If the FMCSA continues to utilize its pattern of aggression, it will drive many small carriers out of business
Phoenix, AZ (PRWEB) August 21, 2014
Andy Ahern, Founder and CEO of leading trucking logistics company Ahern & Associates, has announced a call to action for carriers in the industry to review and revise as needed their business plans as Hours of Service rules for drivers turn up the heat in an industry already in a pressure cooker.
The Hours of Service (HOS) rules were revised on July 2, 2013 and since then, there has been a declining availability of drivers. According to the statistics from the American Trucking Association, in 2012 the industry was short about 113,000 drivers per year. Now with the revision of HOS, that number is expected to reach 323,000 within the next 12 months.
The HOS rules limit the number of hours that commercial drivers can be on a job, resulting in a drop in productivity; under the new rules, drivers must take a minimum 30-minute break during the first 8 hours of a shift. In addition, the maximum average work week is capped at 70, down from the previous 82 hours. Put simply, a driver will now make less money in a stressful and difficult environment.
“While the driver pool is aging and new drivers are not entering fast enough to satisfy demand, the Hours of Service ruling impacts the industry too because smaller carriers cannot continue to compete with all of the technology, EPA requirements, and CSA rulings and expect to survive,” explains Ahern.
In light of these changes and the forthcoming effects on the industry, Andy Ahern is advising all carriers to review each customer’s rates, lane and fuel surcharges, maximize utilization of each truck to the best of their abilities, monitor how quickly customers pay them, and in general raise rates to the level they need to be at. The cost of fuel is increasing, the cost of equipment and to implement e-logs is increasing, and the cost of technology means that the shipper and the general public are going to have to pay for this type of technology.
Andy Ahern further explains, “If the FMCSA continues to utilize its pattern of aggression, it will drive many small carriers out of business. There have already been 10,000 additional trucks taken out of system the first quarter of 2014. What I don’t think the legislatures understand, nor does the general public understand, is that with the new HOS rules, coupled with the chronic driver shortage and a weak economy, small carriers will not survive, which means that impacts the economy and ultimately, the consumer’s pocketbook.”
About Ahern & Associates, Ltd.
Ahern and Associates is North America’s leading trucking and transportation management consulting firm. The skilled consultants at Ahern and Associates specialize in mergers and acquisitions of trucking and logistics companies as well as the restructuring and evaluation of existing carriers that seek to increase operating efficiency and improve profitability. Since 1987, Ahern and Associates has aided hundreds of buyers in the acquisition of trucking and logistics companies throughout the U.S. and Canada as well as assisting many transportation and logistics companies in reducing their overall operating costs and increasing their profitability.
For more information, please call 602-242-1030 or visit http://www.ahern-ltd.com.