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What SMBs Need to Know About Electronic Logging Devices

Sean Peek
Sean Peek
business.com Contributing Writer
Updated Nov 12, 2021

If you operate a small fleet, you may be required to adhere to new regulations.

The trucking and logistics industry is huge. More than 50 million tons of freight are transported every day through the U.S. transit systems, making up a significant portion of the annual GDP. 

To better regulate this large industry, reduce fraud and improve the safety of America’s roads, the Federal Motor Carrier Safety Administration (FMCSA) instituted the electronic logging device (ELD) mandate, which requires all commercial trucks to have an onboard device that connects to the vehicle’s computer. If you run a fleet of vehicles as part of your small business, it’s important to be aware of this regulation.

What is an ELD?

An ELD is a piece of hardware installed in a truck to track vehicle activity. These devices make sure that your drivers are complying with hours of service (HoS) regulations for driving limits in a 24-hour period and the appropriate number of breaks. Major telematics companies provide ELD installation and support to trucking companies. While ELDs were slowly implemented into the industry, they are now a federal requirement. 

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What does an ELD do?

An ELD electronically reports when a vehicle is on, idle and in motion. It holds drivers and trucking companies accountable to the HoS regulations set out by the FMCSA. HoS regulations require drivers to log driving, break and on-duty time. They’ve been around for a while, but in the past, trucking companies and drivers used paper logs to track this time. 

This left considerable room for tampering and adjustment by the driver or trucking company. An ELD cannot be tampered with because it’s connected to the vehicle. This provides transparency between drivers, trucking companies and the government. It also ensures that safety remains a priority.

If you have an ELD, or work with a company that claims to provide ELDs, you can check this list of registered devices to ensure you comply.

TipTip: Interested in choosing a telematics solution for your business? Check out our reviews of the best GPS fleet tracking software.

Who uses ELDs?

Most trucking companies and drivers are subject to the new ELD mandate. If you’re transporting goods by truck in state or across state lines, you will likely have to comply with the new rules.

There are a few exceptions to the ELD mandate that could apply to some small businesses:

  • Drivers who use paper logs no more than eight days in any given 30-day period
  • Driveaway-towaway drivers
  • Owners of motor homes or recreational vehicle trailers
  • Drivers of vehicles manufactured before model year 2000

Keep in mind that this applies only to commercial transportation companies that are required to maintain HoS records. If your business handles deliveries but your drivers don’t use paper logs to track driving activity, then these new rules don’t affect you.

Benefits of an electronic logging device

Whenever industries are required to adopt new technology, especially when the tech is designed to drive compliance and accountability, it’s natural for business owners to resist adopting new systems. ELDs are no different. Since they were first announced in 2019, the trucking industry has pushed back against ELDs, with rallies and protests across the country.

Even though the ELD mandate had a mixed response, ELDs provide many benefits for both carriers and commercial truck drivers. Here are some of those benefits:

1. Truckers spend less time on paperwork.

One of the primary benefits of an ELD is that it eliminates a significant portion of the paperwork involved with a driver’s record of duty status (RODS), which must be completed each 24-hour period. According to the FMCSA’s Preliminary Regulatory Evaluation of Electronic Logging Devices, drivers will save approximately 4.5 minutes from logging their HoS each day – which may not sound like a lot, but the time quickly adds up.

For example, if a driver completes 240 RODS reports a year and saves 4.5 minutes logging information each time, they will gain back 18 hours a year. Therefore, if the average driver earns $28 per hour, trucking companies could potentially save $504 a year per driver. With over 3.6 million employed truck drivers in America, the trucking industry is saving approximately $1.7 billion each year through ELDs.

2. ELDs digitize driver vehicle inspection reports.

Before a truck can start a new trip, the FMCSA requires drivers to record the roadworthiness of their vehicles by going over a checklist, which has the driver record the odometer reading, check for fluid leaks, test the brakes, etc. With an ELD, a driver can perform this inspection checklist from the cab with a tablet and upload it to the cloud.

This efficiency has other benefits as well, as electronic driver vehicle inspection reports ensure nothing is missed, information is recorded accurately and company headquarters receive the reports immediately.

