Apr 1, 2001 12:00 PM, Charles E Wilson
ON A FOGGY night, a McKenzie Tank Lines Inc rig hauling 7,500 gallons of resin solution rolls westbound on I-40 through Tennessee. It's the first time on this stretch of highway for the 30-year-old driver, but he's behind the wheel of one of the smartest tractors in the McKenzie Tank Lines fleet.
Just west of Cookeville, the Vehicle Information Profiler(VIP) screen on the dash lights up. It displays a Smart Geocell message system warning that the rig is entering a “high truck accident area with curves for the next three miles on I-40 west.”
The in-vehicle Trucker Safety Advisory(TSA) system is still experimental, but it could become standard equipment in the not-too-distant future. Tallahassee, Florida-based McKenzie Tank Lines is testing TSA and two other on-board safety technologies in cooperation with Mack Truck Inc and the Department of Transportation (DOT) as part of the Intelligent Vehicle Initiative (IVI).
“We're honored to be a part of this important test program, and we believe it holds real potential for the future,” says Jim Shaeffer, president of McKenzie Tank Lines. “We think it's important to participate in the development of new technologies for our industry, and we believe that on-board electronics can help bridge the knowledge gap for the less experienced truck drivers who are beginning to make up a sizable percentage of the overall driver population.
“This is an opportunity to promote new technology that reduces risk. Over 80% of our DOT recordable accidents in 2000 were non-preventable, but we may be able to avoid some of those in the future with these new technologies, in addition to reducing preventable accidents. Our customers are interested in what we are doing to prevent accidents involving their products.”
This willingness to look toward future technology has helped make the tank truck carrier an industry leader. However, technology is not the only area in which McKenzie Tank Lines demonstrates leadership.
In financial performance, the company was ranked among the top 25 tank truck carriers in Modern Bulk Transporter's 1999 Gross Revenue Report with $62.6 million in gross revenues. Even as the economy tightened late last year, McKenzie Tank Lines boosted revenues to nearly $70 million.
“We had a record year in 2000, with 11% growth,” Shaeffer says. “We attribute that to the fact that we remain a niche player and have a relatively balanced, though diverse business base within that niche. The diversity is turning out to be a real asset now that some sectors, such as chemical hauling, are experiencing a nationwide slowdown.
“We believe we do a very good job of maximizing our resources. We track revenue day to day, and we get weekly flash reports on driver and equipment utilization. We want driver utilization of at least 83% every day. To do that, we're working with our customers to get away from the 8 am delivery mindset. Our most profitable locations have activity on weekends and holidays. Typical productivity for many locations is 23 days a month, so there is plenty of room for improvement.
“This year started out strong, and the cold weather has been very good to us. This was one of the coldest winters in Florida, and we've been running propane all over the Southeast. We hauled a lot of LP-gas in the first three months of 2001. In fact, we had more opportunity than we could handle.”
Growth also has come through acquisition, the newest purchase being Nance & Collums Inc, Fernwood, Mississippi. “We completed the Nance & Collums acquisition on January 16,” Shaeffer says. “Nance & Collums fills a geographic void that we had in part of the Southeast, and it also addresses some other service gaps. We hope the acquisition will give a boost to our dry bulk business, which has been flat.”
Nance & Collums' focus is on liquid and dry bulk edibles — sweeteners, sugar, and salt. The carrier also hauls packaged freight in van trailers. In addition to its headquarters terminal in Fernwood, the carrier has a facility in New Iberia, Louisiana.
“We will operate Nance & Collums as McKenzie/NCI,” Shaeffer says. “They built an excellent reputation, and they have excellent people. The NCI identity is important. We will leave the NCI colors and logo for the time being.”
Nance & Collums adds 70 tractors to the 600 operated by McKenzie Tank Lines. Ninety-two of the McKenzie Tank Lines tractors are supplied by owner-operators, compared with 20 owner-operator tractors at Nance & Collums.
In contrast with Nance & Collums, McKenzie Tank Lines may be best known as a chemical hauler. However, the range of cargoes is very diverse — caustic, acids, papermill liquor, propane, butane, ammine, gasoline, jet fuel, diesel, lubricants, number six oil, asphalt, and cement.
