The dawn of a new millennium brings us a new business reality shaped by intensified competition, economic expansion, renewed labor concerns, technological advances, government regulation, environmental compliance pressures, and safety mandates - to name but a few issues. All will impact freight t ransportation, logistics, and commercial vehicles in challenging and exciting ways. In the following analysis.
FLEET OWNER editors and contributors examine these issues to provide you with the insights needed to help prepare and test your competitive strategies for 2000 and beyond.
Customer service demands continue to drive fleet equipment decisions
Despite the scope and pace of change occurring at the macro-economic level, trucking's greatest challenge may come from the premise on which it was founded - customer service. The implementation of lean manufacturing and efficient consumer response systems, which has given the national economy new and sustained punch, is clearly reflected in the new transportation services demanded by shippers and receivers.
"Shippers are demanding shorter transit times, reliability, responsiveness, and flexibility as they implement these systems," says Chris Brady, principal of Commercial Motor Vehicle Consulting and author of the report, "The For-Hire Trucking Industry in the 21st Century: Implications for Equipment and Service Providers."
"Transportation services must be reliable with products delivered as scheduled and undamaged, since there is very little inventory," he says. "Missed schedules or damaged freight may cause a manufacturer to halt production or a distributor to lose sales. Carriers must respond quickly to shippers' freight requests, since lean manufacturing and efficient consumer response initiatives require commodities to quickly flow through the supply chain. Carriers must also be flexible since very few industries experience stable or predictable sales. This requires carriers to handle volatility in shipment volumes."
In exchange for the increased service requirements, shippers are rewarding a smaller group of carriers with more freight. Shippers expect carriers to add value within the supply chain as they gain knowledge of the shippers' operations. Simplicity, i.e., dealing with few carriers, also reduces administrative costs for shippers while making it easier to measure carrier performance.
The increased performance requirements continue to fuel outsourcing of activities viewed as inefficient and not critical to some types of organizations. Some businesses have eliminated their private fleet, switching to for-hire carriers for transportation services, while other firms have outsourced logistic activities as well as transportation services. Paradoxically, many businesses are now beginning to recognize the competitive advantages of directly controlling their own distribution channels, and new questions are being raised about outsourcing.
The switch to for-hire carrier services and the corresponding elimination or downsizing of the private fleet has been occurring for many years as for-hire carriers have responded to market demands with a dramatically increased product portfolio. "The switch to for-hire carriers from private carriage has largely occurred in on-highway applications," Brady says. "Following deregulation, many firms did not restructure their private fleet operations to improve operating efficiencies, since transportation was not their primary business."
However, renewed interest in logistics as a competitive tool has caused some companies to consider a new, more valuable role for their private fleets, especially in local and regional operations tied to growing e-commerce transactions.
"The switch to for-hire on-highway transportation services from private carriage will continue to stimulate growth of the for-hire trucking industry in the 21st Century, but at a slower rate," Brady explains.
The growth of regional and local distribution operations driven by e-commerce will affect equipment purchases since for-hire carriers cannot provide those services cost-effectively using equipment specified for on-highway applications. The share of midrange and medium-duty trucks purchased by the for-hire carrier segment will increase as they compete more heavily with private carriage in local and regional distribution applications. Refocused private fleet operations must also be refunded to increase light- and medium-duty equipment productivity in these critical local and regional areas.
"There's all this '.com' business developing out there, and some one has to move it," says John McQuaid, president and CEO of the National Private Truck Council. "There's a great opportunity now for light- and medium-duty private fleets to do that work."
Fleets are also rapidly adopting information technology because a smooth and efficient supply chain requires the transfer of real-time information. The communication of information - and its integration into seamless flows of data - transformed into pro-active information guidance and control devices are the technologies that will drive our industry into the next century, maintains James L. Hebe, president and CEO of Freightliner Corp. This will be the case whether goods are ultimately moved by for-hire or private carriers.
In addition, "truck styling will become increasingly more important in this industry's next generation trucks," he says. "Truck styling must become far more individualistic - it must become more friendly to the motoring public and it must encompass the entire vehicle package, not just the hood as it does today."
