ELD rollout will lead to “substantial deterioration”: FTR
BLOOMINGTON, IN — American transportation consultants FTR Associates is forecasting “steadily-deteriorating conditions for shippers through 2017, as capacity tightens in reaction to stronger demand and the Electronic Logging Device (ELD) mandate.” In a news release this morning, FTR’s partner and senior consultant Larry Gross says the mandate for ELDs in December will cause “substantial deterioration.” The year 2017 will be a year of upside risks to truckload rates because of a tightened market, possible oil price inflation, and the chance of general inflation.
Gross’s comments came as FTR released the latest Shippers Conditions Index (SCI), a compilation of factors affecting the shippers’ transport environment.
January’s SCI improved slightly compared November to a reading of 1.4. However, this reading does not promise a positive outlook for shippers in 2017.
Any reading below zero indicates a less-than-ideal environment for shippers. Readings below -10 signal conditions for shippers are approaching critical levels, based on available capacity and expected costs.
Here’s FTR’s Gross on the matter: “Although many shippers are saying, ‘We will believe it when we see it,’ our thesis that truck capacity will tighten significantly over the course of 2017 remains intact. Some may believe that the course of this mainly regulatory-driven event will be altered by the Trump administration, but our expectation is that the key change, namely the mandate for ELDs, will take effect in December as planned. This will cause substantial deterioration in the SI over the course of this year. While the pace and even the magnitude of the deterioration is still somewhat uncertain, shippers would be wise to lay in contingency plans for dealing with this significant event.”