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Smaller Carriers In Demand: Shippers will use smaller carriers to handle a rise in freight in the coming months, according to a new survey. Rather than rely on a few core providers, shippers surveyed said they would use a greater number of truckload carriers, including smaller companies, because (a) smaller carriers generally have greater capacity available than larger carriers, and (b) larger carriers demand more accessorial charges for things like extra labor, vehicle storage, and hazmat hauling. Other findings in the Bear, Stearns & Co. survey include:
- Shippers say that truckload capacity is the tightest it’s been in seven years, while less-than-truckload capacity is only slightly tighter than one year ago. Both TL and LTL are expected to tighten further in the coming year.
- Shippers predict significantly higher rate increases (nearly 4 percent) for truckload freight and modest increases (2.5 percent) for LTL freight as
volume increases.
- The majority of shippers believe TL and LTL rates will hold steady during the seasonally weak months of January and February.
Keeping Our Food Safe: Last month, the Food and Drug Administration issued regulations that require companies that transport or distribute food to establish and maintain records on the freight. The rule, part of the Bioterrorism Act, requires records on all types of food to be maintained for one year. (Companies that manufacture, process, pack, receive, hold, or import food must also maintain these records.) The records may be kept in electronic or paper format, with truckers able to use bills of lading and expense bills as acceptable forms of recordkeeping. The records must include the names of the transporter’s immediate previous source and the transporter’s immediate subsequent receipt, origin, and destination points, date shipment received and date released, number of packages, description of the freight, route of movement during the time the food was transported, and transfer point through which the shipment moved. Should the FDA ever believe that food was tampered with, then any records regarding the food must be made available to the FDA within 24 hours.
Fleets’ Biggest Concerns —Drivers, Fuel: The two top concerns of fleet managers are the driver shortage and high fuel prices, according to a new survey by First Fleet. The truck leasing company found that 77 percent of fleet executives said driver shortages are a critical issue in trucking. Sixty-one percent said they were so concerned with fuel prices that they made vehicle spec’ing adjustments with fuel efficiency in mind, and 59 percent reporting utilization strategies, such as increasing loads per truck.
Respondents also reported consolidating fuel purchases and training drivers on ways to conserve fuel; one respondent is studying shutoff valves for idling. Fleets now have even more incentive to reduce fuel costs, as OPEC ministers recently announced they would withdraw 1 million barrels of oil from daily production. That means fuel prices will go up again, and if OPEC decides to make further cuts when it meets at the end of the month, prices will rise even more. Taking nothing for granted, private fleets participating in the survey said they will pre-buy trucks to avoid the fuel-efficient 2007 models, which many have concerns about. According to the First Fleet survey, 93 percent of the executives said they plan to replace nearly 25 percent of their fleet within the next year, and 72 percent said they would replace half of their fleet in two or more years.
Drunk Vs. Drowsy: There’s a thin line between the effects of driving drunk and driving drowsy. A survey by the AAA Foundation found that almost nine out of
10 police officers reported that they had stopped a driver who they believed was drunk but who turned out to be drowsy. The National Highway Traffic Safety Administration (NHTSA), which helped coordinate the survey, says that as many as 100,000 police-reported crashes each year are the result of driver fatigue. That means 1.5 percent of all reported crashes are due to drowsy driving. At least 71,000 people are injured each year in such crashes, and annual fatalities are estimated at 1,500. NHTSA estimates fatigue-related accidents account for a monetary loss of about $12.5 billion each year. The survey also revealed that 89 percent of police officers believe that drowsy driving is as dangerous as drunk driving; 93 percent of officers believe drowsy driving is a serious problem for four-wheel vehicles; 97 percent believe that it’s a serious problem for commercial drivers; and 95 percent believe that drivers responsible for a crash when they are drowsy should be charged with a driving violation. A previous AAA study found that of drivers involved in drowsy driving accidents, one-third reported sleeping an average of less than six hours per night.
Seat Belt Use Way Up: Safety belt use has reached record levels, according to recent statistics released by the Department of Transportation (DOT). The data also show that Arizona and Hawaii have broken the 95 percent seat-belt-use barrier for the first time. Earlier this year, a National Highway Traffic Safety Administration (NHTSA) survey found that seat belt use has reached record levels of 80 percent nationwide. According to DOT, NHTSA’s “Click It or Ticket” campaign has produced significant increases in seat belt use since 2001. Since that time, seat belt use nationwide has increased 7 percent, saving an estimated 3,400 lives. The biggest gains in usage were in Arizona, Hawaii, Washington, Oregon, and Michigan. “It’s no coincidence that as safety belt use reaches record levels that we are seeing record low fatality rates,” said Transportation Secretary Norman Mineta. “We will keep up the pressure because we still have too many Amerians dying on our roads and too many Americans not wearing their safety belts.
Public Duped By Fake Insurance: The General Accounting Office says that the number of bogus insurance policies sold to U.S. consumers is on the rise, resulting in $252 million in unpaid health insurance claims alone. A survey found that 74 percent of the public is unaware of the need for increased vigilance when buying insurance. The National Association of Insurance Commissioners (NAIC) survey also revealed that 83 percent of consumers believe that information from their state insurance department could help them avoid fake insurance, yet only 8 percent of Americans surveyed said they have contacted their state insurance department to confirm the legitimacy of a provider before buying insurance. “In the area of fake health insurance alone, the General Accounting Office reported 144 fake health insurers nationwide sold bogus policies to more than 200,000 policyholders between 2000 and 2002,” said the NAIC president. “This is simply unacceptable.” Illegitimate insurance companies typically target older adults and small businesses or associations that want to reduce health care costs. Consumers are too often lured into buying bogus policies because they are typically less expensive than real policies, but coverage is either nonexistent
or insufficient.
Spreading Joy: Every day a businessman stopped to admire a street vendor’s flowers before he rushed off to work. And every day, the flower vendor offered a cheerful smile and said, “Thanks for stopping by.” The businessman had been stopping at the cart for over a year now and still hadn’t bought a single flower. Yet each time he stopped, he was greeted with that same friendly smile and simple thank you. The next day, the man decided to buy a bouquet of flowers for his assistant. He expected the flower-cart owner to be even more appreciative. But after the man’s purchase, the flower vendor offered his familiar gap-toothed smile and said, “Thanks for stopping by.” The businessman could no longer resist and asked the vendor, “Why do you thank me for stopping every day when I never buy anything?” “Well,” the man said, pausing for a moment, “Everybody who stops and admires my flowers makes me glad of what I do. I try to bring some joy to this busy world and when someone stops to look, I feel I’ve done my job.” “I see,” said the businessman. “Well, thanks for being here.” The businessman hurried off to work, smiling all the way.
It’s much easier to point out the problem than it is to say just how it should be solved.
—John Kenneth Galbraith, economist