"Our customer's environment has never been more in transition. As we globalize, deregulate markets, and consolidate companies, and as this thing called e-business unfolds, the increasing demands of our customers to custom-tailor trucks for specific customer requirements will explode," Hebe adds.
The relationship between for-hire carriers and shippers will also continue to evolve as for-hire carriers offer services that go beyond transportation. For-hire carriers are becoming more involved within the supply chain as they offer logistics services. This includes managing inbound and outbound freight, running warehouses and distribution centers, managing inventories, order fulfillment, and light manufacturing and assembly.
However, private fleets continue to have one advantage when it comes to logistics, according to NPTC's McQuaid. They operate within a corporate culture and are run to contribute to the overall corporate goals. "Private fleets aren't in the trucking business," he says. "It's easier for them to get their arms around the whole operation when it comes to information technology management and logistics."
The need to expand geographically and increase service offerings has stimulated mergers and acquisitions, interline agreements, and marketing agreements within the for-hire trucking industry. "Consolidation will cause the average fleet size of a for-hire motor carrier to increase," Brady says.
"The for-hire trucking industry, however, will remain fragmented as compared to other industries such as automotive," he continues. "Still, consolidation will have a large impact upon products and support services demanded by carriers. This implies that suppliers to the for-hire trucking industry must become more knowledgeable with respect to products, support services, and financial matters. Suppliers cannot rely solely on a good product to generate sales, since for-hire carriers are looking for a complete package - finance, product, and support services - to lower their costs."
Indeed, all fleets will expect their suppliers to expand geographically to support their product and service needs. Similar to shippers, fleets want suppliers that can meet their needs wherever they operate. This implies that suppliers must have the coverage to meet fleets' global, national, or regional needs.
While the pressure is on fleets to do more, the challenge is also to do more with less. Competitive pressures have made it difficult for for-hire carriers to expand profit margins by increasing freight rates. Since many shippers still view transportation services as a commodity, their carriers have difficulty increasing freight rates without attracting competition from other fleets. The difference in the growth rates of the Producer Price Index and revenue per mile of for-hire carriers from 1980 to 1997 shows how fierce competitive pressures have kept downward pressure on freight rates. About the only way for-hire carriers can increase profit margins is to reduce operating costs.
While private fleets may become more central to some businesses' competitive strategies, they, too, will have to focus on reducing operating costs in order to keep the pace set by nimble and aggressive for-hire carriers.
No one in trucking, it seems, will get much rest in this new millennium.
High demand for goods and services will keep economy growing
Truck traffic is expected to grow in 2000, although at a more moderate pace than last year. A high demand for goods and services means that the economy in general will continue to grow, but just not at the record pace set in '99. Sparked by employment gains and wage increases, consumer spending increased by 5.3% last year, becoming the driving force behind this growth.
This year, the rate of growth should slow to about 4%, and will be most noticeable in durable goods, which are more sensitive to fluctuations in interest rates than non-durable goods and services.
Although wage gains are expected again this year, gains in employment aren't likely to be as strong as they were in the last few years. In addition, there is some movement in the financial community to curtail some of the riskier segments of consumer debt. Part of the reason spending increased so dramatically last year was the fact that consumers took on debt at a rate greater than at any time in our history.
Consumer demand for non-durable goods will also slow somewhat in 2000, which will have a direct impact on linehaul traffic and the growth of the local and regional distribution sector of the trucking industry.
Overall, the demand for consumer goods during the last quarter of '99 and throughout 2000 looks positive, with growth rates that will keep inflationary pressures under control.
This has not been the case during the last few years. Two years ago we faced multiple reductions in interest rates (designed with expansion in mind), while last year we saw a number of rate increases (for a slight dampening effect).
Building-materials growth is likely to slow somewhat as a result of a more moderate increase in the nonresidential sector in 2000.
As wages increase, manufacturers will be pressed to invest in productivity measures that will hold overall labor costs per output to a minimum. Backlogs and current inventory levels will lead to an increase in manufacturing output during the next three economic quarters.
