The Electronic Logging Device Mandate Is Here, Now What?

Electronic logging devices can create more capacity for shippers, more pay for drivers and more profit for fleets.

Tom Cuthbertson
Tom Cuthbertson

The electronic logging device (ELD) mandate is published, but with a compliance deadline of December 2017, many commercial trucking fleets are taking a wait-and-see approach before implementing the technology. In its simplest form, an ELD is used to electronically record a driver’s record of duty status (RODS), which replaces the paper logbook some drivers currently use to record their compliance with hours of service (HOS) requirements.

Fleets that are slow to adopt the mandate likely don’t understand the myriad of benefits associated with implementing ELDs at an early stage, and unfortunately, are going to be leaving a lot of revenue lying on the table and losing out on substantial operational benefits. It’s important for fleets not to procrastinate and get a jump-start on ELD use in order to gain an edge on the competition and stay ahead of the game.

Before getting into the benefits of ELDs, here are a few basic regulatory preventive measures that the mandate addresses:

  • Form and manner violations. Such inspection violations are the most frequently issued, and can be attributed to missing, incomplete or inaccurate information that is required to be recorded. No longer must fleets worry about being fined for something as simple as a missing Department of Transportation (DOT) number, an inaccurate location at duty status change, incorrect times or mathematical errors. It’s estimated that fleets making the switch from paper logs to ELDs can reduce their form and manner violations by 90 percent.
  • Out-of-service inspection violations. Typically issued due to missing or incomplete log books, these violations can render the driver and vehicle out of service until the condition or defect can be corrected. Getting put out of service for the standard 10 hours can be detrimental for a fleet, as it loses revenue with every minute that a driver and cargo is off the road. Several out-of-service violations can affect a fleet’s bottom line and the ELD mandate addresses this issue.

Benefits beyond Belief

Based on fine amounts ranging from $150 to $1,100, it is estimated that HOS fines totaled over $330 million since the start of 2015. That’s equivalent to over 120 million gallons of fuel! This analysis alone represents the value of adopting ELDs early on, but the benefits don’t stop there. By transitioning from paper logs to ELDs, fleets can realize the following benefits:

  • Driver time savings. Paperwork can be time-consuming and a hassle that electronic log converts never want to return to. If it takes a driver 15 minutes a day to create paper logs—a conservative estimate—that equates to two hours on an eight-day run. With schedules very tight on delivery and pickup windows, it can be difficult to find a driver claiming that he or she couldn’t benefit from those two hours saved. ELDs equate to more time on the road and higher operational efficiency.
  • Dispatch efficiency. When dispatchers are up-to-date on a drivers’ hours and status, it allows fleets to better plan for loads and deliveries
  • A return on investment. Returns are realized through decreased fuel costs, reduced truck downtime and lowered crash rates, and the differences can be recognized immediately.
  • Simplified regulatory compliance. While complying with the ELD mandate, other regulations can also be easily satisfied, including driver vehicle inspection reports and the International Fuel Tax Agreement (IFTA).

ELDs can also have a positive impact on the driver shortage, a problem the entire industry faces.

Because ELDs can be used to track driving hours, mileage and the number of stops, fleets can leverage their use to incentivize drivers with different compensation plans based on efficiency. ELDs also help retention efforts by saving the driver valuable time, especially if the driver is crossing international borders. With various regulations across borders, it can be difficult to juggle complex requirements on top of the task at hand. By simplifying this process, ELDs enable drivers to focus on the most important thing—getting from Point A to B in a safe and efficient manner.

ELDs and the Supply Chain

ELDs get fleets one step closer to universal connectivity. Devices available on the market today are able to connect to a truck’s other onboard systems, and as a result, are collecting massive amounts of data. With so much data being generated, the supply chain stands to gain efficiencies learned from it.

Today, data is available in near real time, enabling companies to better monitor the logistics portion of its supply chain, and improve planning and delivery. To have readily available information before even realizing it’s needed means there are no dark spots. With improved visibility of where drivers are, how many hours they drove and overall driver availability, supply chain professionals are sure to get more creative about how they use ELD data to dispatch better.

Not unlike any other major changes, ELDs are bringing about dissenting opinions. Some drivers go as far to say that they may leave the industry before using an ELD. Trucking industry experts estimate that fleets—especially those that jumped through hoops to avoid compliance up until this point—may experience a short-term loss between 3 to 5 percent. Even worse, companies that are late adopters of ELDs, and that lack back-office support and dispatching software may stand to lose even more, making it even more critical for fleets to adopt early. The DOT believes that mandating ELDs can cut the number of truck crashes by 1,844 a year, avoid 562 injuries and save an estimated 26 lives a year.

In the end, ELDs stand to be a great benefit for the supply chain logistics industry. Through increased connectivity and improved safety, ELDs can have a positive impact on how the flow of freight is managed, creating more capacity for shippers, more pay for drivers and more profit for fleets. As ELDs gain adoption, the broader transportation industry is going to experience the multitude of benefits and find new ways to gain efficiencies. Fleets may have until 2017 to become compliant, but it’s not recommended to be the last one to jump on board.

Tom Cuthbertson is the vice president of regulatory affairs at Omnitracs.

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