3. They monitor driver behavior and safety.

Because an ELD is connected to the vehicle’s engine and computer, it can monitor an individual’s driving behavior, including speed patterns, sudden maneuvers, heavy braking and excessive idling. An ELD can also measure how efficiently each driver uses fuel, which is one of the biggest costs of any trucking fleet. Therefore, this device can increase not only the safety of your drivers, but also your company’s overall fuel efficiency.

Did you know?Did you know? Keeping accurate records of when a truck is in motion and when it is idle can help your fleet optimize its fuel consumption, which can have a significantly positive impact on your bottom line.

4. They automatically create International Fuel Tax Agreement reports.

If your company operates in several states, you’re required to file quarterly fuel tax reports in each state to comply with the International Fuel Tax Agreement. In the past, these reports were tracked and filed manually, but with an ELD installed in each truck, the fuel data is automatically captured and reported. This saves both truck drivers and office employees time.

Costs of an electronic logging device

According to the FMCSA, the average cost of an ELD is $495 per truck. The exact price depends on the size of your fleet, the specific features you require and the provider you choose. If you already work with an ELD-compliant fleet management system, you may not have to invest in a new system.

While $495 per truck is a significant investment for an entire fleet, the money you save automating driver and back-office paperwork more than makes up for this expense. Keep in mind that there is often a software component to ELDs that may require monthly or yearly subscription fees with a telematics company. By bundling your ELD usage with other marquee telematics features, you can get the most out of your fleet. 

FYIFYI: ELD violations can lead to fines up to $10,000.

What is the ELD mandate?

The ELD mandate requires drivers and freight companies to electronically log HoS in compliance with FMCSA guidelines. Implementing these regulations allows the government to track data on how companies treat their fleets and drivers. In years past, this information was logged by hand, which provided opportunity for inaccurate data collection. By implementing the ELD mandate, the FMCSA is holding drivers and companies accountable for hours worked and total miles driven, which can create safer roadways. 

Who’s affected by the ELD mandate?

The ELD mandate applies to all drivers and owner-operators who are required to keep RODS reports. These require drivers to complete a checklist during their driving shift. This checklist includes these data points: 

  • The time the driver reports for duty each day
  • The total number of hours the driver is on duty each day
  • The time the driver is released from duty each day
  • The total duty time of the driver for the previous seven days 

You and your drivers must keep RODS reports if you meet the following qualifications

  • Your vehicle is 10,001 pounds or more.
  • Your vehicle has a gross vehicle weight rating or gross combination weight rating of 10,001 pounds or more.
  • Your vehicle is designed or used to transport 16 or more passengers (including the driver) not for compensation.
  • Your vehicle is designed or used to transport nine or more passengers (including the driver) for compensation.
  • Your vehicle is transporting hazardous materials in a quantity requiring placards.

What are the penalties for a violation?

If you continue to use paper logs, have used an automatic onboard recording device after Dec. 16, or fail to purchase and install enough ELDs for your fleet, you could be subject to penalties. Violations usually impact your Safety Measurement System score, which is a grade the FMCSA uses to regulate safety among trucking companies nationwide. You may also be subject to fines ranging from $1,000 to $10,000, depending on the incident.

How do you get started with ELDs?

The FMCSA has a variety of resources on its website detailing how to purchase ELDs and train drivers to use them. Finding an FMCSA-approved device is the first step in compliance. 

You can also partner with a telematics company that ensures ELD compliance and provides various other fleet tracking services, like fuel management, driver safety performance data and route optimization. The ELD mandate will bring technology into every commercial truck on the road, opening the door for more data and more informed fleet decisions.

Matt D’Angelo contributed to the writing and research in this article.

Image Credit:

welcomia/Shutterstock

Sean Peek
Sean Peek
business.com Contributing Writer
Sean Peek has written more than 100 B2B-focused articles on various subjects including business technology, marketing and business finance. In addition to researching trends, reviewing products and writing articles that help small business owners, Sean runs a content marketing agency that creates high-quality editorial content for both B2B and B2C businesses.