Driver Hour Efficiency is the new metric of fleet operational efficiency and Trailer Fleet Investment is the best use of capital to improve it.
With the advent of a system wide implementation of ELD, the entire trucking transportation network is chasing more refinements to Driver Hour Utilization (DHU). It is not enough to focus on Trucks and Drivers, but the compounding factor of time is now more crucial than ever to profitability and success. In this market it is quite possible to grow revenue right into red ink.
“We use our trailer count to recruit. More pick and drop, more loaded trailer pick-ups and more efficient transitions. All are factors that we discuss with potential associates,” David Patrino, Manager Jacko Logistics. Trailers cost less to acquire, operate and manage than drivers. They retain value better than tractors and they are warehousing space in most of the markets you haul in. By increasing trailer count with a measured plan, your DHU can increase.
Private Fleets have the most flexibility because they have a bit more influence on inventory. Increased trailer count is also available space. When a major electronic retailer purchases 10,000 trailers – they add 4.5 million square feet of warehouse space.
It made sense in previous markets to reduce trailer count to improve ratios and trailer utilization. In this new environment this must be balanced with Driver Hour Utilization. Chasing a ratio on the balance sheet doesn’t function well with a driver at the truck stop with 100 miles to go and 1 hour left before his restart.
In his work entitled “Improving Fleet Utilization,” Joseph Evangelist noted the first thing in equipment utilization is “…driver’s available hours of service.” I would suggest this is now inverted – the question to ask when improving Driver Hour Utilization is available loaded trailers.
Trailers are the least expensive capital investment to operate, have a flatter value drop and can add, along with operational planning, an improvement in Driver Hour Utilization.
Dan Brown is the Managing Director for Coast Hyundai Trailers in Portland OR. He has worked for Daimler and large Dealership Groups for the last 20 years. He has served as a fleet consulting and has MBA from Marylhurst University – Please contact him at firstname.lastname@example.org