Overdrive Extra

Max Heine

2014: Prosperity, regulatory chokehold and driver demand

| January 02, 2014

2014 promises to be a good year for owner-operators. Good, at least, if you don’t mind an increasingly restrictive regulatory environment.

The overall economy was strong enough for the Federal Reserve to ease its stimulus measures in mid-December. Earlier in the month, unemployment fell to its lowest rate in five years. The stock market on Tuesday concluded its best year since 1997.

Trucking, too, has some things going for it. Half of fleet executives polled in November by Commercial Carrier Journal, Overdrive’s sister publication, expected business conditions to be “better” or “much better” in the next six months. Only 3.1 percent said conditions would worsen.        

For owner-operators, notes Todd Amen, head of financial services provider ATBS, there are some clear pluses:

  • One is “significant money coming back into the market to finance owner-operators.” If you’re among those who have been hamstrung since the recession with marginal credit and a truck in need of trading, this should be good news.
  • Lower fuel prices. A chart on page 20 shows how cheaper diesel in mid-2013 helped boost owner-operator income.
  • Finally, there is “a good demand balance between freight and trucks,” notes Amen. Dry van freight volumes were static or falling each year since the recession ended, says Bob Costello, economist for the American Trucking Associations, but by the second half of 2013, they were showing “solid year-over-year and quarter-over-quarter gains. … The acceleration of dry van freight gives me the idea that things are going to be better in 2014 than they were in 2013.” Internet Truckstop data shows dry van and reefer rates spiked in November.

As for what’s not going right, possibly the biggest hindrance to running as an owner-operator in 2014 isn’t callous fleets, ignorant inspectors or brain-dead four-wheelers. It’s the ever-tightening headlock of regulation.

Economist Eric Starks says 2014 will contain the largest concentration of regulatory changes in trucking’s history. The initiatives are too numerous to detail here, but among them are California Air Resources Board emissions rules, hours of service, greenhouse gas/mpg regulations and requirements for electronic logging devices and speed limiters.

“The problem is not so much the regulations themselves,” said Starks, president of FTR Associates, addressing the Commercial Carrier Journal 2013 Fall Symposium in Scottsdale, Ariz. “It’s the fact that they’re all happening at once. But make no mistake – these regulations will be game-changers.”

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Such roadblocks can filter out operators who simply can’t — or don’t want to — comply. “Between increasing demand for freight services and regulatory pressures,” says Costello, “I expect fleets to remain challenged finding enough qualified drivers, and we’ll be contending with driver shortage-related issues for the foreseeable future.”

Will that driver demand be strong enough to run up rates significantly? Hard to say, but if you can stay compliant and hang in there, you’ll find out.

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  • lastgoodusername

    supply and demand. the only way rates will go up is by less trucks to pick up said freight. There is no driver shortage , there is a truck overage. Just because the mega fleets have trucks sitting around does not constitute a driver shortage when compared to available freight.

  • Tom T

    I`ve seen this movie before and it never seems to end well for the small operator or even drivers for that matter. Too many if`s here. For sure there is not a driver shortage, just a shortage of well paying jobs. Turn over rate is at an all time high, and they know well the reasons why. They have known since the early eighties and will still squeeze every mile, every hour of uncompensated delay time, and every benefit they can get away without paying for, while blaming the driver for every late delivery, every accident every refused load due to log requirements and demand he keep all the blame for out of service violations on their equipment to keep their ratings up. Truck shortages will occur and large companies will flood the market again as they did before when it happened and drive the rates back down, and no one has even mentioned what Obama care might do to those who still provide bare minimum health ins. EPA regulations, as mentioned above will, I believe have a major impact on equipment manufacturers and costs not to mention maintenance costs. Speed limiters have already happened in Canada and when it hits here, the large companies will have achieved the dominance in the market place they have been lobbying so diligently for. Call me a pessimists or someone who`s been around for along, long time and lived through it all before, but I am not optimistic about this industry from anyone’s point of view but an investor who has it to lose or someone who doesn’t know any better.

  • Mind Games

    We elect em we throw em out and especially the two party system which is just a never ending head game that only fools enjoy playing and I am no one’s fool! Question is are you Mr. Truck Driver??? Which clever fool or should I say clever party did YOU vote for and are ya proud of what you did TO your country???

  • texasjayhawker

    The Hour of Service are going to be the big hit. The ultiment 5th Amendment, unconstitutional act of “self-incriminataion”. Seems some can “take the fifth” and for others, they have no rights. Go figure.

  • Ron

    When the speed limiters become mandatory is when I walk away. That will be the final straw for me.

