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The Roemer Report On-Line, June 2003
FINAL HOS RULES UNVEILED: For the first time since 1939, the Federal Motor Carrier Safety Administration (FMCSA) has announced substantial changes to the hours-of-service (HOS) rules for commercial drivers. The new rules, which take effect January 2004, allow truckers to drive 11 hours per day after 10 consecutive hours off-duty and reduce a driver’s workday, including loading, unloading, and breaks, to 14 hours. Under the new rules, some short-haul drivers are permitted a once-weekly 16-hour day, designed to save the industry millions in operating costs. The Bush Administration decided to drop a proposal to require electronic onboard recorders in trucks to monitor driving time and encourage compliance, but FMCSA said it plans to study other similar technologies that hold promise. Rules for drivers’ daily logs remain unchanged. The federal government predicts that the final rule will increase productivity and improve safety, saving up to 75 lives and preventing as many as 1,326 fatigue-related crashes each year.
NEW RULES GET MIXED REVIEWS: The recently released HOS rules immediately brought mixed reviews from industry leaders. While the American Trucking Associations (ATA) supports the rules, the Owner-Operator Independent Drivers Association (OOIDA), unions, consumer and safety groups, and a leading insurance industry association say that expanding driving time by one hour a day will not improve safety. OOIDA, which released a statement strongly opposing the rules, said it believes the regulations will have a minimum impact on driver fatigue. “Not until truck drivers are no longer regularly pressured to meet unrealistic delivery deadlines, and they are no longer forced to perform uncompensated work for as many as 33 to 44 hours per week, will we see a significant reduction in fatigue issues,” declared OOIDA. The association said fatigue will continue to be a problem as long as shippers make truckers wait before they can load or unload trucks and as long as truckers are forced to do the loading or unloading without compensation. Teamsters president James Hoffa went a step further, saying the new rules will increase driver fatigue and therefore reduce highway safety. David Snyder of the American Insurance Association said, “Eleven hours of consecutive truck driving is excessively dangerous for all roadway users—not just the truckers themselves.” Despite the criticisms, the ATA declared the new rules as “a good mixture of common sense and sound science.” Bill Graves, ATA president, said, “The rule is easy to understand, easy to comply with and easy to enforce–three principles that reflect ATA’s position on this important safety issue.” Former ATA chairman David McCorkle was not quite so enthusiastic: “It’s not everything we wanted, but…we can live with this one.”
A SHOPPING SPREE? Large for-hire carriers and large private fleets are planning to buy new trucks and trailers in the next six months to meet growing demand for freight, according to a poll by CK Marketing & Communications in Columbus, Ohio. “Fleets did not tell me in these interviews that they think they’ll buy new equipment,” said Chris Kemmer, owner of CK Marketing and Communications, “they said they are going to buy new equipment.” Kemmer said fleets in the survey indicated “they have picked up new business and that there’s more freight out there to haul.” According to Fleet Owner, Kemmer polled more than 25 fleets that operate at least 50 trucks and found that 79 percent of them said they plan to buy new power units within six months and 30 percent plan to buy new trailers. Kemmer noted that the fleets voiced dissatisfaction over the reduced fuel mileage of the new cleaner-burning diesel engines but no longer doubt their durability and reliability. Perhaps as a testament, Schneider National recently placed additional orders for 53-foot trailers from Wabash National Corp., bringing Schneider’s total trailer purchase for the year to over $100 million. “We believe that this order increase is an illustration that the trucking industry, as a whole, is beginning its recovery,” said Wabash CEO Bill Greubel.
