ILMA Compoundings September 2018 - 24

time needed to secure carriers," she said, adding that the
company is also using intermodal to transport bulk and
packaged goods.
What's more, Allegheny Petroleum Products Co. has
increased stocking levels and bulk inventory levels to prevent
extended lead times with carriers and vendors, Kudis said.

Changing the Rules

Dave Osiecki, CEO of Scopelitis Transportation Consulting, said a strong economy and an inability to find qualified
drivers are two main factors spurring tight capacity, but a
smaller percentage of capacity crunch has resulted from the
electronic logging device (ELD) mandate that took effect
in December, resulting in better hours-of-service (HOS)
compliance.
The ELD mandate has made enforcing HOS rules
easier and tightened the freight market by eliminating
non-HOS-compliant capacity, Delco said.
However, Delco also said it is hard to determine how
much of the current capacity crunch is from the ELD
mandate and how much is the result of a stronger economy.
"I believe it's safe to say both combined have made this one
of the strongest trucking environments on record," he said.

"Many drivers in the market who have many
years' tenure have decided to either retire or
find other gainful employment, rather than
succumb to a new set of rules." - Barbara Kudis,
president, Allegheny Petroleum Products Co.

SEPTEMBER 2018

| COMPOUNDINGS | ILMA.ORG

Pilot Thomas Logistics has a fleet with more than 1,000
trucks and hires common carriers for additional capacity. A
lot of Pilot Thomas' trucks were required to install ELDs,
but Vice President-and ILMA President-Dave Croghan
said it was a seamless shift and the company didn't see a
decrease in productivity. "We have a very tight compliance
department," he said.
Drivers for Allegheny Petroleum Products Co. are exempt
from the ELD rule, as each driver does not travel more
than 100 air miles from home base more than eight times a
month. "This has allowed us greater flexibility to handle our
local deliveries and emergencies," Kudis said.
The implementation of ELDs and onboard recording
devices has caused some drivers to leave the industry.
"Many drivers in the market who have many years' tenure
have decided to either retire or find other gainful employment, rather than succumb to a new set of rules," Kudis
said. "This has left an even greater shortage in an already
struggling market."

Drivers Wanted

Delco said there are really only two types of truckload
markets - one where companies are short of freight and
one where they're short of drivers. "Any trucking executive
says they'd rather be short truck drivers than freight," he
said, adding that truckload rates wouldn't have gone up as
much as they have without the driver shortage.
Nearly 71 percent of all the freight tonnage moved in the
U.S. goes on trucks, the American Trucking Associations
(ATA) reported. The association estimates the industry is
short about 50,000 drivers. If current trends hold, the shortage could grow to more than 174,000 drivers by 2026.
When the economy is strong and the unemployment level
is low, people have a lot of other options before they get
behind the wheel, Delco said. Many carriers have raised pay
in an attempt to retain and recruit drivers. An ATA study
released earlier this year showed that the median salary for
a truckload driver working a national, irregular route was
more than $53,000 - a $7,000 increase from ATA's last
survey in 2013. A private fleet driver saw his or her pay rise
to more than $86,000 from $73,000, said Bob Costello,
chief economist for ATA.
In addition to rising pay, Costello said fleets were offering
generous signing bonuses and benefit packages to attract and
keep drivers.
"Our survey told us that carriers are offering thousands of
dollars in bonuses to attract new drivers," he said. "And once
drivers are in the door, fleets are offering benefits like paid
leave, health insurance and 401(k)s to keep them."

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ILMA Compoundings September 2018

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