Trucking Biz Buzz

DAT Solutions: Reefer rate tops $2

It was a hot week for refrigerated carriers.

The average spot truckload rate for reefer freight surged 5 cents to $2.02/mile during the week ending July 9 and topped $2 for the first time since October 2015, reported DAT Solutions, which operates the MembersEdge load board.

Available loads of all types fell 19 percent, and truck posts were down 22 percent compared to the previous week – as expected when you compare a four-day workweek to a five-day workweek.

As a result we saw an increase in load-to-truck ratios:

  • Reefer L/T ratio: 6.5 (up 1 percent compared to last week after a sharp rise in June)
  • Van L/T ratio: 3.5 (the highest ratio yet this year, up 6 percent)
  • Flatbed L/T ratio: 15.6 (down 1 percent)

National average spot truckload rates surged compared to the previous week:

  • Van: $1.70/mile, up 8 cents
  • Reefer: $2.02/mile, up 1 cent 
  • Flatbed: $1.85/mile, down 10 cents

Major-market indicators: This is still a transition period for produce, with the focus shifting north. The average Chicago outbound rate was up 6 cents to $2.12/mile, and load counts there were down less than you’d expect for a four-day workweek. Atlanta ($2.37/mile, down 11 cents) and Lakeland, Fla. ($1.56/mile, down 12 cents), both fell.

Lanes with gains:

  • Sacramento-Portland, Ore.: $3.13/mile, up 13 cents
  • Green Bay-Joliet: $2.84/mile, up 9 cents
  • Dallas-Phoenix: $1.30/mile, up 13 cents

Reefer rates and volumes continue to decline at markets in Arizona and Texas that share a border with Mexico. Example: McAllen fell 6 cents to $1.75/mile.

Vans rates jump: Spot van rates typically drop after July 4 but not last week as the average rate climbed higher than June averages. Some truckers may have taken an extended holiday, which made it harder for shippers and brokers to find trucks. Or it could be an improving freight market. Next week’s numbers should tell us more.

Volumes lower: Van load posts dropped 19 percent and truck posts declined 24 percent - in line with expectations for a holiday week.

Hot-lanta: Atlanta remains the No. 1 market for spot van load posts on DAT MembersEdge; the average outbound rate was $2.04/mile. Dallas moved into the No. 2 spot (average rate: $1.59/mile), with Dallas-Houston up 7 cents to $2.30/mile.

Northern climbs: Outbound rates in Philadelphia and Allentown, Pa., saw some of the biggest rate increases last week. The lane from Allentown to Boston was up an average of 14 cents to $3.24/mile.

Trending down: At $1.92/mile, the average Memphis rate slipped 4 cents. That market is closely tied to retail, so it’s not surprising to see rates slide right after the end of the quarter.

Rates are derived from DAT RateView, which provides real-time reports on prevailing spot market and contract rates, as well as historical rate and capacity trends. All reported rates include fuel surcharges.

Get the latest rate trends at DAT.com/Trendlines or join the conversation on Twitter with @LoadBoards. Look for more information about load availability and rates at OOIDA’s MyMembersEdge.com, and listen in each Wednesday to Land Line Now for more talk about where to find profitable freight.

 

Judge approves $13.5 million settlement for misclassified drivers

Nearly four years of a court battle could be nearing a close for hundreds of drivers embroiled in a lawsuit against Exel Direct. A U.S. District Court judge in Northern California has approved of a preliminary settlement of $13.5 million to the plaintiffs for allegations of misclassification as independent contractors, according to court documents.

In a lawsuit originally filed in August 2012, 386 drivers for Exel Direct claimed the company misclassified them as independent contractors in addition to:

  • Failure to pay minimum wage
  • Failure to pay overtime
  • Failure to provide off-duty meal periods
  • Failure to provide off-duty rest periods
  • Unlawful deductions from wages
  • Cost of physical examinations
  • Coerced purchases
  • Reimbursement of business expenses
  • Failure to keep accurate payroll records
  • Failure to furnish accurate wage statements
  • Waiting time penalties
  • Unfair competition

According to the lawsuit, prospective drivers for Exel Direct were required to obtain a business license proving they were a LLC and sign an “Independent Truckman’s Agreement.” Applicants had to undergo drug and alcohol testing at their expense and agree to future testing at the company’s discretion throughout employment.

