Accentuate The Positive

| December 12, 2008

Despite uncertainty over the impact of the new hours-of-service rule, which went into effect Jan. 4, the new year has started on a fairly upbeat note:

FREIGHT IS STRONG – AND GETTING STRONGER. The American Trucking Associations’ Truck Tonnage Index finished 2003 up 3 percent. That trend appears to be continuing into 2004. For example, leading carriers report that freight didn’t fall off as much as usual this winter. And if the National Association of Manufacturers’ predictions come true, manufacturing output will increase by 6.1 percent this year.

ACCESSORIAL CHARGES AND PAY ARE ON THE RISE. To compensate for productivity lost to the new hours rule, many carriers are raising owner-operator base pay and offering higher payments for detention time, unloading and stop-offs. For example, Navajo Shippers, an Oklahoma-based refrigerated carrier, instituted new charges to compensate for less truck utilization, says Vice President Don Digby Jr. “Ninety-five percent of our customer base has agreed to it because truckers can no longer run as many miles,” Digby says.

AND FINALLY, THE SKY HASN’T FALLEN – YET. Not since the Y2K bug has there been an event so anticipated by gloom and doom predictions, yet the new hours rule went into effect with little or no fanfare. This is due in part to the Federal Motor Carrier Safety Administration easing the industry into compliance by encouraging law enforcement to implement a 60-day education period. This will give carriers and owner-operators some breathing room as they determine exactly how the new rule will impact their businesses.

Although challenges remain, let’s hope the momentum gained from a positive start will carry us throughout the year.

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