Optimizing routes and schedules could mitigate HOS cost impact
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Putting math to work to cut HOS impact

Aug. 7, 2013
Algorithmic solution said to reduce costs and accident risk

Motor carriers may mitigate the economic impact of the stricter Hours-of-Service (HOS) rules now in place by way of an algorithmic “optimization procedure” formulated by two academics engaged in the field of international logistics.

The algorithm resulted from extensive research and analysis of the HOS rules in the U.S. as well as of similar regulations worldwide recently conducted by Asvin Goel, professor of International Logistics at Jacobs University in Bremen, Germany, and Thibaut Vidal, researcher at CIRRELT (Interuniversity Research Centre on Enterprise Networks, Logistics and Transportation) in Montréal, QC, and MIT in Cambridge, MA.

Our experiments demonstrate that European Union [driving hours] rules lead to the highest safety, whereas Canadian regulations are the most competitive in terms of economic efficiency. Australian regulations appear to have unnecessarily high risk rates with respect to operating costs. The recent rule change in the United States reduces accident risk rates with a moderate increase in operating costs,” write Prof. Goel and Vidal, in their scientific paper titled “Hours of Service Regulations in Road Freight Transport: An Optimization-Based International Assessment.”

In their paper, the authors describe what they regard as “an effective optimization algorithm for minimizing transportation costs for a fleet of vehicles considering business hours of customers and hours-of-service regulations.”

Goel and Vidal explain that the algorithm they developed “combines the exploration capacities of population-based metaheuristics, the quick improvement abilities of local search, with forward labeling procedures for checking compliance with complex hours-of-service regulations. Several speed-up techniques are proposed to achieve an overall efficient approach.” 

They add that their “proposed approach is used to assess the impact of different hours of service regulations from a carrier-centric point of view.”

According to Goel, by using the algorithm, fleets can simultaneously minimize transportation costs and accident risks. He stated that what’s often overlooked when the impact of government regulations is analyzed is that “companies can adapt to the new regulations and adjust their processes accordingly. A central element of our study is to simulate the motor carriers' capability of changing plans and schedules to adapt to new hours-of-service regulations.”

In another recent paper, titled “Hours of Service Regulations in the United States and the 2013 Rule Change,” Goel looked deeper still at the impact of the recent HOS rule change and possible reductions of the daily driving time to less than 11 hours. According to this study, the rule change will reduce accident risks by up to 2% with an increase in transportation costs of less than 0.2%.

He found that If the daily driving time was limited to at most 10 hours-- the limit before the 2004 rule change-- accident risks would be reduced by around 5% while transportation costs would increase by less than 1%.

 “Our results indicate that in their regulatory impact assessment the Federal Motor Carrier Safety Administration [FMCSA] may have underestimated the safety benefit of reducing the daily driving time limit and overestimated the resulting cost increase,” stated Goel. “It may well be that the net benefit of reducing the daily driving time to 10 or even 9 hours is positive.”

In the rule-change paper, Goel pointed out that “the introduction of the break provision in 2013 will reduce accident risks by 0.6% to 2.4% without significant impact on costs. The reductions in accident risk resulting from reduced daily driving time limits of 10 hours and 9 hours are significantly larger for all instance sets. The risk reduction is accompanied with a moderate increase in variable costs.

“The relative increase, however, is of a much smaller magnitude compared to the relative reduction in accident risk,” he continued.  “Furthermore, it appears that the impact on variable costs is smaller if time windows must be considered.

“The reason for this is that truck drivers sometimes have to wait until a time window opens and schedules typically contain more off-duty time than in the case without time windows,” Goel continued. “With a lower ratio between on- and off-duty time, the stricter constraints on on-duty periods appear to have less impact on operational costs.”

According to Goel, the simulation-based method discussed in the paper for assessing the impact of HOS rules on operational costs and road safety is unlike previous approaches because it “considers the fact that transport companies can optimize routes and schedules to avoid additional costs resulting from stricter regulations.”

Goel closed the paper with an observation about the FMCSA’s approach to analyzing the impact of the latest HOS rule.

“As the FMCSA did not take into account the capability of trucking companies to reduce the economic impact of stricter regulations by optimizing routes and schedules, and as our experiments showed that stricter regulations reduce accident risks for drivers independent of whether they are working close to the weekly limits or not, we must conclude that the regulatory impact assessment of the FMCSA overestimates the economic impact of reducing the daily driving time limits and underestimates the safety benefits,” he argued.

“Considering these findings,” Goel concluded, “the FMCSA may come to a different conclusion when reconsidering whether the daily driving time limit should be reduced or not.”

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