Despite requests for Spanish translations, contracts were provided in English only and were not open to negotiations. The one-year contract remained in effect year-to-year unless otherwise terminated.

Drivers also had to purchase or lease vehicles from a third party through Exel Direct. Costs of leased vehicles were deducted from paychecks. Exel Direct required control and exclusive use of any equipment, including the vehicles. Two weeks of training were also mandated, which discussed how to drive a vehicle, what speed to drive, what to discuss with customers, etc.

Several more allegations, including the demand that drivers speak English during deliveries, were mentioned in the lawsuit.

A fairness hearing for the $13.5 million settlement is scheduled for Dec. 9.

 

Freight tonnage in May decreases slightly for trucking

Official freight numbers for May are in. The index, which measures freight movement in tons and ton-miles, reveals freight was up for all freight modes except trucking and air freight.

According to the Bureau of Transportation Statistics of the U.S. Department of Transportation, the Freight Transportation Services Index for May increased by 0.2 percent to 121.8. May’s TSI is a 1.5 percent decrease of the all-time high of 123.7 set in December 2014.

The May index is 28.6 percent above the low set during the recession in May 2009. TSI records began in 2000.

Trucking freight went down to 136.1 from 137.2, a decrease of less than 1 percent. However, numbers from the American Trucking Associations reveal a tonnage increase of 2.7 percent in May to 139 from 135.3 in April. ATA calculates the tonnage index based on surveys of its membership.

According to the DOT, TSI’s growth lines up with monthly increases in personal income, personal consumption and imports of goods. In addition to higher employment, May also experienced a slight increase in the Institute for Supply Management's Manufacturing index, suggesting accelerating manufacturing growth, according to BTS.

May’s freight TSI increase is the third month-to-month increase for the year. Although edging higher, the TSI index for May is below January’s level of 122.6. February and March’s decreases were only the third back-to-back monthly decreases since December 2013. In all three cases, the next month represented an increase of 1.2 percent or more, including three of the four largest increases in that period.

 

Navistar trucks affected by Cummins recall regarding ECMs

Navistar is recalling five models of trucks, including ProStar, due to an issue with Cummins engines equipped with certain engine control modules, according to National Highway Traffic Safety Administration documents. Volvo recalled 129 VNL trucks in June for the same issue.

More specifically, certain 2017 International ProStar, LoneStar, PayStar, HX and 9900 trucks with Cummins ISX15L engines equipped with certain ECMs are being recalled. Approximately 1,191 trucks are affected.

These ECMs may experience an internal electrical short that can cause a fuse to blow, resulting in an unexpected engine stall without the ability to restart the engine, according to NHTSA.

Owners will be notified by Cummins and have the ECM replaced for free. The recall is expected to begin Aug. 19, 2016. For more information call Cummins at 800-343-7357 or call Navistar at 331-332-1590.

NHTSA campaign number for this recall is 16V-453.

 

Explaining the FMCSA’s new registration system

Starting Sept. 30, 2016, The FMCSA’s new online system called the Unified Registration System, or URS, will be the means of getting a U.S. DOT number and registering your operating authority, adding or updating registration(s).

If you own a trucking business, you’ve probably been hearing about it. The new registration system does away with a lot of paperwork, requires regulated trucking businesses register online, and eliminates the old MC number, FF or MX number.

According to OOIDA Director of Regulatory Affairs Scott Grenerth, “In one sentence, the URS is a single, online federal information system that businesses use to register and update their information” with the Federal Motor Carrier Safety Administration.

It’s common to get URS mixed up with another registration program called UCR. Grenerth explains that the URS and the Unified Carrier Registration (UCR) are not the same thing. They sound similar, but they are different.

“The URS is the FMCSA’s new online system,” says Grenerth. “It’s different from UCR, which is not part of the FMCSA. The UCR program is a federally mandated, annual state-administered registration program. The UCR’s sole purpose is, well, to just collect money from trucking entities and distribute it to participating states.”