The trailer fleet at McKenzie Tank Lines also is diverse, and it became even more so with the addition of the Nance & Collums equipment. The 1,100 units in the McKenzie Tank Lines fleet include tanks, pneumatic dry bulkers, propane transports, vans, and flatbeds. Nance & Collums added 115 tanks, pneumatic dry bulkers, vans, and flatbeds.
Management has worked hard to ensure that all of this growth isn't just for growth's sake. They have sought out strategic rate increases to give the carrier an acceptable level of profitability.
“Most of our customers have been open to discussing cost issues,” Shaeffer says. “They want us to succeed and be able to operate safely. However, we must be able to clearly identify the higher costs that justify a rate increase.
“Some markets remain very competitive, especially areas with high concentrations of tank fleet activity, such as Texas. We won't operate unprofitably, though. We have an obligation to our shareholders and employees, and we will walk away from bad business.
“We're also considering the bottom-line impact of hold-harmless agreements. We're taking a hard-line approach toward them. I consider it unacceptable to take on a shipper's liability.”
Jack Faulkner, vice-president of sales and marketing, adds that McKenzie Tank Lines benefited from accurately calculating surcharges to cover rising fuel prices. “We used a national average,” he says. “We asked all of our customers for fuel adjustments, and we got agreements from just about everyone.”
One reason McKenzie Tank Lines has been successful in its requests for fuel surcharges and rates is that it provides customers with high-quality services tailored to their needs. “We have filled a niche in this industry with our custom-built tank trailers,” Faulkner says. “We have a large trailer fleet for a company our size. Since we build our own, we can customize units to meet very specific needs.
“In addition, our top management is very accessible to customers. We have an operations team, rather than a single person as an operations manager. We listen to what our customers say, and then we respond.”
For instance, when some customers decided to outsource their logistics operations, McKenzie Tank Lines jumped at the opportunity. “We put our own dispatchers into their locations,” Faulkner says. “Today, we probably handle 90% of the shipments out of those locations with our own equipment, but we also use other carriers.”
Shaeffer adds that the tank truck carrier has significantly boosted productivity levels at the seven locations where it manages the logistics activity. “We're better able to forecast asset utilization because we know when customer production is increasing,” he says. “We have a better understanding of the factors that affect operations for each customer.”
Special projects appeal to the carrier, and one of the most unusual opportunities appeared following Hurricane Georges in September 1998. Islands in the Caribbean, including Puerto Rico, were especially hard hit.
McKenzie Tank Lines was approached by federal disaster aid officials, who asked for the carrier's help in lining up 30 tractor-tank-trailer rigs with drivers to transport drinking water in Puerto Rico.
“This was a unique project that showcased our ability to think outside the box,” Shaeffer says. “We assigned 30 Spanish-speaking drivers under the direction of Gabe Bell, director of training at the time. They and their equipment were airlifted to the island, and they were there for 30 days.”
Although McKenzie Tank Lines is often perceived as a regional carrier, customer demand has taken it far afield. Today, service is provided throughout North America, and the carrier is even developing business in the Caribbean region.
Mexico looks very promising. On any given day, McKenzie has 10 to 30 tank trailers running in Mexico in conjunction with several partners. Interlining is handled through the McKenzie Tank Lines terminal in Brownsville, Texas. The Mexico connection is credited with bringing in additional US business.
“We know that the US/Mexico will be opened in the near future, and that will bring new opportunities,” Shaeffer says. “Creative companies will benefit, and we intend to be one of the beneficiaries. We may look at an equity arrangement with a Mexican carrier or some other arrangement.”
Most of the company's 36 terminals are in the South, the carrier's traditional operating area. The terminal network has spread as far west as Texas and north to the Chicago, Illinois, area.
“We've opened 10 new locations in the past five years, and major customers keep asking us to extend our operations into other parts of the country,” Shaeffer says. “Acquiring additional business in the Chicago area in 1999 gave us a jump start in the Midwest.”
With the encouragement of customers, McKenzie Tank Lines is beginning to explore terminal locations in the Northeast. “We want to reduce our reliance on brokers in the region,” Faulkner says. “We really only break even on brokered loads.”