  • Ron

    I have enough other skills/education that I don’t have to put up with the DoT’s bullshit regulations. I do it because I like to, not because I have to

  • MercenaryMan

    If the new Trans Pacific Partnership goes thru and most of the remaining manufacturing moves to Vietnam, or some other less then third world country, what will happen in America, to is jobs, its Drivers and O/O fleets…theyll get murdered, well allow immigration reform that gives the advantage, or your job TO that Immigran who will LIVE in the truck, work for less and be rich because in his country they earned 25 CENTS a day, now they live in a truck stop, with a toilet….showers, and FF,,,Its going to be interesting to see what happens to America, sold down the river again by another Free Trade Agreement that our Legislators cant even debate or ask for changes to, its being Fast Tracked without debate, without change and soon, when its announced this trade deal made in secret allows for Labor agreements to be abandoned and Union Contracts to be tossed, because there will suddenly be no legal recourse as the new Trans Pacific Partnership takes your rights and allows multinationals to set the wage, the Pay, the contract language and you dont get to vote or decide…..

  • William McKelvie

    QUOTE: The problem is not so much the regulations themselves,” said Starks, president of FTR Associates, addressing the Commercial Carrier Journal 2013 Fall Symposium in Scottsdale, Ariz.
    I wonder when the last time he sat in the drivers seat? SMH!!!

  • guest

    Why continue to Comply? With more and more hoops to jump thru..at the whim of buruacrats?? Whats next?? A camera in your face?? A Mask in your sleeper already….RATES will never improve enuff to Drive with Harnesses around out necks??

    The point of Diminishing reward for out EFFORTS was reached long ago…..only Obediant Chumps will remain for MORE punishment and surveilance…face it…trucking is a LOSER.

  • g

    No Doubt…..we have Prison On Wheels today….with Young Cops in our face and poking around our trucks constantly…yep it IS a PROBLEM.

  • g

    May as well start planning for that day…it is coming.

  • g

    Yep trucking is getting worse every day. No good ending for this Movie.

  • guest

    OBEY! COMPLY!! CONFORM!! what a sick joke trucking is.

  • gator

    lets all get sick on one day and let it last for 3-4 days there is nothing they can do about it it will be to late by the time it gets found out

  • gator

    you know all the idias and demands are out there we wont need to say anything when we all get sick and if you have to there are other ways to stop that truck for 3-4 days with out DR notes but if you need a DR notes use OB care i mean come on lets GROW SOME if the MEXICANS can DO IT AND #RD WORID CUNTRYS FIGHT FOR THINGS THAT ARE WORTH LESS THAN WHAT WE WANT!!!!!! OR AM I JUST SAYING NONSENCE I MEAN WE ARE ALL BITCHING ABOUT ONE THING OR ANOTHER I THINK WE CAN ALL JUST AT LEAST AGREE TO DISSAGREE AND DO SOMETHING INSETED OF BITCHING AND TAKE IT UP THE ASS AGAIN AND AGAIN WHAT ARE THEY GOING TO PUT US IN JAIL NO NO NO THE WORST THAT WILL HAPPEN IS YOU LOOSE YOUR JOB YA BIG DEAL RIGHT NOT LIKE ITS NOT GOING TO HAPPEN SOONER OR LATER ITS GOING TO BE SOONER YOU NO IT AND IF YOU O/O ITS ALL READY DONE AS OF 4 DAYS AGO AND YOU KNOW IT

  • gator

    please if anyone has a better idia lets by all means do it or stop bitching and let SWIFT US EX SHNIDE EX EX EX EX FINISH US OF NOW INSTED OF PROLONGING IT AND GET COUGHT AND PAYING FINES TO CA AND OTHER STATES BECOUSE THATS WHATS GOING TO HAPPEN AND YOU KNOW IT AND DO YOU REALLY WANT ALL THESE NEW KIDS AND OTHER BAD ONES TAKEING WHAT WEV TRYED TO BULID I MEANE THESE NEW ONES AND OTHERS YOU KNOW WITCH ONES IM TALKING ABOUT THEY RACE ONE TRUCK STOP TO ONOTHER AND CANT DRIVE IN BAD WEATHER DONT HAVE MANERS FOR THE CUSTUMER AND THE ELDERS OR THE ROAD BUT THATS OK BECOUSE WERE GETTING ALOT DONE BY BLOGING AND BITCHING ON THE CB YA ITS WORKING WELL I MIGHT ADD WERE LOOSING AND ITS ALL AND I MEAN ALL OF OUR FALTS SO LETS MAKE SOME CHANGE YOU KNOW LIKE THE GREAT AND POWERFUL DUMASS I MEAN OBOMMMMMA HE SAID AND THATS ALL HE DI WAS SAY I GOING TO MAKE CHANGE FOR THE GOOD AND LOOK NOW

  • Semper Fi

    The American cry baby or “tuck driver” as you call it; has no idea what a bad day really is. Younger Americans are soft, lazy and have very little knowledge of what work is. There is no way todays society could go through what the greatest generation did. They are to self-centered, just as most of you are here. STOP bitching. Don’t drive for a big company, buy your own truck, do it your way. Cant afford it? Why not. I started with less than nothing and in three years my truck and trailer are paid for. I operate under my own authority and have never made this much money in my life. My CSA score is still “0″, and I rarely get called in using pre-pass. Do I cheat on my log books? once in a while yes.. do I get stopped at shippers/receivers? yes, on average once or twice a week. But I’m making over six figures after expenses and will be able to retire in just three more years. I spent my younger years in the Marine Corps, have been shot twice and had to give orders that cost men their lives; and you babies bitch about regulations. Stand up, grow a pair or just crawl back into your Obama paid for hole in the ground.

