will be required full compliance, utilizing a registered and certified ELD3. According to FMCSA reports, ELDs save time for a driver and reduces paperwork, while reducing the hassle and possible inaccuracies of keeping paper logs. Fines for hours of service logging are estimated to be more than $65 million already in 2017. ELDs are expected to provide paperwork savings of over $1.6 billion annually, plus crash reduction costs of $395 million1.
Despite the potential future savings, ELDs can present a significant investment for shippers that operate private fleets in the next few years, not just in purchasing cost but in the training needed for drivers, supervisors, and administrators. For shippers whose carriers do not comply may also at risk at loss productivity and missing potential sales.
It is important that shippers and carriers begin preparing now during the awareness phase. First, have a plan and make a decision4. Research options and find an ELD that best fits the desired budget and needs. Waiting until the last minute can result in non-compliance and additional unwanted costs.
In the plan, decide if first utilizing an AOBRD in the interim best fits or going directly to ELDs is a better choice4. AOBRDs need to be in place prior to December 17, 2017 to be grandfathered in, granting another two years before the ELD requirement. This will buy time, but in the end, an ELD will still need to be implemented by 2019.
Preparing drivers, supervisors, and administration with training prior to the implementation date is crucial for success4. Drivers need to understand and operate the device with ease on the road. Having a comprehensive knowledge can make roadside inspections by law enforcement seamless. Supervisors and administration should also understand the device for documenting hours of service.
The ELD mandate may come with many positive cost savings and efficiencies moving forward, but implementation and training can be daunting and costly. For shippers utilizing outside carriers, work with the providers to ensure compliance. Partnering with a 3PL with dedicated fleet solutions can relieve a shipper of the pressures related to ELD implementation. A supply chain solutions provider can provide peace-of-mind ensuring its dedicated fleet is safe, compliant, and continuously delivering.