Truckload carriers speculate on the future

Werner, Knight, and Prime look at industry for TCA panelCurrent strong economic conditions offer "opportunities for all sizes of carriers," but only those with "the most cost-effective assets will win," according to Kevin Knight, CEO of Knight Transportation.Speaking on a panel of fleet executives at the 1998 annual meeting of the Truckload Carriers Assn., Knight pointed out that assets for a trucking

Werner, Knight, and Prime look at industry for TCA panel

Current strong economic conditions offer "opportunities for all sizes of carriers," but only those with "the most cost-effective assets will win," according to Kevin Knight, CEO of Knight Transportation.

Speaking on a panel of fleet executives at the 1998 annual meeting of the Truckload Carriers Assn., Knight pointed out that assets for a trucking fleet include "trucks, people, and systems." He also warned that he foresees "more (truckload carrier) consolidation ahead based on balance sheet strengths."

Agreeing with Knight, Robert Low, the president and CEO of Prime Inc., said that the truckload business "looks good for the near term on both a miles and dollars-per-truck basis." The key to continued success, he added, will be continued improvements in productivity. Prime, he said, is looking to optimization software that analyzes load profitability to provide at least part of that productivity increase.

The third member of the panel, Werner Enterprises chairman Clarence L. Werner, said, "Our highway (to future success) will be paved with technology." The 40-year-old fleet "has spent and will continue spending a lot on developing our own integrated technology systems," he said, pointing out that Werner will grow "not by adding trucks, but by being more efficient."

On the issue of driver retention, both Knight and Low said shippers need to become part of the solution. "We need to convince receivers especially that drivers' time is better spent driving, not unloading freight," Low told TCA members.

The need to get drivers home more often will also continue to push truckload carriers away from traditional irregular longhaul routes into more regional operations, according to Werner and Knight. Taking a somewhat different approach, Low said that Prime has one division that keeps drivers out for long periods. "We've found that it can be a powerful network, and very productive," he said, "as long as a driver is willing to do it."

As for consolidation among truckload carriers, Werner said that "acquisitions are being fueled" by the stock markets, which currently look for annual growth rates of 15 to 20% in publicly traded carriers. Such growth pressure can have "a negative effect" on the industry, Low added, because "carriers have to price very aggressively to get that kind of growth." At Prime, which is privately held, "we believe that profit is more important than growth."

The panel, entitled "Seeing Beyond the Horizon," was moderated by Martin Carver, chairman of Bandag Inc.

A new short-range pager alerts drivers when their INTOUCH mobile communications system receives a message. Introduced at the TCA annual meeting, the optional INTOUCH Message Alert looks like an ordinary pager and has an operating range of half a mile from a truck equipped with the PeopleNet two-way communications system.

The special pager will allow drivers to leave their vehicles for rest, food, or other reasons and still be readily available to dispatchers and fleet managers, according to a spokesperson for PeopleNet.

The INTOUCH system provides vehicle tracking and two-way data communications over a national cellular network.

Truckload carrier PST Vans Inc. has finalized a five-year agreement to outsource its information systems and services. Under the contract, the SABRE Group will manage PST's data center and network, providing maintenance, new software tools, and daily operations support. Among the upgrades will be a number of SABRE's optimization and decision-support tools.

The newest version of Comdata's information management software will now allow fleets to have instant access to fuel and payroll transactions, diesel fuel prices, and industry news through the Internet. Previous versions of MOTRS required direct dial-up access. Comdata also announced that it has formed a partnership with IBM Global Services to provide customers with a wide variety of Internet services.

O&S Trucking and D.M. Bowman were named grand prize winners in TCA's 1997 National Fleet Safety Contest. O&S was the winner among truckload fleets operating less than 25-million miles annually, while Bowan won in the over 25-million-mile group. Sponsored by Trailmobile Inc., the contest judged fleets on accident frequency, safety program organization, driver selection procedures, training, maintenance, and other safety-related factors.

The Truckload Carriers Assn. honored four drivers at its annual meeting as the best in the industry. Winners of the Ninth Annual Company Equipment Driver of the Year award were Gilbert Clinard of Merit Distribution Services, Charles Smith of Burns Motor Freight, and the team of Harry and Norma Vogel from U.S. Xpress Enterprises. The winning drivers received round-trip tickets to the California 500 NASCAR race at the California Speedway.

TCA has established a Web site (www.truckload.org) providing members with around-the-clock access to industry news and information. Initial features include daily truckload carrier stock quotes and fuel prices, online access to industry experts and association staff members, and online forums.

The Truckload Carriers Assn. announced that it will hold its 1999 annual meeting March 14-18 at the Bellagio Casino in Las Vegas.