  • hacksaw

    after deregulation this looks like re regulation to me. A lot of old company’s (Humping Hanna among others ) and I heard a lot of O/O say I will not haul for less than a dollor a mile. The way I see it it is going to be a real flush of the O/O’s That have a lot of expences riding on the income from there truck. I don’t think the rates will improve to the point to allow the purchase of new equipment and the cost of operation

  • Voodoolou

    I don’t think there is a driver shortage. There is a shortage of experianced drivers. Anyone can hold a steering wheel, but it takes years of experiance, knowledge, and good common sense to do this job right. So many new drivers think it’s all about themselves and money. Forget about everyone else, its justa bout me. I see it new driver and foreign drivers, they come into a shipper/consignee and think “hey you gotta load me first because it’s me” yes hours of service hurts us, as do regulations that don’t make sense. FMCSA bends to the public fear. Someone doesn’t like big trucks, so they start a protest group, file a law suit and suddenly FMCSA is kissing their back side. Its only fair if it benefits someone else

  • gator

    this country is the poster child of a third world cuntry this is how it all started it will end the same as all of the others bank it

  • guest

    Who would want to INVEST MONEY in this Over Regulated, Moniotored B.S. where cops are IN YOUR FACE and In Your POCKET every day?? Like your are in a PRISON??? Only a Chump would…..

  • g

    I think his entire comment is BOGUS. He is a cheerleader..probably works for ATA.

  • g

    This commenter is probably a COP..and wants everyone to join trucking so he can Rip them Off

  • Gabriel Soto

    Drivers,

    Lets all just take a look ? I mean really take a look at what’s happening to us. There is a whole new world of trucking out there, WE SAW IT COMING IN THE 80′s we did nothing about it WHY WHY !!!! We may not have been able to stop all the changes but we could have made them aware of who we are and what we can do IF WE WOULD HAVE STAYED UNITED AS TRCK DRIVER. OWNER OPPERATOR, HELL JUST OVERALL HARD WORKING WELL TRAINED EXSPERANCED TRUCKERS.

    Instead we gave birth to a hole new breed of truckers… YES LAZY,Disrespectful, Poorly trained. want to be truck drivers. you can tell who they are right away at the same time you can tell who’s the real drivers.

    There is still a lot of good truck drivers out there you know.

    The ones who came from the SCHOOL OF HARD KNOTS.

    They know what it took for them to earn there tread. It wasn’t just given them in three mouths of training ( AKA truck driving school) along with a big shinny truck and a Title ( PERFECIONAL TRUCK DRIVER !!

    WTF HAPPEN .. They took everything that my Dad and your Dad and Mom worked so hard for they took the reason we were able to call our self’s AMERICAS TRUCK DRIVERS the REALTRUCKERS.

    True professional when you come across them you see small but meaningful acts like this….

    Moving over giving you room when your on the shoulder, ask if your ok on the side of the road,

    Give that 4 wheeler that’s getting ready to get on the on the big road some room never know that could be your family member,

    Move forward after I pump my fuel,

    Turn my head lights off and on at night when you pas my big truck to come on over its safe, (NOT HIGH BEEMs)

    Flash you with a respectful thank you driver,

    When driving thru the truck stop parking lot using right speeds not high way speed,

    Give you room let you back in that hole (not try to back in at the same time,

    These are only small things but you know what I’m talking about…You were taught the same way I was.

    GOD BLESS AMERICAN TRUCK DRIVER..

  • guest

    Soon the new LAW will be drivers must wear UNIFORMS and have spit shine shoes?? Had enuff yet??

  • ironage

    I would recommend ” School House Rock”

  • david webster

    Many truck drivers are working at other jobs in Canada that pay at $18 to $25. per hour. We have trucks have been siting as the rates are too low to pay drivers at $21 per hour plus overtime

  • david webster

    Ir would better to pit min . rates and overtime than this as in farming you have to work when is not raining. Both in farming and in the propane shortage overtime is better than excess log regulations.

  • david webster

    I own 5 trucks and in the past 6 years would have been better to have parked them in the fence corner I have been very careful on the loads i took have my own shop on the farm. My son and all the other drivers have got other jobs .2 work for the city of Toronto one works for Huron county as a Snow plow operator, one drives ambulance 2 others went Alberta and do oil rig maint., these trucks and trailers are in good shape