CAR-TRUCK FATALITIES DOWN AGAIN: Preliminary estimates of traffic fatalities show that deaths from large truck crashes dropped 3.5 percent last year. The National Highway Traffic Safety Administration (NHTSA) recently released information indicating there were 4,902 deaths attributed to car-truck accidents in 2002. The drop in fatalities marks the trucking industry’s biggest improvement in nearly a decade. The bad news, however, is that highway fatalities overall were up. Last year, an estimated 42,850 people died in highway accidents—734 more than during the previous year. ATA president Bill Graves said that increased traffic enforcement for both cars and trucks, and for speeders in particular, would help reduce the highway death toll. Meanwhile, NHTSA also found that: (1) vehicle miles traveled during 2002 increased to 2.83 trillion, versus 2.78 trillion in 2001; (2) 42 percent of all highway deaths were attributed to drunk driving, up from 41 percent in 2001; (3) fatalities from motorcycle accidents increased for the fifth straight year.
HAZMAT HAULERS SCRUTINIZED: A new rule issued by the Department of Transportation and the Transportation Security Administration (TSA) requires hazardous materials haulers to undergo background checks, which include reviewing criminal, immigration, and FBI records. Drivers with military or civilian convictions for certain violent felonies during the past seven years or those found to be mentally incompetent will be prohibited from obtaining or renewing the hazmat endorsement. In accordance with the USA Patriot Act, the background checks will verify that drivers are either U.S. citizens or lawful permanent residents. The rule also prohibits states from issuing, renewing, transferring, or upgrading a CDL with a hazmat endorsement, unless the TSA has first performed a background check on the individual. “This is a landmark rule in that it establishes vital safeguards to protect our national transportation network from possible acts of terrorism,” said TSA Administrator Adm. James M. Loy. “The rules will further ensure the continued safe transport of a range of products—from chlorine to gasoline—crucial to the economic viability of the United States.”
WHO IS MANAGING YOUR MONEY? Are employees really the right people to manage their own retirement accounts? Increasingly, benefits experts are saying no, and companies are turning to professional money managers to oversee retirement accounts. Professionals are taking over for several reasons. For one, employees acknowledge that they are uncomfortable taking charge of their retirement accounts. In addition, professional advice adds up. Studies indicate that when money managers oversee employee retirement plans, the returns run about 2 percentage points higher than employee-run accounts. Those annual 2 percentage points can add up to hundreds of thousands of dollars over an employee’s career. While employee-managed 401(k) plans have been popular for years, experts say workers really shouldn’t be expected to make the same financial decisions that Wall Street experts make every day. While professionally managed accounts are still in their infancy, financial experts expect the trend to explode in the near future. The decision to turn to money managers has affected all sectors, not just corporate America. For example, the state of Nebraska recently passed legislation that will phase out its employee-controlled retirement plan. State officials learned that employee-managed accounts averaged 4.9 percent annually while the state’s pension plan saw returns near 8 percent. Next year, Nebraska state employees will be required to join a modified pension plan that will guarantee them an annual return of a minimum 7 percent.
LOFTY ASPIRATIONS: Executives who embrace a Renaissance mentality today will move far beyond the leaders who simply meet the basic needs of their organization. Martha Finney, author of In the Face of Uncertainty, says Renaissance leaders look past the present day concerns of profit and growth. They embrace learning and look for new ways to bring their visions to fruition. Here are some of the primary characteristics of Renaissance leaders: (1) They value human ability. Many companies tout their technological capabilities in an effort to be competitive. The Renaissance leader recognizes that human ability will always outweigh technology. (2) They serve as counselors. Renaissance leaders work daily to establish trust, respect, and confidence, recognizing that when a crisis occurs, their power will come from the sense of truth they’ve created. (3) They’re generous with knowledge. The more an organization shares its knowledge, the more competitive it becomes. For example, Motorola established itself as a billion-dollar leader in cellular phones in China because it had the foresight to train Chinese engineers. (4) They create meaning for work. Renaissance leaders must help employees see the deeper values of their work. By doing so, they inspire workers to be driven not by a paycheck, but by a mission. (5) They love life. Renaissance leaders embrace all that life has to offer, from the arts, to music, to literature and the humanities. They recognize that these pursuits add meaning and beauty to life at home and at work.
Youth is the gift of nature, but age is a work of art.—Garson Kanin, playwright and director