Drayage and the entire supply chain industry are poised to enter an exciting new era fueled by digitization. A future of faster, cost-effective, improved efficiency is well within sight yet, many questions need addressing. We sat down with Weston LaBar, CEO of the Harbor Trucking Association, to get his straightforward answers to the questions those with a vested interest in drayage should be asking.
What are three changes the drayage industry needs to be more efficient?
First, the adoption of technology to allow complete system connectivity between supply chain stakeholders. Second, the integration of technology to maximize data collection and sharing without overloading old systems. Sharing of data will enable the entire ecosystem to become more predictive—preventing problems before they occur. Third, the infusion of artificial intelligence (AI) to further drive more intelligent and predictive action.
Where and how will technology help the most?
Technology’s impact will come from the ability to collect, standardize, and share data. The importance of data sharing can’t be stressed enough—it will help create the end to end visibility that’s currently lacking in the industry.
Weston puts the irony in perspective, “If I know when someone is putting pepperoni on my pizza, and exactly the moment it will show up at my door, how can companies not know the whereabouts of their container with a half million dollars worth of goods?”
We all have heard about trucks driving themselves. What will be the role of automation in drayage? Do drayage carriers need to worry about their jobs?
Automation’s role in drayage appears limited—at least for now. Long haul routes are far better suited to automation, but even here commercialized driverless options are more than a decade away. Also, many future variations of vehicle automation will still require a driver present in the cab, so drayage drivers needn’t worry about job loss due to automation any time soon.
Life for drayage drivers isn’t easy—from strict ELD mandate enforcement to excessively crowded and congested ports it’s a daily struggle. Many drivers are leaving the industry. How can we curb this trend and make drayage trucking more appealing as a career?
Regrettably, the drayage industry is laden with inefficiency that bog drivers down and curbs potential earning power. When drivers sit in congested ports, they lose money. When drivers have to wait for chassis to become available, and can only squeeze in two trips instead of three, they lose money.
The industry needs to become more operationally efficient to allow drivers to do more driving and less waiting. Weston explains, “The biggest thing a trucker wants to do is get in their truck and drive. They don’t want to get in their truck and wait. As an industry, the easier we make it for them to maximize driving and minimize waiting, they will make more money, be happier, and continue to grow in their career.”
As an industry, what can we do to help truckers maximize their Hours of Service (HOS)?
With the traditional appointment system in today’s congested ports, many drivers get stuck waiting and fail to maximize their HOS. A more efficient hub and spoke “shuttle model” will shorten the travel distance for drivers. Shorter, more frequent runs will mean more valuable work hours moving freight rather than waiting for appointments. A shuttle model will help maximize HOS for carriers, move more freight, and increase the fluidity of the entire drayage ecosystem.
What can truckers do today to help their bottom lines?
In a word—incorporate. Carriers who work under corporate structure enjoy many financial perks. In addition to the tax breaks, these drivers enjoy complete autonomy in pursuing employment.
Unlike drivers who receive a 1099 and must work a minimum of 120 days a year for one company under Federal regulations, those who incorporate are free to haul for the busiest shippers. Rather than being at the mercy of mandated commitments, incorporated drivers can stay busy following the work.
Fees for street turns unjustly punish carriers for efficiency. Is there any way around these unfair penalties?
Unfortunately not at this moment. As vastly misplaced as this cash grab is by ocean carriers, truckers will continue to feel the financial bite of added fees for their practicality.
What can be done to help ease the current chassis shortage?
Moving to a trucker choice model seems to be the best solution. The current system of equipment pools is antiquated and broken. It’s time to get the ocean carriers out of the chassis business and for truckers to shoulder this responsibility. Whether truckers buy or lease, they will be serviced 100% of the time when they supply the equipment.
How will the drayage industry evolve in the next five years?
The trend is shifting away from local and regional market emphasis toward a more national scope. The industry will continue to see consolidation with large national carriers looking to acquire strategic markets.
There will also be a significant push toward technology, especially as a younger generation of operators come of age. Technology will increase stakeholder connectivity, sharing of valuable data, visibility, and efficiency throughout the drayage ecosystem.
Weston injects humor when he explains the Harbor Trucking Association’s view.
“We don’t support a no trucker left behind stance. We will advocate rewarding the rapid adopters, push for the best technology, and leave those who can’t or won’t change.”
Which technologies will have the most significant impact on drayage?
There will be a movement toward private LTE networks to advance connectivity between stakeholders. The days of marine terminals being black holes will mercifully end. The adoption of API integrations will allow operating systems to speak to each other—increasing data sharing and visibility for shippers.
The real excitement originates from the possibilities created by the infusion of artificial intelligence (AI) and machine learning (ML). These technologies will allow the drayage industry to become far more predictive—proactively identifying and addressing problems before they occur.
What can shippers do to better prepare for the future?
Shippers can become better educated on how their procurement contracts impact logistics and overall supply chain proficiency. What may appear to be the best deal may end up costing far more in the end.
Weston explains, “When I ask shippers how much their free chassis costs, I often get sideways looks, but then I mention the demurrage fees when they get stuck during an episode or peak season.”
Shippers also need to scrap the “cheapest trucker is the best trucker” mindset. Everyone likes a bargain, but it’s crucial to view your carrier in light of a long term partnership. Do they bring the reliability, consistency, visibility, and technology to be a top-notch partner over time?
What can truckers do to better prepare for the future?
Embrace technology, embrace technology, and, did I mention embrace technology? Yes, it’s that important. Drayage is entering the digital age—early investors in technology can anticipate long term success, while those that blindly cling to outdated practices face a bleak future.
Weston aptly sums it up, “Those drivers that cling to legacy systems won’t be capable of providing the advanced metrics and data that shippers want. Larger shippers want more data, and if you’re not capable of generating this data, you will struggle to get these contracts and, ultimately, stay in business.”