ELDs Haven't Reduced the Number of Carriers — Yet

Leading up to the ELD mandate on Dec. 18, 2017, some industry observers had predicted a mass exodus of trucks from the industry. But that hasn't happened, at least not yet. According to data from the U.S. Department of Transportation, the number of active carriers has actually ticked up slightly since ELDs became mandatory. There was just under a 1% increase in active carriers between December 18, 2017 and February 18, 2018.

A few months before the mandate went into effect, a DAT survey revealed that 30% of respondents, mostly owner-operators, said they planned to leave the industry rather than implement ELDs. Last week, DAT re-surveyed that same group and found that 91% of respondents have implemented ELDs. Of the group that had not yet implemented ELDs, more than half were exempt from the mandate.

The big question is, how many carriers will drop out of the industry after April 1, when trucks without ELDs will be put out of service?

ELD's Impact on Trucking

Even though the number of active carriers has not dropped since December, the ELD mandate has certainly had an impact on the trucking industry. Here's how:

Reduced capacity - In the first full month following the ELD mandate, January 2018, load-to-truck ratios — a measure of supply and demand — hit record highs. For vans, the load-to-truck ratio hit 9.9 in January, meaning there were almost 10 load posts for every truck posted on DAT load boards. That was 3 times higher than the previous January.

In January, the van load-to-truck ratio was just under 10 to 1.

Record-high rates - Rates also jumped to record highs in the first weeks following the ELD mandate. However, at the time it was hard to tell if rate increases were due to the mandate or to other factors, such as last-minute holiday and e-commerce deliveries, severe winter weather in many part of the country, or fewer trucks available as drivers took time off for the holidays, or some combination of reasons.

By February, those factors had worked their way through the system, but van rates were still 32% higher than in the previous year. And February's high rates didn't appear to be the result of increased demand. There were more loads offered on DAT load boards, but data from DAT RateView shows no dramatic increase in the number of spot market loads that actually moved in February 2018, compared to February 2017.

Van rates hit record highs in January, following the ELD mandate.

Decreased productivity - Carriers who stayed in the industry and adopted ELDs were met with new challenges. For example, what previously was a one-day trip may have turned into a two-day trip when the driver ran out of hours, because ELDs lack the flexibility of paper logs. See our blog post ELD Impact Could Be Greatest on 450- to 600-Mile Lanes.

Less patience for sluggish shippers - Another outcome of the ELD mandate has been increased impatience with shippers and receivers who detain carriers at the docks. A recent article in American Trucker noted that for the past 4 to 5 years, shippers have had the upper hand. But now, "ELDs are changing the economics of trucking in such a way that the smart carriers who really understand their costs are just saying: I can't do this. I can't wait five hours to be loaded."

News Update: FMCSA Announces New ELD Waiver for Transporters of Agricultural Commodities

An ELD Solution for Carriers

DAT researched ELD providers and selected the ELD made by KeepTruckin as a top model that is easy to use, affordable, and meets FMCSA specifications. To learn more, or to request a demo, see the KeepTruckin ELD web page.



Pat Pitz

Pat Pitz is the editor of the DAT Solutions freight broker newsletter. He has nearly 20 years experience as a professional writer and editor. Before joining DAT, he spent 8 years at a Portland advertising and public relations agency, where he wrote newsletters and other content for a variety of high-profile clients, including several in the trucking industry.



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