The URS rule applies to all interstate motor carriers (including private and for-hire passenger and property motor carriers), freight forwarders, brokers, intermodal equipment providers (IEPs), hazardous materials safety permit (HMSP) applicants/holders, and cargo tank manufacturing and repair facilities under FMCSA’s jurisdiction. Mexican-domiciled carriers conducting long-haul operations are exempt.

The URS will require online registration for all filers, will use only the U.S. DOT number as a sole identifier, will impose a new fee schedule, and will keep a record on financial responsibility and your BOC-3. It replaces multiple forms and the registration functions of several systems such as the Licensing and Insurance System and the Motor Carrier Management Information System (MCMIS).

It is designed to simplify the process of registering, to reduce paperwork and errors, and to make it possible to electronically screen all applications to identify high-risk carriers, including potential reincarnated carriers.

FHWA first announced the plans for such a system back in 1996. When trucking got its own agency within the administration, the agency inherited the task of developing the URS plan. Through the years, it’s been rough path, but FMCSA issued the final rule for the Unified Registration System on Aug. 23, 2013.

URS requirements are being rolled out in a phased approach. The online registration application was available for first-time applicants on Dec. 12, 2015. All applicants will begin using URS for registrations and changes starting Sept. 30, 2016. Enforcement for existing “entities” is effective Dec. 31, 2016.

The requirement for electronic filing of the Form BOC-3, designation of process agent, comes into effect on Sept. 30, 2016. However, companies already registered with FMCSA as of that date will not be required to comply until Dec. 21, 2016.

According to the overview webpage on the agency’s website, FMCSA will also begin issuing a separate and distinct safety registration, consistent with the URS final rule and new statutory requirements. Existing registered carriers with an active U.S. DOT number (who are not under an operations out-of-service order or who have not had their operating authority registration revoked) will hold safety registration when the URS is fully implemented.

All brand new applications for registration received on or after Sept. 30, 2016, will incur a $300 registration fee for each distinct registration type – including safety registration and each requested operating authority registration. A new application for registration and fees will be required if an applicant’s registration has been revoked (but the applicant will retain the same U.S. DOT number).

No fees will be required for businesses that are already registered and are simply filing a biennial update or a name/address/form of business change.
After Sept. 30, 2016, applicants seeking reinstatement of a suspended registration must pay a reinstatement fee of $10 for each request for reinstatement after that date.
OOIDA’s Grenerth says there have been some changes to the schedule for the URS roll-out and advises carriers and regulated entities to get familiar with the outreach material and FAQs provided by FMCSA on its website. There’s also a printout version of a UCR brochure, says Grenerth, and a glossary and a “need-to-know” flyer.

For more information on the URS or assistance, contact OOIDA’s Business Services - Permits and Licensing Department at 800-444-5791.

 

Trucking job losses in June largest in more than a year

Transportation jobs experienced its fifth monthly loss in June, including the fourth decrease in trucking jobs.

The overall transportation sector lost more than 9,000 jobs in June, according to the U.S. Department of Labor’s Bureau of Labor Statistics. Since the beginning of the year, the transportation and warehousing sector has a net loss of more than 29,000 jobs.

The truck transportation subsector experienced a decrease of approximately 6,300 jobs in June after the industry lost 2,400 in May and gained 700 in April. Year-to-date, the trucking subsector has a net loss of 9,500 jobs. June’s loss was the largest monthly decline since last March when the trucking subsector lost 6,800 jobs.

Trucking experienced the largest decrease with 3,000 fewer jobs, followed by “transit and ground passenger transportation” with a decrease of 6,000. After two consecutive months of the largest decrease, the warehousing and storage subsector saw the largest increase with 4,700 more jobs in June, reducing the net loss for the transportation sector.

Last year, the trucking industry suffered a loss in only two out of 12 months. Nearly 7,000 trucking jobs were eliminated last March and 4,000 eliminated in September. December’s increase of more than 23,000 jobs was the largest in 2015.

Average hourly earnings for the transportation and warehousing sector were $23.29 for June – a 21-cent increase from May. Hourly earnings for production and nonsupervisory employees increased 19 cents to $21.07. Average hourly earnings for private, nonfarm payrolls across all industries were $25.61, 2 cents higher from the previous month. Compared with a year ago, average earnings have gone up by 2.6 percent.