The export market for U.S. goods is expected to improve as other economies recover, and as the exchange rate reflects a weakening dollar. These two factors should support exports of capital goods throughout 2000. One exception is agriculture, where foreign markets are likely to be soft throughout 2000.
While world trade is expected to grow more than it did last year, there is some concern that Y2K issues could affect foreign trade and financial transfers. Even if the systems are not fully Y2K compliant, however, alternative procedures should enable both transactions to take place successfully.
While the decline in rail service brought on by mergers has clearly benefited linehaul truck traffic, cost considerations will shift most of that freight back to the rails as service improves.
However, railroads are not expected to make any significant new inroads in linehaul activity for the next several quarters. LTL carriers endured a strike in 1994 so that they could put 29% of their linehaul traffic on the rail. However, poor service levels have brought that figure down to well below 10%.
Since rails turned out not to be a viable option, LTL carriers had to make the investment necessary to move the freight via highway. The costs incurred make it unlikely that LTL carriers will move aggressively to increase the rail portion of it's shipments during the next several quarters.
Overall, linehaul activity is expected to grow slightly faster than the production of goods, as distribution patterns continue to require more frequent and time-sensitive deliveries.
Economic indicators also point to a steady expansion in the demand for local and regional transportation services. For example, increases in residential construction have placed further demand on retail distribution services. In addition, service industries such as communications and lawn care have grown considerably. As a result of these trends, local and regional transportation providers will have to expand their fleets or increase utilization to meet the growing demand. And as computerized routing and real-time dispatching become more affordable to these fleets, we can expect both to take place.
Taking freight transportation to the next level of efficiency
Continuous productivity improvements will be absolutely essential just to keep up with growing freight volumes, if the forecast prepared for the ATA by Standard & Poor's DRI is correct. According to DRI, total tonnage of primary freight shipment in the U.S. will increase from 11.2-billion tons to 13.6-billion by 2007, an increase of 21.2% over ten years, and trucks will carry 56% of it.
This means that if nothing else changes, it will take a 19% increase in the number of medium- and heavy-duty vehicles by 2007 just to move that extra tonnage, according to Martin Labbe of Martin Labbe & Assoc., and trucks will have to drive nearly 34% more total miles. Factor in the shortage of skilled drivers, already-congested highways, the growing public concerns over truck safety, and ever-tighter operating ratios for fleets and you have one tough math problem to solve.
No matter how you do the arithmetic, the solution will have to include greater productivity - better utilization of every asset the industry has, from equipment to people. And it will have to involve everybody.
Technology the key "Technology will be the key to efficiency," predicts Edward Forman, president and CEO of Prophesy Transportation Software. "We still have only about 50% utilization of our total vehicle capacity. And about 30% efficiency on return trips is very typical because the average backhaul is one and one-half times as long as the outbound trip, with just 60% of the revenue per mile. That means if we can improve our national efficiency by 10%, we can save $7 billion annually.
"The big problem has been communication and information sharing," Forman continues. "There are hundreds of thousands of empty trucks at all times in the United States and hundreds of thousands of loads. Smart software will be able to look at that mass of data about trucks, loads, and drivers and make good matches or even combinations of matches, and the Internet will make that information universally available to the carriers, shippers, and receivers who need it. This is the kind of capability we are putting into our dispatch software today.
"The Internet marks the first time there has been a network for the whole economy, one everyone can utilize," he adds. "Trucking operations tend to be under-capitalized and far-flung, with greater communication needs than many other industries, so the Internet is particularly valuable to us."
Prophesy, like virtually every other major software supplier to the trucking industry, is Internet-bound at top velocity. "One thing we are doing immediately, and everyone should, is providing Web-based access to shipment status information for our customers," says Forman. "Within two months, carriers, shippers, and receivers will be able to log-on and check shipment status, which will be updated continually by the carrier's dispatch system. One relatively small carrier customer says this will save them $2,000 per month on phone calls alone. The next step will be to provide use of all our software via the Internet."
Load matching and more Another of the hottest Web-based trucking applications, according to Forman and many others, is load matching because it addresses both theshipper and the carrier side of the freight equation at once, creating the opportunity to collaborate for improved productivity. The National Transportation Exchange (NTE) is one of the oldest electronic commerce systems for shippers tendering loads and carriers tendering cargo capacity.