While its OmniTRACS satellite communications system is the single most popular wireless service in the trucking industry, Qualcomm Inc. says it will soon broaden its offerings with new technology and expanded communications options.

During a press briefing held during the TCA meeting, a company spokesperson said Qualcomm will kick off the expansion by offering two untethered trailer tracking systems later this year, one using terrestrial-based communications and the other a new packet-data satellite service. It already offers a tethered trailer tracking system as an option with its current satellite communications service.

Both untethered services will use GPS for trailer location information and will be offered with optional sensors for detecting door openings, unscheduled movements, and available load capacity. Both will carry a rechargeable battery that should power the units for up to 30 days when unhooked from a tractor or other power supply. All messages will be handled by Qualcomm's Network Management Center, which currently processes OmniTRACS tractor communications.

The terrestrial-based trailer tracker will communicate over the existing analog cellular telephone network using a new technology that lowers communications costs by transmitting short packet-data messages over unused portions of the cellular bandwidth. Cost for the trailer should be under $300 and service cost is projected at less than $10 a month for one message a day, according to the spokesperson.

The satellite-based system will provide ubiquitous, or complete, coverage. Although Qualcomm has not yet identified the communications provider, the trailer tracking system's messages will not be carried by the current OmniTRACS satellite, but rather will use another satellite already in orbit. Trailer hardware should cost about $500 per unit, while message service will be similar to the terrestrial system's cost.

The optional sensors will add approximately $100 per unit to the hardware cost of either new untethered system, according to the Qualcomm spokesperson.

With market penetration among truckload carriers already high for its current satellite communications service, Qualcomm says it expects the new terrestrial and packet-data satellite services to help it move into private fleet and LTL shorthaul distribution operations.

An untethered trailer tracking system and an integrated dispatch/wireless communications package have been developed by GE LogistiCom, a division of GE Capital Services. Both are currently undergoingfleet tests, according to the company.

GlobalWave, the trailer-tracking system, features a self-powered terminal that integrates satellite transceiver, GPS receiver, antennas, and battery in a single package slim enough to fit between roof bows under a trailer roof. A variety of sensors for measuring trailer loads, monitoring cargo temperature, and other functions can be connected to the terminal via an RS232 serial port or four digital input/output ports.

Position and other collected information are relayed over a packet-data satellite system. The terminal can be programmed to send data on a scheduled basis, when it senses an "event," or when it is polled by a fleet. The unit's replaceable lithium battery is expected to last for at least a year, depending on transmission activity. A rechargeable alkaline battery will also be available.

Terminal costs are estimated at less than $500 and sensors should be about $100 each. Communications costs for the packet-data satellite system should run $10 to $20 a month, according to GE LogistiCom.

The dispatch/communications system, called FleetTracker, was initially announced last year but is now nearing commercial release. Software is Windows-based and provides automated dynamic dispatching with two wireless communications options. The satellite messaging service is provided by American Mobile Satellite Corp. and incorporates GPS vehicle tracking. The terrestrial service is provided by BellSouth Wireless Data (formerly Ram Mobile Data) via a hand-held RIMMS two-way pager that can handle both free-form and preprogrammed messages. It provides general location information based on the specific transmitter receiving a unit's signal.

In addition to dispatch, FleetTracker software can handle a variety of operational recordkeeping chores and can be used with a range of standard databases for integration with existing fleet information systems.

Closer working relations between the American Trucking Assns. (ATA) and the Truckload Carriers Assn. (TCA) will be top priority for TCA's incoming president Mac McCormick. Officially installed as TCA president at the group's annual meeting on March 18, McCormick is president of Best Way Express, a midsized truckload carrier headquartered in Vincennes, Ind.

Patching up what had in recent years become a rocky relationship between the two trucking trade groups can only help the industry as a whole get favorable resolution on regulatory issues, he said, speaking before the start of the annual meeting in Kona, Hawaii. As examples, McCormick cites movement on revising hours-of-service rules and relief on sharply increased telephone charges brought on by recent changes in FCC regulations.

Outgoing TCA president Dan England added that he has sensed a new attitude at ATA that should signal "an era of cooperation" between the two groups. Such an alliance, he said, "makes me optimistic that we'll finally get a ruling on hours of service."

Looking back over 1997, England, who is the CEO of C.R. England & Sons, said that a strong overall economy, combined with decreasing fuel prices and undercapacity at the end of the year, led to a good year for most truckload carriers. "It was a rare window of opportunity, and we had very good success getting rate increases last year," he said.

TCA has established a Web site (www.truckload.org) providing members with around-the-clock access to industry news and information. Initial features include daily truckload carrier stock quotes and fuel prices, online access to industry experts and association staff members, and online forums.

The Truckload Carriers Assn. announced that it will hold its 1999 annual meeting March 14-18 at the Bellagio Casino in Las Vegas.

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