The new wave in cargo count

Federal Motor Carrier Safety Administration issued a supplemental notice of proposed rulemaking that would amend the agency’s rules of practice for motor carrier safety, hazardous materials and other enforcement proceedings. The rules would increase the efficiency of the procedures, accommodate recent programmatic changes and enhance due process and the awareness of the public and regulated community, FMCSA said. Comments are due Dec. 6. For a copy of the SNPRM, visit this site and search Docket No. 2299.

Michigan legislators are considering a bill that would increase the allowable length of tractor-trailers from 59 to 65 feet. The bill also would eliminate the court’s discretion in levying fines; the court would be able to assess civil fines only if it determined that a truck’s total weight or the load axle distribution exceeded legal limits. In Michigan, tractor-trailers carrying logs, pulpwood and tree-length poles already are allowed a 70-foot length on designated routes.

The U.S. Court of Appeals for the Eleventh Circuit recently agreed with the Owner-Operator Independent Drivers Association in litigation against Allied Holdings Inc. that owner-operator equipment leases with motor carriers are exempt from arbitration under the Federal Arbitration Act. The ruling upholds an earlier decision in March 2004 by the U.S. District Court for the Northern District of Georgia.

Q One of our major customers has asked us to accept computer-generated reports from an RFID system as evidence of its piece count for purposes of cargo loss claims. I do not fully understand this technology and do not understand whether this is a good idea. Should we agree to it?

A A radio frequency identification, or RFID, is an electronic scanning technology that, as increased use drives costs down, will allow more and more merchants to tag and track every item of inventory from production through to the end user. Wal-Mart and others are issuing mandates that their vendors move to this technology.

RFID uses a small electronic activation device affixed to an item to identify it in a number of ways, such as time and place of manufacture. Although RFID tags contain no batteries, they can transmit this information when activated by a scanner. This technology should eliminate any manual counting of inventory, reduce out-of-stock situations and save thousands of hours spent identifying products on hand or in storage.

Within a few years, I expect you will see RFID scanners installed on shipping and receiving docks throughout the country to read and identify items as quickly as they are loaded on or off a trailer – without even breaking the shrink wrap.

This technology could do wonders for eliminating miscounts that currently lead to carrier shortages because of purely human error. Yet, I am not sure I would be quick to surrender, based on RFID records, all recourse to dispute a claim. We know that to err is human, but by that same token, RFID technology isn’t infallible. Mis-scans can occur. For example, the signal reflected back from the tags on individual items might not be nearly as strong as the tags attached to the pallets and larger outside shipping units.

To the extent the industry appears to be heading toward the use of spotted trailers for loading and/or unloading, carriers are best served by insisting on shipper load and count service conditions with seals applied. However, if the shipper insists on abandoning this practice in favor of the RFID program, you should insist that seal integrity be maintained and that any shortage revealed by the RFID technology be noted on the bill of lading at time of delivery. That way you can be sure that all items can be re-scanned if something was inadvertently missed.