Q4 Industry Insights

Recently, the Federal Motor Carrier Safety Administration (FMCSA) updated the mandate of the hours of service (HOS) regulations which went into effect September 29, 2020.

 

These rule changes are already helping shipments move more efficiently. Here’s what your need to know about the updates and how they could impact shipping:

  • 30-MINUTE BREAK REQUIREMENT: Drivers can now take a 30-minute break during their 8-hour driving times through an “on-duty, not-driving” status rather than an “off-duty” status.
  • SLEEPER BERTH PROVISION: Drivers have two options for splitting their 10 off-duty hours — 8 hours in the sleeper berth and 2 hours off-duty, or 7 hours in the sleeper berth and 3 hours off-duty.
  • ADVERSE DRIVING CONDITIONS EXCEPTION: This exception maximizes driver safety by allowing another two hours on top of the two additional hours while facing dangerous road conditions like snow or flooding.
  • SHORT-HAUL EXCEPTION: This extends the short-haul exception to 150 air-miles and allows a 14-hour work shift that may occur as part of the exception.

 

So, what does this mean for shippers? In the big picture, the increased flexibility for drivers will mean a smoother shipping process altogether. These HOS rule updates will make more drivers available for longer periods of time, decreasing freight capacity shortages.

 

What can the freight industry expect to see in Q4?

 

Grocery stores and retailers have begun stockpiling groceries in preparation for a possible “second wave” COVID-19 cases this winter season. The fear of another COVID surge is creating a lot of doubt about the holiday retail season, a time that historically sees higher demand for truckers to haul freight.

Manufacturers are also working to stockpile inventory in an effort to avoid the kind of shortages seen in March this year at the beginning of the pandemic. DAT Freight & Analytics statistics show that “American consumers increased shopping by 33% over the course of this year, with nearly two-thirds mentioning that most of their shopping is done online due to the pandemic.”

E-commerce shipping logistics company released a national ShipStation consumer study detailing consumer buying tendencies and the impact the pandemic has had on freight, “The COVID-19 pandemic has largely been a positive for e-commerce companies, as people turned to buying online when cities shut down.”

Freight capacity and rates were already at elevated levels leading into the holiday season amid a possible resurgence of COVID-19 cases. Dean Croke, principal analyst for DAT iQ, the freight data and analytics operation for DAT Freight & Analytics, expects the increased e-commerce freight to put final mile shipping in high demand.

“E-commerce is expected to be at record-high levels during the holidays and retailers are restocking their inventories, especially those coming from international suppliers that had seen difficulty making regular deliveries early on during lockdown,” according to the report for the index. “Logistics services are in higher demand as consumers rely more heavily on e-commerce due to the COVID-19 pandemic. The growth has been significant, with e-commerce up 44% as a percentage of total retail in the U.S.”

It’s impossible to know how these new shopping and shipping trends will impact the overall long-term truckload market, but we do know that retail-related freight volumes are expected to remain high through year-end, while manufactured goods volumes are expected to slow.

 

We haven’t missed a beat. See for yourself why businesses are depending on Westgate to improve their shipping processes and to keep them informed of industry trends. REACH OUT to us to experience our boutique approach to streamlining logistics through an extensive network of resources, trained brokerage experts and unique personal service.

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