Hours of Service reform could cause problems for Owner-operators, by cutting the freight rates
Hours of service reforms could “rip the rug out from underneath” small carriers, says Jeff Tucker, CEO of Tucker Company Worldwide.
Hours of service reforms proposed by the U.S. DOT in August intend to provide drivers with flexibility around managing their duty day, particularly the rigidity of the 14-hour clock. But that added flexibility could tilt the supply-demand forces in the industry and cause rates to tumble. According to Jaillet.
That’s the warning of Jeff Tucker, owner, and CEO of the brokerage Tucker Company Worldwide. He foresees the proposed reforms as harmful to owner-operators and small fleets and as a win for shippers and large carriers.
“It is unquestionable that we’ll have injected capacity into the market,” says Tucker. Added flexibility would, in effect, allow longer workdays by allowing truckers to go off-duty during detention time, to avoid traffic and more, thereby creating market capacity. “When you increase capacity, especially in a soft market [like the current market], we all pay in terms of lower revenues.”
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Story by: James Jaillet @ Overdriveonline.com
Source and credits: overdriveonline.com / James Jaillet /iTrucker / Mario Pawlowski