Shipping Insight & Commentary from Jim LeRose

We see trucks zipping along the highway seemingly every minute of the day, and they continue far past our exit on the highway. While the average daily commute to work is 25 minutes, truck drivers spend a lot more time than that on the road. But just how long? Have you wondered why you are now seeing so many trucks in rest stops and pulled over on exit ramps? The reason is The Department of Transportation’s Federal Moral Carries Safety Administration (FMCSA) has decided to lower the maximum number of hours per week that a driver can be behind the wheel.

In a debate that has been lingering in the government since December 2010, when a proposal was made to the hours-of-service restrictions, weekly hours on the road have been cut down from 82 per week to 70. This marks the first change in the hours-of-service numbers since 2004. Also included in this updated agreement; drivers planning to work a stretch of eight hours in a row must first rest for 30 minutes, as well as take a 30 minute break in that time period whenever they deem it necessary. Lastly, a data analysis will be undertaken to determine if this is the appropriate amount of time on the road has been achieved, or if the number needs to be altered in any way. Once a driver hits these thresholds they must pull over or risk steep penalties and fines, for them and their employer or company they are hauling for.

This research occurs in large part due to the fight back for stricter limits to time on the road by trucking unions and associations. Politicians came to the conclusion that the overall weekly allowance of hours was enough of a safety measure to push this into law, a sentiment not agreed with by the truck associations themselves. It even led one CEO to say, “What’s surprising and new to us is that for the first time in the agency’s [ed note. FMCSA] history, FMCSA has chosen to eschew a stream of positive safety data and cave in to a vocal anti-truck minority and issue a rule that will have no positive impact on safety… Unfortunately, FMCSA twisted data and, as part of this final rule, is using unjustified casual estimates to justify unnecessary changes.”

The disagreement, boiled down, is between truck drivers concern for their safety coming up against the carriers desire to have their trailers arrive at their end point as soon as possible. While government hopes that they have reached a happy medium between the two, both sides are left wanting more decisions in their favor.

These fewer hours per driver, coupled with the upcoming forecasted driver shortage the result will be less supply in the market. Match less supply with a strengthening economy , more demand, and you have price increases.

When these forecasted price increases, and less supply, factors come into play, it will become more important than ever for shippers to have the ability to process shipments for a larger number of carriers. This is the Agile Network mission, allowing our customers to ship from as many carriers as they seem necessary. AgileShip has more than 7,500 carriers in our library, and we can add more as needed. So if you are feeling this pain, or expecting to, please contact us and see how we can help.

Most of us forget about our package once it is entered in the Agile system and picked up by all of the carriers that we use, and only other time we think about the package is when it is finally delivered or worse yet, when the package fails to arrive when promised. Thankfully, Agile has a resolution to take care of the packages that don’t arrive on time, and Agile Audit claims all errors on the part of the shipper. However, more often than not, the carriers deliver on their promise to get a package from point A to point B during the time that was agreed upon. But when a company like FedEx is responsible for shipping over 3.4 million packages shipped per day, how does a global shipper make sure there are not 3.4 million complaints?

With the numbers five, one seventy five, three hundred, and twelve thousand, that’s how. And with a little more insight, each of these numbers play an integral role in the shipment process.

Five – The magic happens at FedEx Super Hub, a five mile facility that is the heart of the FedEx operation. From here, the entirety of North American can be reached, as well as almost every global market in one flight in 24-48 hours.

One Seventy Five – At the super hub, there are one hundred seventy five parking spaces for aircrafts, which arrive during the day, unloads its packages to meander throughout the facility, picks up a new batch, and heads out on its way once the plane is full again.

Three Hundred – During all the meandering that a package does, it can traverse any part of three hundred miles of conveyer inside the facility. With so much inbound and outbound traffic, an endless maze is needed to receive the package, properly sort it, and send it on its way accordingly.

Twelve thousand – To oversee this monstrous production, the average day will see twelve thousand employees completing one task or another, all of which are important for the unit to continue to run smoothly. From pilots, mechanics, pickers, and packers, everyone has a job to do at a shipping hub.

This is just one example of the background work that goes into getting a package from here to there. Agile has partnerships with over five thousand shippers, all who’s goal is to deliver their package to you on time. While you have long forgot about the shipped package, there are many hard working people that still have its delivery as their top priority.

Yesterday, a trial date was set for the antitrust lawsuit that has been brought upon UPS and FedEx. AFMS LLC has brought a complaint to the courts on behalf of The Class that the two companies refuse to deal with independent and third-party consultation firms. In a hopeful turn of events for shippers, the complaint will be heard in court on June 18, 2013, if the date will please the court.

As a quick refresher, this case first started gaining steam during the summer of 2010, when AFMS accused UPS and FedEx working together to exclude the smaller third-party consultants from the marketplace. As stated, this would be a clear violation of antitrust law, more commonly known as competition law in Canada and across the globe.

The details of the complaint stems from a notice said to be circulated by both FedEx and UPS higher ups in which it demands new company policy in dealing with third parties. As it can be imagined, these new policies were not open to outside relationships, supposedly aiming to eliminate all business related conversations with any company looking for a piece of the pie.

The law firm representing AFMS, upon the agreement on a court date with UPS and FedEx, had some particularly biting words for the actions of the defendants. Blecher & Collins P.C. directly cite violations of the Sherman Antitrust Act, restricting trade and removing competition from the open market. Blecher also is looking for damages in the form of lost business. Blecher cites a 2006 survey by Morgan Stanley that 11% of shippers use third party consultation services.

UPS and FedEx are both eager to present their sides of the story in court. UPS presented the argument that it was perfectly in its right to avoid business with third parties, with the belief that it is in the best interest of its customers. FedEx, meanwhile, shoots down the argument that UPS and FedEx have unilateral agreements, citing both companies as competitors in an open market, and anything other than pure competition as baseless. Either way, this stands to be a monumental decision that looks to be on the horizon. Still 18 months away, both parties are preparing for war.

With issues like this, customers that employ an Agile solution have nothing to worry about. By using a multi carrier shipping solution, all shippers are equally and independently evaluated, and absolutely no foul play is involved. Instead of concerns of antitrust, Aglie customers can rest assured that all of their shipments are rated, labeled, traced, audited, and measured fairly, with absolutely no collusion concerns. This philosophy is the backbone of the Agile Network, and something we firmly believe in. To learn more about what the Agile Network stands for, please visit our website.