Keep up to date on industry news with our roundup of topics that could impact you and your business.
What Are The Major Changes Impacting Today’s Logistics1
- A shift in economic and industry fundamentals
Recently, the U.S. economy has been flush with reforms geared towards helping to drive demand and an increase in consumer confidence, leading to more U.S. manufacturing. This, in turn, has created an increase in freight demand which has led to a crippling driver shortage, which is progressively stressing industry capacity causing a jump in transportation costs and a fall in margins, even for the largest nationwide companies.
- The rise of the “Amazon” effect
Because Amazon has expanded so far so fast, it has created a new standard of consumer shipping expectations. “The effect of Amazon is heightened expectations,” says C. John Langley, a clinical professor of supply chain management and the director of development for the Center for Supply Chain Research at Penn State’s Smeal College of Business. “Next week is no longer good enough. It’s got to be on its way now and arrive at destination within a day or two,” he adds.
- Advances in frontline and backend technologies
While the technology to fully autonomous transportation and delivery are still some ways away from taking over the logistics industry, there are plenty of safety tech that is already having a significant impact on the industry as a whole. Such frontline safety technologies include lane departure warnings, forward-looking cameras and radar, alerts for drivers when objects are in blind spots, adaptive cruise control, and rollover stability. In addition to all these frontline tech options, there are just as many behind-the-scenes technological advances readily available. Tools like artificial intelligence, machine learning, blockchain, and IoT/telematics have competitive potential for companies that choose to utilize them early.
Entry-Level Driver Training Compliance Date Extension2
FMCSA has announced that it is modifying its December 8, 2016, ELDT final rule, “Minimum Training Requirements for Entry-Level Commercial Motor Vehicle Operators”. The rule change will extend the compliance date for Entry-Level Driver Training. FMCSA has extended the compliance date by a full two years, from February 7, 2020, to February 7, 2022 providing them with more time to finish developing the Training Provider Registry (TPR).
Developing the TPR has taken longer than anticipated but is a crucial factor for the FMCSA because it will help streamline the entire process. The TPR is designed to allow training providers to self-certify that they meet the training requirements, provide the electronic interface that will receive and store ELDT certification information from training providers, and transmit that information to the State Driver Licensing Agencies (SDLAs).
FMCSA Reduce Commercial Vehicle Registration Fees3
On February 12, 2020 the Federal Motor Carrier Safety Administration announced the final rule that continues to reduce commercial vehicle registration fees in 2020 and 2021. The 2020 and 20201 annual registration fees collected by states for motor carriers, private motor carriers of property, brokers, freight forwarders, and leasing companies has been reduced by 14.45% below the 2018 registration level. It is important to note that the rates are calculated based on the number of trucks a carrier has in its fleet. The final rule stipulates that the fees will remain at this level through 2021, and beyond that unless amended again in the future.
With so many economic uncertainties, policy changes, and technological advances, it’s no wonder the logistics industry is experiencing such a high level of disruption. But what are the major changing forces affecting the logistics and transportation industry today? According to Forbes Insights research, there are three primary disrupting factors:
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Sources:
1 https://www.forbes.com/sites/insights-penske/2018/09/04/the-4-forces-transforming-logistics-supply-chain-and-transportation-today/#380841acb752
2 https://www.fmcsa.dot.gov/newsroom/extension-compliance-date-entry-level-driver-training-0
3 https://www.ttnews.com/articles/fmcsa-final-rule-calls-reduced-commercial-vehicle-registration-fees
