Volume 39, Issue 2, February  2004


A Long, Strange Trip
The Fed’s New 
Regulations and Their 
Effect on the Industry

by Denise Breard

The federal government enacted rules to regulate how long a driver could operate a commercial motor vehicle in order to prevent accidents more than 60 years ago. Since the late 1970s, this working time, commonly referred to as hours of service (HOS), has been under close scrutiny and research with significant modifications. It has taken more than 20 years of discussions and delays, but the rules have finally changed. According to one article from Transportation Topics, a proposed hours-of-service plan in May 2000 “drew such widespread criticism that Congress prohibited the Federal Motor Carrier Safety Administration (FMCSA) from implementing it.” FMCSA considered more than 50,000 comments when the final rule was drafted. 

On January 4, 2004, the new regulation became effective. Although there are modifications from the last proposal, many members of the glass industry are not pleased with the new regulations. The new regulation states drivers are allowed the following:

• To drive up to 11 consecutive hour (a one-hour increase); they are required to rest for ten consecutive hours; and

• The total time drivers can work in a day (or on-duty hours) will decrease from 15 to 14, or 11 hours of driving time and three hours of on-duty, non-driving for loading, waiting or other activities before the mandatory ten-hour rest. 

The inclusion of on-duty, non-driving in a driver’s total work time is a major issue for many companies. The change makes adherence to schedules even more critical, as delays could become costly.

Some of the previous limits, 60 hours per week or 70 hours in eight days, will remain unchanged. Drivers also can restart their week at any point if they are off-duty for 34 consecutive hours. According to the FMCSA, the new rules “will save as many as 75 lives and prevent up to 1,326 fatigue-related accidents involving trucks each year.” The agency also said that the trucking industry would need to hire more than 84,000 drivers in order to comply; by the same token, the new regulation is expected to save the trucking industry $611 million. 

Effect On The Glass Industry
Analyzing the implications of the new rule, John Kannawarf, corporate manager-transportation for Atlanta-based AFGD, said that at first glance it appears the typical driver is losing only one hour of allowable work time per day. However, he says the loss is much greater because the formula to compute on-duty hours has been changed. Under the old rule a driver could log off duty for rest breaks, meals and non-productive time, making it possible to extend the 15-hour workday. Under the new rule, the allowable 14 hours are continuous.

And not all drivers are affected the same. Kannawarf said drivers with short delivery routes and routes with few stops should not be impacted by the change. But those with long routes and those with multiple stops will be affected most significantly.

“We’ve been analyzing and reconfiguring delivery routes in anticipation of the rule changes, but we have not yet felt the full impact of the change; it is still too early,” said Kannawarf. “Our facilities are expediting the unloading process by spreading out appointments to avoid a back-up. We must unload quickly and turn around specialized glass-hauling trailers, already in short supply,” he added.

John Stilwell, president of AFGD, also sees the new HOS affecting business. 

“We have more than 300 trucks on the road, providing next-day and standard service with hundreds of unique routes,” Stilwell said. “This is a rule that limits the number of hours a driver can work. [In 2002, AFGD’s fleet logged more than 12 million miles]. As a result, trucking industry experts are projecting a 2-percent to 19-percent loss in productivity. These restrictive rule changes ultimately will mean higher trucking costs since more trucks and experienced drivers will be needed to supply glass to our customers.” 

For J.E. Berkowitz of Westville, N.J., the new rules have enormous implications. According to Ned Nudelman, fleet manager, the fact that there is no universal percentage for calculating the loss in productivity is an issue. 

“We must persuade our customers to help us increase productivity or educate them on their inefficiencies,” he said, adding that close coordination between staff and customers is essential.

For example, Nudelman said the need for accurate directions to a delivery site is important. Because most job sites are new construction and streets have not been labeled, they are not on maps, he explained. Customers rely heavily on maps from the Internet, but that poses some serious drawbacks. 

“Most of these directions are for cars, not heavy trucks. [Because of that] a truck could travel several miles in the wrong direction. That takes time away from the driver’s productivity.” 

Nudelman said his company has GPS tracking so the customer service department can track drivers through their trips, which can save both time and paperwork. 

“With this current technology we have improved out-bound deliveries considerably. Our in-bound shipments from suppliers were presently running at 65 percent. Since the new regulation went into effect, we’ve had bad weather, which affects deliveries, so at this point it has been difficult to measure the impact of the change,” said Nudelman, adding that the key issue is the inclusion of loading and un-loading as on-duty time. “We can’t afford to have our drivers waiting at the loading docks or at jobsites. We are keeping careful records and informing our customers that we must adhere to schedules because delays could become costly.”

Jim Charles, director of marketing and sales for Vitro America, said his company will be affected by the new regulation in many ways due to a unique, but complex trucking situation. 

“We have DOT-regulated trucks that are used primarily for delivery of our distribution products. At the same distribution facilities, we receive deliveries from primary glass manufacturers and from our parent company in Mexico,” Charles said. “At our mirror plant we have a fleet of DOT-regulated trucks; we use outside carriers for delivery of laminated and mirror products.” Charles agreed that one of the biggest effects of the new regulation will be having to hire more drivers. 

“We believe this additional cost will be passed on to us, either by a higher rate or a surcharge, the latter being the more common,” he said.

However, Charles said there is another important change to recognize: the need for everyone—truckers, manufacturers, distributors—to operate more efficiently at loading, unloading and scheduling. 

“Appointments for deliveries will be a must. Arriving on time will be critical. And unloading in a timely manner will be necessary to minimize penalties,” said Charles. 

He said an important part of controlling costs will be accurate record-keeping. 

“We intend to offer our customers a log book. We must note the time the truck is ready to unload and the time unloading is completed and the driver should initial both of these to avoid penalties.” 

He added, though, that it will take time for all of those involved to determine how best to approach this situation individually. 

Opportunities 
Time will tell to what extent the glass industry will be affected by the regulations. Stilwell, however, is optimistic.

“There have been many challenges in the glass business the past couple of years, which have forced us to become a better company,” he said. “The new driver HOS rules offer us another opportunity to improve our operations.” 


USG

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