Launched in 1995, NTE works like a stock exchange, allowing members to conduct business together, which capitalizes on available transportation capacity in a real-time environment. Unlike many other strictly "load-matching" services, NTE both pays the carrier and invoices the shipper when the delivery is confirmed.
"The trucking industry is following the path already taken by the airlines," says Greg Rocque, founder of NTE. "Fleets have equipment assets they have already paid for that have to be utilized as fully as possible. Productivity is simply the only way to keep margins."
NTE's service considers all their carriers' available cargo capacity and all available loads in suggesting matches. "Our system's filtering engine filters and re-filters endlessly trying to find the best possible opportunities for member carriers and shippers," says Rocque. "The Internet allows us to optimize in the context of the real world. Eventually, the industry will have a whole lot of virtual networks handling nearly all freight capacity."
Does this mean freight transportation is doomed to become a commodity service, managed by totally automated computer systems like one giant spot market? "Absolutely not," according to Rocque. "What it does mean is that, like the airlines, trucks will have a retail market and a wholesale market- for their excess capacity," he explains. "NTE's role is to help fleets grow the wholesale side of their business."
"Five or six years ago, the airlines were concerned that air travel was becoming a commodity," recalls Jim Davidson, NTE's new CEO, who came from the computer airline reservations industry himself. "Instead they discovered that most customers still wanted extra services and they wanted to be loyal to their favorite carriers. The same will be true in the trucking industry. Service, quality, and loyalty will continue to be extremely important."
"Optimization breeds collaboration," adds Rocque, "and collaborative models are true win-win scenarios." NTE's recent alliance with SAP AG underscores Rocque's point. It is intended to bring SAP customers the ability to visualize the whole supply chain while inventory is in motion and to execute all shipments through NTE, which optimizes their placement according to preferred routing and notifies the SAP customer of the execution. "The alliance gives SAP customers the ability to extend optimization beyond the enterprise," says Rocque. "It is a logical extension of the collaborative business environment of the mySAP.com Marketplace."
In October 1999, the Descartes Systems Group Inc. also announced the addition of a freight exchange system to its own portfolio of Web-based, collaborative fulfillment management and optimization solutions. Called the Collaborative Logistics Exchange (CLE), the new system is designed to enable shippers, forwarders, carriers, and logistics companies to collaboratively plan future capacity utilization and manage a real-time load and equipment tendering process.
Frictionless marketplace "With CLE, an airline, ocean carrier, or trucker will be able to notify its trading partners of excess capacity and create a frictionless marketplace that enables spot bids or real-time bartering of prices and service agreements," explained Art Mesher, exec. vp-corporate strategy for Descartes. "Unlike public load posting services and freight exchanges, CLE is designed to allow each trading partner to manage its own private trading partner communities, enabling a personalized trading exchange with its key suppliers and customers via the Internet."
From the loads posted by shippers, authorized carriers can select loads for review via specific search criteria from the CLE Internet browser window. They can also post equipment availability, accept or reject specific loads, and receive and confirm pickup date, time, and other information, according to Descartes. Once a load is posted through its delivery, CLE is designed to provide real-time visibility. If activities deviate from the plan, the system issues a delivery exception notification to all involved parties, providing an opportunity to resolve the problem before it impacts the receiver.
Fleets and owner-operators too small to have a community of regular trading partners but still interested in maximizing the productivity and profitability of their trips also have Internet freight-matching services options. In September 1999, for example, DAT Services launched DATInternet, a load-planning service specifically for drivers and small carriers. Located at www.datinternet.com, the new solution gives DAT customers another way to access the company's services in addition to the PC, satellite, telephone or fax delivery options currently available. The cost is $29.95 per month.
DATInternet also gives carriers access to e-mail, credit services, driver forums, weather, chat rooms, transportation job postings, and links to other information services, according to Susan Little, director of Internet Offerings for DAT Services, who notes that the service already has "well over 700 subscribers, mostly owner-operators, carriers, and brokers." The next step for DAT Services, she adds, will be private networks, or extranets, for fleets that want the capability to quickly handle mission-critical information.