The terminal network incorporates extensive maintenance capabilities, including a major tractor shop and the tank trailer manufacturing operation (Terminal Service Co Inc), both of which are based in Tallahassee. Also part of the network is seven chemical wash racks.
“Our largest wash rack is in Pensacola, Florida,” says John D Jackson, vice-president of finance. “It runs 24 hours a day. With the exception of an occasional customer trailer, we clean just our own equipment. We have enough activity with that.”
While tractors and trailers are domiciled at specific terminals, longhaul operations are under the direction of the Central Networking Center (CNC) in Tallahassee. This highly computerized central dispatch is open 24 hours a day with a minimum of two staffers on duty at all times. A Spanish speaking dispatcher is now available at night to handle calls from the Mexican partner.
CNC is linked with all areas of the company through the carrier's computer network, which has just undergone an extensive upgrade. Even the drivers are connected through the Qualcomm satellite communication units in the tractor cabs.
Drivers are hired by the terminal where they are based, but they probably work as closely with the CNC staffers as anyone else in the company. Every effort is made to develop a good working bond.
“We do everything we can to keep good drivers,” says Richard L Healy, vice-president of safety and compliance. “It's a challenge that we work at every day. It is as important as recruiting good quality drivers to fill openings. We believe we're doing a good job, but our turnover is around 60%.
“Many drivers leave because they want out of trucking, and this is an industrywide problem. They want to spend more time at home. Pay is an issue, but it is not the primary concern.”
McKenzie Tank Lines uses a variety of techniques to keep the driver seats filled in its tractors. For instance, the carrier recruits drivers graduating in the top 20% of their class from selected vocational-technical schools. Approximately 12 schools are on the approved list.
Experience is the only compromise the carrier has made in its vo-tech hiring standards, and every effort is being made to offset that through additional training. To be considered as a driver, an applicant must be at least 23 years old. Two years of over-the-road truck driving is required for everyone except those applying under the special vo-tech program.
Applicants must be able to provide a virtually clean driving record: No DOT-recordable traffic accidents in the past 36 months, no more than two moving traffic citations in a commercial vehicle in that time period, no convictions for serious traffic violations in a commercial vehicle in the past 36 months, no license suspensions or revocations, and no driving-under-the-influence convictions.
New hires go through a training program that is designed to thoroughly orient them to the way McKenzie Tank Lines does business. Defensive driving is stressed throughout the initial orientation.
Within 45 days of employment for an experienced driver, the initial orientation must be followed by a ride with one of the regional safety supervisors. For those fresh out of driving school, a ride with a regional safety supervisor and the local terminal manager comes at the completion of the McKenzie Tank Lines training program.
The safety supervisor stresses the positive aspects and advantages of being a valued McKenzie team member. He covers a wide range of topics: company history, organizational structure, employee benefits, company expectations, strict adherence to hours of service, spill prevention measures and techniques, safety mirror adjustments, mandatory use of safety gear, importance of driver safety meetings, and importance of reading and rereading the driver manual.
Rides aren't limited to new hires. Each of the four regional safety supervisors is expected to conduct 12 rides a month with veteran McKenzie Tank Lines drivers, as well as those newly employed. “Our regional safety supervisors rode with more than 350 drivers last year,” Healy says.
The regional safety supervisors also conducted over 250 safety assessments at loading and unloading locations over the past year. The goal is a minimum of six assessments each month, and facilities are preselected based on new locations, incident reports, and driver comments. “Our objective is to help customers eliminate problems that could cause incidents or accidents during loading and unloading,” Healy says.
Training is a part of the monthly safety meetings at each terminal. Terminal managers conduct two of the three meetings in each quarter, and the third one is handled by the regional safety supervisor.
While the meetings are crucial tools in delivering the company's safety message, driver incentives provide important reinforcement. In addition to a driver safety bonus, a key element in the incentive program is the Top Driver Award.
To be eligible for the award, a driver must log a minimum of 500 on-duty hours during a given calendar quarter. In addition, the driver must avoid service failures in the following 11 categories: customer complaints, untimely product pick-up and delivery, trip log violations, product contaminations, product spills, chargeable traffic accidents, DOT infractions/traffic tickets, preventable product heels, safety gear violations, lost duty time due to preventable on-the-job injuries, and documented disciplinary actions.
