July 20, 2013

Safety rules for truckers have price tag

The drop in productivity means billions of dollars to the industry, which says the cost 'has to be passed on.'

Bloomberg News

WASHINGTON – New U.S. safety regulations requiring truckers to work shorter shifts may cut productivity, worsen a driver shortage and boost freight costs for the $8.4 trillion in goods hauled each year by American big rigs.

click image to enlarge

In this 2011 file photo, an Oakhurst truck driver prepares to head out for deliveries. New U.S. safety regulations requiring truckers to work shorter shifts may cut productivity, worsen a driver shortage and boost freight costs for the $8.4 trillion in goods hauled each year by American big rigs.

Jill Brady / Staff Photographer

That is to be balanced by a decline in deaths and injuries from crashes and savings in health-care costs as the regulations improve driver safety, according to federal regulators.

The rules that took effect this month may reduce productivity by about 3 percent, translating into $18 billion in additional costs for an industry with annual revenue of around $600 billion, according to freight data and forecasting firm FTR Associates. Training and transition expenses may add another $320 million to truck companies' annual tabs, according to an estimate by the Department of Transportation.

"That cost of transportation has to be passed on," said Charles Clowdis, a Nashville, Tenn.-based director of transportation advisory services at IHS Global Insight. "If I run a company, it means I'll have to have more drivers doing the same thing, which means I'll have to raise my rates, and that'll raise the cost of the goods I'm transporting to the consumer."

The new regulations reduce the maximum number of weekly hours drivers can spend on the road to 70 from 82. The rules also mandate a 34-hour rest period each week that would require the nation's 1.6 million long-haul drivers to be off two consecutive nights. And the regulations mandate a 30-minute break after eight hours on the road.

About 1,400 crashes, 560 injuries and 19 deaths each year will be prevented, said Marissa Padilla, a spokesman for the Federal Motor Carrier Safety Administration. The rules will bring about annual savings of about $470 million from improved driver health and $280 million as a result of fewer highway accidents, the Department of Transportation said July 1.

Truck-related fatalities rose 2 percent to 3,757 in 2011 and injuries increased 10 percent to 88,000, according to data compiled by the National Highway Traffic Safety Administration. Those levels were below the annual average 4,296 deaths and 74,800 injuries over the decade ended in 2011. Fatigue was a factor in about 13 percent of serious crashes involving large trucks, according to a July 2007 study by the two national safety groups.

Joan Claybrook, consumer co-chairman of the Advocates for Highway and Auto Safety in Washington and a former NHTSA administrator, said the regulations don't go far enough and that truckers should be limited to 10 consecutive hours behind the wheel and a continuous 48-hour rest period per week.

"I don't know any consumer who wouldn't rather pay an extra five cents for a can of beans in order not to have a driver fall asleep," Claybrook said in a telephone interview.

The International Brotherhood of Teamsters, which negotiates time behind the wheel and mileage rates, said the 34- hour weekly rest period is too brief for the 600,000 people it represents in the industry.

"There's concern that we're sharing the road with drivers who are not as well-rested or as alert as they should be," Fred McLuckie, director of federal legislation and regulation for the Teamsters in Washington, said in a telephone interview. "What price do you put on safety?"

Trucking accounts for the biggest share of freight transportation in the world's largest economy in terms of value and tonnage, according to a 2009 Transportation Department report, the latest available. Trucks moved about 71 percent of the total value transported. In terms of volume, they hauled 9 billion tons, a 69 percent share.

"Our economic system has been blessed by an extremely reliable, extremely efficient truck system," said Larry Gross, a senior consultant at Bloomington, Ind.-based FTR. "People will end up paying more for trucks."

(Continued on page 2)

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