Growing use of third-party logistics providers (3PLs) is damaging, and even destroying, shipper/carrier partnerships and may be jeopardizing hazmat transport safety, according to John Conley, vice-president of National Tank Truck Carriers. He called on the Research and Special Programs Administration to take a closer look at the way 3PLs work with hazardous materials shipments.
“Some of the partnerships developed by shippers and their carriers are being diluted by the use of 3PLs that simply match loads with carriers based on availability and price, or the rate reduction obsession within traffic departments,” Conley said. “We applaud any efforts by RSPA to regulate the hazardous materials activities of 3PLs. In too much of the chemical industry today, carrier selection and compensation resemble a gladiator contest in ancient Rome. The shipper throws his business—perhaps on a CD—into the ring and watches as the carrier combatants slash each other for a share of the spoils. Lowest rate standing at the end of the contest wins.”
Conley was one of the speakers August 22 at the Hazardous Materials Transportation Conference in New Orleans LA. The inter-industry workshop was coordinated by Dennis Ashworth with Chevron Phillips Chemical Co and was sponsored by Chevron Phillips, the Transportation Research Board, Department of Transportation’s Research and Special Programs Administration, American Chemistry Council, Burlington Northern Santa Fe Railway, and Kirby Inland Marine.
Conley pointed out that shipper/carrier partnerships pay off in a number of ways, especially in the area of safety. Working together, shippers and carriers can do a much more effective job of reducing the risk encountered in the hazardous materials transport process.
Effective risk management in the tank truck industry today has three key elements—regulatory compliance; well-trained, experienced drivers and employees; and effective communications with shippers and consignees. Unfortunately, some of these elements are in danger of being compromised, Conley said.
On the regulatory side, Conley said the tank truck industry is concerned that the Department of Transportation may be backing away from its strong role in regulating the entire hazmat transportation process. “If transportation is viewed as simply occurring from ‘gate to gate,’ we will soon learn all too well that uncertainty and inconsistencies in regulation and jurisdiction within the plant gates will lead to incidents on the road,” he said. “We urge DOT to continue its stewardship over the entire transportation process.”
Drivers pose a special concern because they are so closely involved with hazmat shipments. “Any safety director will tell you that there is really not a shortage of people who want to drive trucks,” Conley said. “But there is a significant shortage of drivers we feel confident to hire to drive our equipment carrying your product. When we do find the good drivers, we can’t pay them enough.”
Turning to effective communications with shippers and consignees, Conley pointed out information sharing is essential to safe transport. “The more information we can provide each other about the entire transportation transaction, the better we can manage risks associated with the distribution of chemicals,” he said.
Good communication has been one of the casualties of the seemingly endless waves of downsizing and reorganization that is occurring in many industries. The people who are most knowledgeable about tank truck transport of chemicals are gone from many chemical companies. Communication also is lost when the chemical companies outsource their transportation management to 3PLs that lack a hazardous materials focus.