"The Internet, and freight-matching services in general, give fleets the opportunity to maximize asset utilization and efficiency by lining up backhauls before their trucks are empty," Little observes. "As many as 30% of today's backhauls are empty. This alone represents a huge opportunity to boost productivity."
High stakes At the start of this new century, improving productivity has become one of the most critically important tasks for each fleet and for the economy as a whole.
"One of the things that has made this economy run so successfully over the past several years has been our steadily increasing productivity, which has helped to push inflation down and hold it down," observes Don Schneider, president and CEO of Schneider National Inc.
"Improvements in the area of logistics have made a huge contribution to this sustained period of growth and prosperity," he continues. "Now, however, logistics productivity appears to be at a plateau, according to analysts like Robert Delaney of Cass Information Systems. How will the freight transportation industry continue to boost productivity now that the low-hanging fruit, the obvious logistical inefficiencies have been eliminated?"
At least part of the solution will depend upon every company's willingness and ability to share information and collaborate using the best-available technology to facilitate the process. Requiring as it does this unique mix of old-fashioned values, hard work, and vision, it is a perfect job to entrust to the trucking industry. No one could do it better.
Trucks and trailers, like the processes utilized to manage them, are also being transformed into tightly integrated systems by the pressure to increase productivity. "The truck must become an integrated unit - from engine to trailer and including every component and mission-critical element on-board the vehicle," noted James L. Hebe, Freightliner president and CEO, in remarks during a panel discussion at the 1999 Truckload Carriers Assn. annual meeting.
"On the operational side, we will be moving from passive monitoring of vehicle location and truck performance status to predicting where a driver/truck must be at some future time, and also predicting system maintenance," he said. "Productivity and efficiency will be preplanned against the predictable vehicle position requirements of a logistics system and the future capabilities of the truck and the driver."
"Shippers and receivers need information, and that information is highly perishable because it changes every minute," observes Greg Rocque, president of th e National Transportation Exchange.
The need for current information on-demand is what makes the Internet such a good communication tool for fleets, who are building Web sites by the hundreds to provide customers with information such as shipment status, rate quotations, proofs of delivery, bills of lading, and even activity reports to help with planning. A quick tour of a few fleet Web sites makes the Internet's role in the future of freight transportation abundantly clear. The road to greater productivity runs through www.here:
Atlas Van Lines, www.atlasvanlines.com;
Boyd Brothers Transportation, www.boydbrothers.com;
Contract Freighters Inc., www.cfi-us.com
Covenant Transport, www.covenanttransport.com
Dupre Transport, www.dupretransport.com
G.I. Trucking, www.gi-trucking.com
Landstar Inway, www.landstar.com
Roadway Express, www.roadway.com
Roberts Express, www.roberts.com
Schneider National, www.schneider.com
Southeastern Freight Lines, www.sefl.com
U.S. Xpress, www.usxpress.com
The list of new environmental regulations continues to grow
Many fleet managers consider environmental regulations to be a nuisance that does not contribute to their mission. Unfortunately, ignoring these regulations can create more than a nuisance - they can create fines, penalties, and even jail time. Whether you think they're a nuisance or not, one thing is for sure - there's no shortage of them and they're always changing. A few of the most important environmental regulations expected by the American Trucking Assns. (ATA) next year are discussed below.
Water discharges will be a big issue in 2000. Phase II of the Stormwater Permit Program will implement some type of permitting program for smaller municipalities that were unaffected by Phase I. While no industries will take a direct hit from Phase II, it's likely that the small municipalities may share their costs and pollution reduction needs through fees and permits on industrial dischargers such as fleet facilities.
Phase II contains the No-Exposure Certification (NEC), which is a checklist designed to help clean facilities opt out of stormwater permit programs. Thanks to ATA's work, the NEC specifically mentions that adequately maintained vehicles are not sources of stormwater pollution. The NEC must be adopted by states before it becomes effective.
