Thousands of CDLs at risk — how will fleets handle the fallout?

Are carriers ready for the expected wave of CDL downgrades? With new rules kicking in, thousands of truckers are about to lose their CDLs and many fleets might not see it coming.

Plus, we are rolling out our new spotlight section today, featuring an interview with a trucking CEO who shares his go-to investments and tools that make a big difference for his business. Do you have an interesting story to share about your trucking business? We'd love to hear from you — just reply to this email.

Today's Lineup
🔷 178K CDLs may be downgraded
🔷 LTL carrier celebrates its 100th birthday
🔷 Non-operating fleet slapped with $141.5M jury verdict
🔷 Meet the next generation of trucking professionals
🔷 Port strike part 2? Dockworker negotiations have stalled

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 ⬇️3.491

AVG. COST OF DIESEL PER GALLON IN U.S. AS OF 11/18, DOWN -0.03¢

Source: U.S. Energy Information Administration

'We tapped into a group of like-minded trucking companies that sought to be best in class'

Back in 1975, two Georgia-based trucking companies separately hauled their first-ever freight — one carried tobacco, the other a load of chicken. As they grew individually, the two companies realized that joining forces would benefit their businesses, employees and customers. They merged in 2023 and aptly named the company The 1975 Transportation Group, working today with shippers in manufacturing and food processing.

We caught up with the firm's president and CEO, Brett Phillips, to hear his story and top tips for the industry.

How did you get into the trucking industry?

I was in public accounting and helped a prospective client negotiate the purchase of a trucking company back in 2004. For the next 10 years, I served as the business's financial advisor in an outside CFO role. The owner made me an offer to join the company in 2014 as the CFO. I accepted the offer and was promoted to CEO in a few years. I eventually bought the company and have been in the trucking industry ever since.

 What's the best investment you've made in your business?

The best investment we have made as a trucking business is joining a Cottingham & Butler captive insurance group about five years ago. We tapped into a group of like-minded trucking companies that sought to be best in class with respect to safety culture, programs, and technology. In addition, we have enjoyed the benefits of a professional claims management process in which our voices and opinions matter.

In a difficult insurance environment facing rising premiums and runaway claims, we have been able to achieve stable premiums, earn returns of premiums in the form of dividends, and build a great safety culture that is supported by our operations team and executive leadership. 

 What's one tech tool or app you can't live without?

A comprehensive Transportation Management System (TMS). There are many add-ons to the TMS that enhance its operational value, such as EDI and telematics integration, but having the right TMS is foundational.

The first initiative I started when I became a CFO in trucking in 2014 was the implementation of McLeod Loadmaster TMS. It truly transformed our business and allowed us to grow our fleet and revenue without having to add operational supporting personnel. 

 Above, from left: Phillip Taylor, Brett Phillips and Steadman Taylor of 1975's executive team. (Courtesy of The 1975 Trucking Group)

As CDL downgrades begin, are carriers blindsided?

The Federal Motor Carrier Safety Administration’s Drug and Alcohol Clearinghouse has been around for years, but a new rule took effect this week. State driver licensing agencies must now downgrade CDLs if truckers fail a drug or alcohol test.

 Carriers are supposed to query the Clearinghouse for violations, but Brandon Wiseman, president of Trucksafe Consulting, says many fleets haven't been doing that.

 "It's just crazy to me how many carriers still don't even know about it, let alone use it," Wiseman says, referring to the Clearinghouse.

Why this matters: Carriers who haven't checked the Clearinghouse may have worked with drivers in prohibited status. An estimated 178,000 truck drivers were in violation, and set to have their CDLs downgraded. (Commercial Carrier Journal)

• MILESTONE BIRTHDAY: LTL carrier Saia marks 100 years in business
• LOAN FRAUD: Truck owner pled guilty to wire fraud for six-figure loan
• NUCLEAR VERDICT: Damages of $141.5M against fleet no longer in business
• INFLUENTIAL WOMEN: Tracy Rushing of RE Garrison wins award

Meet the next generation of trucking professionals

"An opportunity to go learn more about the industry was something I couldn't pass up. It's kind of the backbone of our country." - Herman Meyer, Western Washington University

Meyer is one of 18 college students participating in Trucking U, the American Trucking Associations' program of education, networking events and mentorship in the trucking field. Despite some industry doom and gloom, plenty of students are excited to learn about and join the profession! Check out the video here.

Port worker negotiations on labor contract grind to a halt

After last month's three-day strike at the East and Gulf Coast ports, dockworkers and their employers went back to the bargaining table. But talks are at a standstill once again. The sticking point: automation. 

Why this matters: If the two parties don't reach an agreement, dockworkers could strike again in January, impacting drayage carriers and freight movement near the ports and beyond. (The Loadstar)

Capacity in trucking is getting closer to equilibrium

Trucking is still overcapacity, but less so. According to J.B. Hunt CEO Shelley Simpson, overcapacity has dropped from 30% to about 10%. She estimates the market could normalize by Q3 of next year. 

Why this matters: Too much capacity, much of which entered the market from 2020 to 2022, has kept trucking rates low in a long freight recession. Falling capacity is a sign that trucking exits are continuing, and rates may start to rise. (Trucking Dive)

NY trucking group fights back on congestion pricing plan

As New York's governor renewed plans to implement congestion pricing, the Trucking Association of New York pushed back. President Kendra Hems called out "the disproportionate pricing structure," in which trucks would pay higher fees than cars when driving in parts of New York City.

Why this matters: If congestion pricing takes effect early next year, fleets may need to alter routes, change hours or raise rates to offset higher costs. (Truckers News)

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The Inside Lane is curated and written by Shefali Kapadia and edited by Bianca Prieto.