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Supply Chain News: Transportation News Round Up for April 2, 2018

 

Driver Pay is Up - but not Much; Bill would Change Hours of Service Rules; DHL Jumps Back into US Domestic Parcel Game - Sort Of

April 2, 2018
SCDigest Editorial Staff


Below is our selection of the top transportation stories of the past week.

ATA Study Says Driver Pay is Up – but not Much

The median level of annual pay (wages only) of US long truck drivers is now $53,000, according to the just released Driver Compensation Study from the American Trucking Associations.

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DHL's new Parcel Metro service is comprised of a network of local and regional delivery vendors and crowd-sourced drivers and vehicles designed for last-mile deliveries

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That is up about 15% over the last such study, conducted in 2013. The study was based on survey responses from more than 100,000 drivers.

The news for drivers at private fleets was even better, with annual wages jumping 18% to $86,000 per year.

Bob Costello, ATA chief economist, notes in the report that fleets were offering drivers signing bonuses and attractive benefits packages in an effort to recruit and retain them.

SCDigest will note that some larger carriers are clearly paying much more than the $53,000 annual wage level. Still, 15% growth over the 5 year horizon means average annual increases of less than 3% - hardly enough to stem the growing driver shortage, and in the face of some calls that driver pay needs to rise to more than $70,000 to have a real impact.

The problem: shippers don't want to pay the significant increase in rates such a market clearing wage would require.

The full study is available - for a charge - from the ATA.

Bill Introduced that would Change Hours of Service Rules

Rep. Brian Babin a member of the House Transportation and Infrastructure Committee, introduced the Responsible and Effective Standards for Truckers (REST) Act on March 29.

Babin says the legislation would "modernize hours of service regulations for truck drivers."

The bill calls for a single off-duty rest period that would not be counted toward the driver's 14-hour on-duty allowance. The rest period would also not extend the total, allowable drive limits.

However, drivers would still need to log ten consecutive hours off duty before the start of their next work shift. And the bill would eliminate the existing 30-minute rest break requirement.

The REST Act requires the Department of Transportation to update the Hours of Service regulations to allow a rest break once per 14-hour duty period for up to 3 consecutive hours as long as the driver is off-duty, effectively pausing the 14-hour clock.

At least one industry group is supportive of the measure.


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"We thank Rep. Babin for recognizing the need to address the lack of options for truckers trying to safely operate under today's overly rigid federal regulations," said Todd Spencer, acting CEO of the Owner Operator Independent Driver Association, adding that "We want to see improvements to highway safety and what we have right now isn't going to get that done."

No word as yet from the American Trucking Associations

DHL Back in US Domestic Parcel Delivery - Sort Of

It has been about nine years since German parcel carrier DHL, a unit of giant Deutsche Post, left the US domestic parcel market after buying Airborne Express and losing billions of dollars here, though it continued to support cross border deliveries.

But guess what: "They're back." DHL has just announced it is – what else – jumping on the ecommerce bandwagon for urban deliveries, though this is not quite the same as trying to again broadly compete with UPS and FexEx.

The company has released a same-day and next-day delivery service for online retailers, branded as Parcel Metro, comprised of a network of local and regional delivery vendors and crowd-sourced drivers and vehicles designed for last-mile deliveries. DHL has already started operating the service in Chicago, Los Angeles and New York, and plans to expand to Atlanta and Dallas in the second quarter, San Francisco in the third, and Washington, D.C., later this year.

DHL says its software platform allows it to find the best drivers for each route. Customers can choose from several delivery time windows, including two-hour, same day and next day, as well as their preferred delivery address. Retailers can also customize the mobile interface with their own branding.

According to Jerry Hemsptead, a former DHL executive and now consultant in the parcel sector, not to SCDigest that the "new" DHL service is not all that new.

 

"Same day delivery has existed in major markets since I started in the business over 40 years ago," Hempstead told us." The market was dominated by messenger companies like Quick, Eastern Connection, and a few others."


He added thah Fedex has an offering called SameDay Inner City serving over 30 markets, while cities such as New York, Washington DC, Chicago, Philadelphia, and Boston have always had bike messengers and couriers that had sacks and traveled on the subway to make deliveries.


But, Hempstead says, "What is interesting here is that the remnant of Airborne Express that was called @home is the cornerstone of DHL ecommerce which is promoting this "new" service. It's an extension of fulfillment of ecommerce orders to provide speedier delivery. Something being heralded by Amazon for a long time."


He added that "The sooner a consumer is gratified, the sooner their next order; the quicker the consumer gets an order the greater the likelihood of the next order, etc."


Hemstead also told SCDigest that "It’s interesting that DHL has done this at the same time UberRush announced it is closing down. Other start ups in this space have also shuttered in the last year, such Doorman and Shyp."


He also said to keep in mind this is not an offering from DHL Express, the unit that abandoned the domestic market in January of 2009 and is loath to return to it, as it contunues to focus on the transport of international shipments.

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