In September 2000, the Environmental Protection Agency (EPA) should publish version three of the Multi-Sector General Permit (MSGP), the general stormwater permit used across most of the country. When completed, the MSGP is expected to include stronger Endangered Species and Historic Resources sections, likely increasing facility compliance costs.
New Underground Injection Control (UIC) wells (i.e., drywells, sumps, and septic systems) that receive motor vehicle waste, such as from washbays and vehicle-maintenance shop floor drains, will be prohibited as of April 2000. Existing UIC wells that receive motor vehicle waste will be banned in groundwater protection areas starting in April, and the ban will expand geographically over most of the country through 2008. Discharge of any vehicle waste into the septic system that services your facility's bathrooms will put the septic system into the prohibited group.
Facilities with Spill Prevention, Control, and Countermeasure (SPCC) plans should receive a boost in June 2000 with the publication of what is expected to be a burden-reduced version of SPCC. EPA is promising major renovations that should save facilities time and money.
This may be the lucky year when Congress finally passes Superfund reform measures. At stake for the trucking industry are changes in who pays for cleaning up abandoned hazardous-waste sites, otherwise known as Superfund sites. Many trucking companies have gotten roped into Superfund liability through small amounts of maintenance waste that ended up in landfills that later became Superfund sites. Two current reform bills in Congress provide for a fair cost allocation process, expedited settlement for contributors of small quantities of waste, and liability exemptions for used oil sent for recycling.
On the engine and fuels side of things, the EPA is expected to issue a proposed rule on diesel fuel quality early this year. The focus of the rulemaking is the need to lower diesel sulfur content in order to dramatically reduce diesel engine emissions by enabling the use of catalytic aftertreatment devices. New standards for model-year 2007 and later engines may be required to reduce emissions of nitrogen oxides (NOx) and particulate matter (PM) by as much as 90% over current standards.
To enable engines to meet these stringent new standards, EPA is planning to cap future sulfur levels somewhere between 5 and 40 parts per million (ppm). Estimates suggest it will cost the average refinery approximately 4-9 cents/gal. more to make lower sulfur diesel.
The properties and performance of lower-sulfur diesel are also an issue since removing sulfur will decrease fuel lubricity. On the positive side, however, decreases in diesel sulfur may reduce the corrosive effects of exhaust gas recirculation (EGR).
Truck-smoke testing is likely to continue as a regional issue, particularly in the northeast. With the signing of a regional smoke testing agreement, look for Maine, Maryland, Massachusetts, New York, Rhode Island, and Vermont to join New Hampshire, New Jersey, and Connecticut in performing smoke opacity testing of heavy-duty diesel trucks.
The regional agreement will help establish a uniform approach to diesel-truck emissions testing, saving the industry from multi-state approaches. Especially valuable to the industry is the reciprocity agreement preventing multiple state citations for the same violation. States outside the northeast that will be examining smoke testing this year include Indiana, Georgia, Texas, Pennsylvania, and Oregon.
With this list of issues and more on the horizon, fleet managers should have their hands full in the coming year.
[Fern Abrams is the manager of environmental affairs at the American Trucking Assns. (ATA) and Steve Hensley is an environmental specialist at ATA who also manages the Green Truck Environmental Compliance Assistance Web site (www.truckline.com/greentruck). For more information contact the authors or Allen Schaeffer, ATA vp-environmental policy at 703-838-1786 or e-mail [email protected]]
Politics will have a hand in who becomes first head of safety agency
With the passage of the Motor Carrier Safety Improvement Act of 1999, politics will play a large role in who becomes the head of the new Motor Carrier Safety Administration. Vice President Al Gore, who has handled many recent appointees, has to be particularly careful that his choice for administrator of the new safety agency does not cause a confrontation with the Senate that could hurt his bid for the presidency.
According to the law, the Administrator "shall be an individual with professional experience in motor carrier safety. The Administrator shall report directly to the Secretary of Transportation." Therefore, the appointment not only has to pass industry scrutiny, but organized labor as well because of its opposition to full implementation of some NAFTA provisions.
Senator John McCain, R-Ariz., who as chairman of the Senate Commerce Committee played a large role in writing the law, also has a vested interest in the nomination. If the nominee succeeds in improving truck safety, it will be a boost for McCain.
