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September 2020

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26 | Overdrive | September 2020 B y summer's end, Alipio Montano was expected to be on his fourth electronic logging device provider in a little over two years. Montano, who runs two-truck CDR Transportation Services of Houston, opted for the One20 F-ELD before earnest enforcement of the U.S. Department of Transportation's ELD mandate began in April 2018. Marketed as a device for owner-oper- ators, the F-ELD was an offshoot of the now-defunct TruckThat app. But just months after the man- date took effect, One20 announced it was discontinuing service, giving Montano just 30 days to find a new provider. He switched to KeepTruckin for roughly a year. At the begin- ning of this year, he invested nearly $2,000 to outfit both trucks with Continental's VDO RoadLog system — the only product with a built-in log printer. Then VDO announced in April that it, too, would be dis- continuing service, leaving Montano once again searching for an ELD provider. "It not only costs a lot of time, it costs a lot of money," he said, to switch providers. "It's a big hassle. And then if I switch to another pro- vider, is it going to be the same story again — 'We're closing'?" Montano cited issues with log data retrieval and questions in compli- ance audits, should they arise, as key concerns in changing providers. Not to mention the lost investment. "I bought everything upfront — the subscription, the wires, the har- ness" and also a fleet card, since he employs a driver. Many other operators have faced similar problems of cost, inconve- nience and uncertainty as they're forced to quickly switch ELD provid- ers. That fate also appears to await other small fleets, too. Of the hundreds of ELD providers, many could lack the scale to compete profitably, especially in an economy still suffering from the COVID-19 pandemic. For marginal providers, it might not be worth the time and investment to update software and possibly hardware to be compliant with the new hours of service rule that takes effect Sept. 29. After the Federal Motor Carrier Safety Administration announced the ELD mandate in 2015, new providers flooded the market as the mandate's initial effective date of December 2017 approached. Now, with more than 400 device provid- ers and 500 devices listed in DOT's ELD registry, observers believe the market's headed for consolida- tion. That could mean mergers and acquisitions or ELD vendors simply throwing in the towel, perhaps with little warning. "The market simply cannot support 400 vendors," said David Lady, founder for ELD maker GeoSpace Labs. Anticipating an ELD market shakeout has been part of GeoSpace's long-term business strategy, he said, and the company has tried to carve out a dedicated niche with its focus on agriculture and other markets. Lady said he has declined acquisition offers from other companies. "There are a lot of small players who could not get traction," said Tapan Chaudhari, founder and chief executive officer for ELD provider TruckX. "Vendors who have maybe ELDS' LOOMING SHAKEOUT More consolidation predicted in crowded e-logging market, posing more costs and headaches for owner-operators BY JAMES JAILLET In early 2020, small-fleet owner Alipio Montano equipped his 2007 Freightliner Classic and 2012 Peterbilt 389 with VDO RoadLog ELDs. Two months later, the ELD vendor announced its service would end — the second time an ELD provider abruptly forced Montano to change.

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