Trucking costs are on a one-way road headed due north . . . here’s why

Oct 11, 2012 | 07:10 PM | Rollins Montgomery

Tags  Southland Tube, Rollins Montgomery, transportation industry outlook, trucking costs, regulations, CSA, Federal Motor Carrier Safety Administration, EOBRs driver shortage

As the U.S. economy continues to rebound from one of the worst cyclical downturns in history, we are beginning to feel the effects of some of the steepest challenges the transportation industry has experienced since deregulation. Several of the most pressing issues are identified below:

-- The transportation industry is entering this economic upturn with fewer trucks on the road and most experts are forecasting capacity will continue to decline.

-- The goal of the CSA, the new compliance, safety, and accountability system that the Federal Motor Carrier Safety Administration (FMCSA) implemented in December, 2010, is, in part, to streamline the process of identifying carriers with safety and compliance problems so the FMCSA can take the appropriate corrective action. In 2011, the FMCSA conducted a total of 18,428 reviews nationally and as of August 24, 2012, they had conducted 17,579 reviews nationwide. Based on these statistics, the FMCSA is on pace to conduct a far greater number of reviews in 2012 than in 2011.

As of August 24, 2012, 54,984 carriers nationally were on “alert” status, meaning they could be targeted for a review by the FMCSA if their safety scores do not improve. Once targeted, a carrier could be subject to fines or possible intervention by the FMCSA. If a carrier does not improve their CSA basics once intervened, the FMCSA can potentially remove their operating authority. The bottom line: -- Carriers can no longer tolerate noncompliance with these safety regulations. The exposure to fines and a change in the carrier’s safety rating is simply too great a risk.....