Trucking is in for a busy 2017.
Trucking is in for a busy 2017.

With the close of January beginning to come into focus, it’s a pertinent time for trucking and logistics companies to take stock of how they’ve performed in the first month of 2017 and refine any processes that could make the next 11 months a bit smoother. For companies that have already run into trouble this year, whether it be with compliance, technology or staffing, among others, the remainder of the year could represent a significant hurdle. That’s because of the vast number of changes that trucking is primed to undergo over the course of 2017, some of which are already planned for, while others are still being tallied in the “uncertain” column.

Let’s comb through some of the obstacles that may lie ahead for trucking companies and identify avenues for owners to make the most of them:

Automation takes a bigger piece of the pie
The rate at which the trucking industry has been impacted by technology rapidly increases with each passing year: There’s no way around it. While personal computers, smartphones and even average vehicles seem to undergo dramatic technological overhauls fairly regularly, consumers have to come to expect these changes.

Commercial transportation on the other hand has remained largely the same since its inception, albeit with efficiency tweaks along the way. Let’s face it: Semi-trucks are massive machines that carry billions of dollars of cargo, making them ripe for innovation. Enter: automation.

Autonomous driving, truck platooning and digital analytics tracking are just a few of the ways that technology has arrived in the trucking space as of late. And these changes are occurring on a larger scale and at a faster pace, forcing fleets to update their own technology simply to stay competitive.

The issue in 2017, as noted by FleetOwner Magazine, is how trucking will onboard the many new tech opportunities in the face of staffing shortages and higher operating costs. Further, trucking companies are not inherently technology companies, yet the line between the two is quickly blurring.

Functions like route planning, data transmission, back-end accounting, dispatching and a host of other duties are now being automated. Yet, some companies don’t even know where to begin with automation, let alone understand how to leverage it for success.

To combat these frustrations and to better confront the 21st century economy, John Larkin, managing director of Stifel Capital Markets, advocates for “re-skilling” the American workforce, according to FleetOwner.

“We essentially need to stop suggesting that all citizens receive a college diploma while developing and providing an alternative educational path that equips a sufficient number of young people with the skills necessary to program a computerized machine tool, maintain a robotic welding machine, re-optimize and automated warehouse, operate a platoon of trucks, etc.,” said Larkin.

ELD compliance fast approaches
Full movement toward automation seems like a far-off concept, however. ELD, on the other hand, is quite immediate.

By December of this year, companies must comply with ELD regulations from the federal government, meaning any vehicles found to be in violation of the law will be taken off the road and the company fined.

Some larger fleets have been able to conquer their ELD fears and successfully onboard implementation strategies. Other smaller operations are having a tougher time meeting ELD mandate criteria while simultaneously holding the line on their margins. The long-term payoff of making the move toward electronic record-keeping is self-evident, but for an owner-operator on a shoestring budget, there simply isn’t a margin for error when the devices themselves are costly to purchase, install, integrate, maintain and enhance.

Taking the plunge into the ELD world isn’t a question of when anymore, though. Implementation should begin here and now. Are companies prepared?

Federal regulations up in the air
The ELD mandate is hardly the only regulation on the mind of fleet owners and managers. With the election of Donald Trump and a Republican majority in both chambers of Congress, a bevy of transportation policies may be altered or scrapped. So how is a fleet supposed to prepare accordingly?

The Wall Street Journal reported a number of trade groups from the rail, trucking and automobile industries are already formulating plans to lobby Congress to scale back regulations on safety requirements and hours of service mandates, which companies view as executive overreach and excessively burdensome.

The American Journal of Transportation discussed in a recent post the potential benefits that may be derived from a business-friendly administration with eyes set on fewer regulations. Many business owners are optimistic about the overall trajectory of the economy yet still feel they don’t have an adequate say in the formation of regulations that govern them.

Comprised in Trump’s potential proposal of higher infrastructure spending may be language necessitating a rollback of certain regulations affecting the transportation industry. Likewise, Trump signaled in his campaign a pledge to scrap two regulations for every new one introduced. The effect may be beneficial for some; on the whole, such a climate of what-ifs can create additional bottlenecks for fleets.

Without knowing what regulations they may be impacted by, which ones will be deleted or how many new ones may arrive, it can be difficult to plan ahead, which can be an added expense in and of itself.

Operating costs rising
More tech, higher fuel prices and projected tariffs on imported goods will mean trucking companies will face a minefield of expensive operating costs in 2017, at least relative to previous years. A reader poll conducted by Transport Topics concluded that nearly three-quarters (72.4 percent) of respondents believe gasoline will become more expensive in 2017.

Roughly three-fifths (58.6 percent) expect alterations to NAFTA as well. Such an adjustment could cause downwind expenses for companies of all sorts, causing them to rethink their cross-border shipping strategies.

Combined with higher interest rates, inflation and rising maintenance costs, trucking companies are in for a costly 2017. Luckily, most are seeing higher profit margins and more business, offsetting additional expenses.