BIRMINGHAM, AL. While carriers are focused on the upcoming implementation of CSA 2010, there is another group of businesses just as focused on the new federal safety-scoring system: their customers.
Shippers are growing more intent on learning everything they can about their carriers, and that focus is increasing for a number of reasons, Chris Schenk, vp of product marketing for Xata Corp., told attendees here at the McLeod Software Users’ Conference yesterday. Schenk was joined by Tom Cuthbertson, Xata director of industry solutions.
Schenk, while highlighting Xata’s Turnpike as a possible solution, underscored the overall reality for carriers: Shippers will have access to a fleet’s CSA numbers. Armed with this information, a shipper can pressure a carrier into a better rate, or even pull its freight altogether-- even if FMCSA said the carrier is operating safely under the system.
“Shippers are looking to identify risk, even if CSA says the carrier is fine,” Schenk said. “The challenge to you as carriers is to proactively measure the risk … ultimately your shippers want to know who your worst drivers are and why.”
Schenk’s best advice is for a carrier to be proactive. To do sos, he strongly promoted the use of electronic onboard recorders (EOBRs), and not just as an effort to promote Xata’s own product.
“As we continue down the journey of CSA, EOBRs are going to be mandated [for poor performers], and that’s how it happened in Europe 26 years ago,” he said. “First it was for bad performers, and then it became a mandate for all.”
In the mid-1980s Europe began requiring trucks to have tachographs, which provided a historical look at what was going on inside the truck. Eventually, as mobile communication technology improved, those voluntary tachographs became required and now all trucks sold in Europe must be equipped with one.
There is no doubt there has been a lot of activity on the regulatory side, Cuthbertson said, and more is yet to come. He noted the ongoing testing of wireless roadside inspection systems as well as regulation 395.16, which defines how data will be transferred from an onboard recorder to officials, to name just two.
“In my 26 years, I have never seen the regulatory environment this explosive,” Cuthbertson said. “I have not seen as many regulations as I have in the past two years in my previous [26] years.”
So how does this change a fleet’s operations? According to Schenk, it could result in a monetary hit if a supplier pulls a contract. To combat that, he recommends installing EOBRs. Then fleet managers will bee aware of what is going on within a fleet before its customers are.
“The way shippers see this is if you are mandated to [install] EOBRs, then your service to them is going to change,” he said.
Turnpike, which Xata acquired back in December, sends information from the truck through a PDA device and then to a web interface, where managers receive reports that are then used to proactively manage the fleet.
For some fleets, the prospect of installing a solution such as Turnpike, plus the cost of a PDA device might seem daunting. But it’s not, Schenk argued. Turnpike costs just $35/month per truck, he said. He also cited research that indicates that 60% of truck drivers already have personal cell phones. By 2015, it is predicted that 70% of drivers will be using PDAs for work-related functions.
“Drivers are consumers and they’re getting used to this [technology],” Schenk said. “EOBRs are going to be the keys to keeping contracts and finding new ones.”
The use of EOBRs, Cuthbertson said, helps fleets manage areas of their operations they’ve never managed before. “There a lot of things that are before our faces, the forest for the trees, that can help us [be proactive] in preventing future problems,” he said.
And it’s those future problems that shippers are beginning to focus in on. Even though a fleet’s CSA numbers might be good, a shipper can always find a fleet with better numbers and less risk. That could put a contract at risk.
Schenk gave an example of a driver who was delayed due to weather. As a result, to make the required delivery, he exceeded his allowable driving time and when he was involved in an accident that resulted in two deaths, he, the fleet, and the shipper were all held responsible by the courts.
“The liability does get transferred to shippers,” Schenk said. “The trick is not installing [EOBRs], the trick is using the equipment.”