According to the report, the unemployment rate for transportation and material moving occupations is down to 6.7 percent from 6.9 percent last June. The overall unemployment rate for the country was up 0.2 percentage points to 4.9 percent, first increase since April 2011. Over the past five years, the unemployment rate each month has either declined or went relatively unchanged. The number of long-term unemployed changed little to 2 million, accounting for approximately one quarter of the unemployed.

 

Cummins recall affecting Volvo VNLs

The Cummins recall of more than 5,400 ISX12 and ISX15 engines involves 129 Volvo truck owners with 2017 Volvo VNLs.

Volvo is the first heavy-truck manufacturer identified to be part of the Cummins recall of more than 5,000 ISX12 and ISX15 engines. The recall will specifically address a defect with the engine control module that may develop an internal electrical short circuit, possibly resulting in the engine stalling without warning, according to the NHTSA recall notice.

The Volvo trucks specifically affected by the recall have either the Cummins ISX12 or Cummins ISX15 engines and were manufactured between March 15 and April 20.

Cummins will be notifying the owners of the trucks, and dealers will replace the existing ECM with a new one, free of charge. The recall is expected to start July 7, according to the NHTSA recall.

Owners may contact Cummins customer service at 800-343-7357 or Volvo customer service at 800-528-6586. Volvo’s number for this recall is RVXX1604.

 

New Love’s in Oklahoma includes more than 60 parking spaces

Truckers travelling through Oklahoma on U.S. Highway 412 have another option to add to their list of places to park and rest. Love’s Travel Stops has announced a new location in Enid, Okla.

Located at 42nd Street off of Highway 412, the new Love’s Travel Stop will feature more than 60 truck parking spaces. This marks the third Love’s opening in Oklahoma this year and 70th overall in the state.

The 8,000 square-foot facility is open 24/7. The new Love’s features 63 truck-parking spaces, five showers, RFID cardless fueling, Cat scales and other driver services. Customers can also enjoy gourmet coffee, fresh fruit, gift items, a Carl’s Jr. restaurant and more.

For more information, visit Loves.com.

 

U.S. DOT: Slight increase in NAFTA truck freight in April

The U.S. Department of Transportation’s Bureau of Transportation Statistics reports that in April trucks moved nearly 67 percent of all the international freight – with trains, planes, ships and pipelines picking up the rest. Trucking was the only mode to experience an increase when compared to April 2015.

The value of freight hauled across the borders decreased a small fraction of a percent compared with March when freight went up 7.6 percent from the previous month. April marks the first decrease after two consecutive increases in February and March.

Compared to April 2015, freight was down 3.2 percent. Year-to-year, NAFTA freight was down every month in 2015.

Trucks were responsible for more than $60 billion of the $90.4 billion of imports and exports in April. Rail came in second with more than $14 billion.

Vessel and pipeline freight when compared with last year contributed to the yearly decline in U.S.-NAFTA trade flow due to plummeting crude oil prices, according to BTS. Freight totaled $90.4 billion, down $82 million from the previous month and down nearly $3 billion from April 2015.

Pipeline freight experienced the steepest decline at 30.5 percent, a smaller drop than March’s 33.2 percent decrease. Trucks had a 0.8 percent increase, the only increase among the five modes.

Nearly 61 percent of U.S.-Canada freight was moved by trucks, followed by rail at 17 percent. U.S.-Mexico freight went down by 0.1 percent compared with April 2015. Of the $44.5 billion of freight moving in and out of Mexico, trucks carried 73 percent of the loads.

 

Cummins recalling more than 5,000 engines for ECM issues

Cummins is recalling approximately 5,400 ISX12 and ISX15 engines, according to National Highway Traffic Safety Administration documents. An issue with the engine control module can short circuit.

ISX12 and ISX15 engines manufactured March 7, 2016, through April 12, 2016, are affected. Part number for the ISX12 is 4358814 and the ISX15 numbers are 5317106 and 4358814. Affected engines may short circuit and blow a fuse, resulting in the engine stalling without warning. The engine cannot be restarted until the ECM and fuse are replaced.

Owners will be notified by Cummins, and the ECM will be replaced with a new one for free. Recalls are scheduled to begin July 7. Any questions can be directed to Cummins customer service at 800-343-7357. The NHTSA campaign number for this recall is 16E-047.

 

 

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