With safety already such a hot political issue, we can expect to see a greater push for technology-based safety devices. And since its dedicated safety administration now puts truck safety on a par with that of the aircraft and maritime industries, many of the safety items and procedures employed in those modes will be transferred to trucks.
Take black boxes, for example. It's no longer a matter of "if," but rather a matter of "when." CDL licensing standards will be tightened and trucking companies will be under greater scrutiny.
The power of local politics will continue to put pressure on the industry. New Jersey's banning of interstate trucks on certain roads, for instance, is being watched carefully by other states that may follow suit. In addition, local noise ordinances will continue to take aim at trucks as part of the "quality of life" movement that enjoys wide support among taxpayers.
Turning to the environment, interest in diesel particulates will increase as more reports reveal the link between cancer and diesel emissions. The EPA's National Center for Environmental Assessment recently pegged diesel emissions to cancer, although research is ongoing. And although the trucking industry reputes these findings, Los Angeles' South Coast Air Quality Management District contends that 71% of the cancer risk in that area can be attributed to particulates in the air, including those from diesel emissions.
The industry tackles the technician shortage
Sometimes the only way to solve a problem is to roll up your sleeves and just handle it, which is exactly what some companies in the trucking industry are doing about the diesel technician shortage. And it's not a moment too soon.
Several new recruiting, recognition, and training programs have already been launched as a result of their initiatives, and the entire industry stands to benefit. You might want to call them up and just say thanks.
Last October, for example, Chevron Lubricants launched a major campaign to recognize the industry's top technicians and support on-going training efforts. Called the "Diesel Technician Solutions Program," it includes a Technician of the Month competition with awards for individual winners and for the companies that employ them.
"Like everyone else in the industry, we recognize that the diesel technician shortage is reaching critical levels," explains Mike Dargento, market segment manager, commercial automotive, for Chevron Lubricants. "It's impacting virtually everyone who operates or utilizes a vehicle service facility, and so we decided it was time to become a part of the solution."
Technicians selected as Technician of the Month are featured in special Chevron advertisements and will receive additional recognition from Chevron. Their employers receive a $2,000 award that may be applied toward technical training for either newly hired or veteran diesel technicians, or used for the Scheig Hiring and Performance System for Diesel Technicians.
"The program is designed to help give technicians some of the recognition they deserve," says Dargento. "We also hope it will help to raise the status of the diesel technician job in general. Although we're really just getting started, initial response to the program has been very gratifying."
The teams of technicians who maintain vehicles in construction, mining, quarry, and other transportation sectors are being honored by Castrol Heavy Duty Lubricants through its Maintenance Masters Program. According to Castrol, the competition was created in 1997 to recognize maintenance departments for their critical role. Judges chose two teams as winners each year, one from an off-road and one from an on-road operation.
Other companies have also launched special initiatives to help address the technician shortage. Miami-based Ryder System, for example, has announced that it will use its network of 26 Ryder Recruiting Centers (for recruiting Ryder drivers) to also recruit technicians. The recruiting effort is one element of a four-part program that also includes a marketing campaign, an incentive-based employee referral program, a defense outplacement referral system, and partnerships with technical schools.
In Canada, Volvo Trucks Canada and the Toronto campus of Centennial College have started a campaign of their own called the Modified Apprenticeship Program (MAP). Together, they've established a heavy-truck technician program where students will receive training on Volvo trucks, engines, and components. The initiative also includes recruitment evenings at area high schools, according to Volvo.
Additional technician recruiting help is coming from The Maintenance Council (TMC), which has produced a recruiting package that includes a video developed by TMC's Future Technician Task Force, plus a technician recruitment manual developed by Navistar International Corp. International was also recognized for its technician training efforts in 1999 when the company received two Automotive Training Managers Council (ATMC) Training Excellence Awards.
These new programs, and others, add to the work already being done by organizations such as the Vocational Industrial Clubs of America (VICA) and the National Institute for Automotive Service Excellence. If your company would also like to lend a hand - there's still plenty of work to be done.