Drivers who qualify will receive $125 each quarter. After four consecutive quarterly cash awards, a placard with the driver's name and Top Driver Award designation is placed on his assigned tractor. The placard remains as long as the driver continues to qualify for the quarterly bonuses.
While employees receive most of the attention in the safety program, families are not ignored. One of the most successful programs is the annual Safety Awareness Poster Contest that is open to all minor dependents of McKenzie Tank Lines employees. Winning posters are reproduced and displayed at all of the carrier's terminals and at the corporate office. Winners receive US savings bonds and Junior Safety Manager certificates.
“We've been doing the poster contest since 1996, and it is a great way to get the safety message out,” says Cathy Wilson, safety coordinator. “The purpose of this contest is to send a message to our employees from their children to come home safely everyday from their assigned duties.”
The safety activity extends even beyond the families of employees. “We believe community and industry involvement is essential,” says Bob Byers, director of safety. “For example, we work closely with the Florida Highway Patrol and Florida Department of Transportation. We have a ride-along program in which state troopers are invited to ride in our tractors and our drivers have a chance to ride in the patrol cars.
“We work with TransCAER (an American Chemistry Council initiative), and we provide demonstration equipment for LEPC (Local Emergency Planning Committee) meetings. We recently worked with Liberty Mutual Insurance on a spill prevention video.”
All of the activities and programs are part of McKenzie Tank Lines' effort to approach safety from a risk-management perspective, and it has paid off. The carrier's DOT recordable accident rate for 2000 was .893 per million miles, and the preventable level was .261.
For DOT roadside inspections, the carrier has a 10% equipment out-of-service rate, compared with 24.3% for the trucking industry as a whole. Driver out of service was 1.9% (vs an 8.3% national average), and hazmat out of service was 1.2% (vs a 7.5% national average).
Healy says it's clear that the emphasis on safety helps retain drivers. Well-specified and well-maintained tractors also contribute to retention.
Drivers see from the moment they climb into the cab of a tractor at McKenzie Tank Lines that they are being provided with some of the most modern vehicles on the road. The carrier's desire to be a leading-edge company is a big reason why it was chosen to participate with Mack Trucks Inc in the DOT's Intelligent Vehicle Initiative (IVI).
The IVI program that McKenzie Tank Lines and Mack Trucks Inc are involved in consists of three basic components: SafeTRAC by Assistware, In-vehicle Trucker Safety Advisory(TSA) System (Smart Geocell), and Automatic Collision Notification. Eaton's Vorad EVT-300 Collision Warning System with SmartCruise option is a supporting technology in the test.
SafeTRAC is a lane-departure warning system that uses optics to warn an operator of unplanned lane position deviations that might result in an accident. It determines vehicle position in relation to the lane markings on the road and provides audible warnings whenever a solid or intermittent line is crossed without the turn signal or brakes being activated.
The system also provides a numeric Alertness Index Score based on the driver's ability to stay centered in the lane. A score of 70 to 90 is average. If a score of 50 or lower lasts for 10 minutes or longer, a message flashes telling the driver to “Get Rest.”
The TSA system reports known hazards to an operator as the vehicle travels on the highway. Hazards such as tight merge and weave areas, construction zones, high rollover risks, congested traffic, and others are identified by their respective latitudinal and longitudinal positions. This information is stored in the onboard Xata computer. When a hazard area is encountered, the driver is alerted by an audible tone and a brief text message that appears on the VIP display.
The Automatic Collision Notification system identifies when an accident occurs and transmits an alert to the McKenzie Tank Lines CNC via satellite messaging. Sensors on the tractor identify rollover, frontal collision, and rear-end collision. This allows McKenzie personnel to be proactive in alerting response teams to the commodity being transported.
Thirty-six McKenzie Tank Lines tractors are being used in the 18-month, $1.7-million test program. “We'll turn about four million miles total with the tractors assigned to the test, and we should be able to gather some excellent results,” says Jim Kennedy, director of maintenance.
The IVI participation is just the tip of the iceberg of test activity at McKenzie Tank Lines. Other programs include:
Enhanced protective glass that combines dual sheets of annealed glass laminated together with an interlayer developed by Solutia. This laminated glass has extraordinary strength and will not shatter or splinter with rock impact. It replaces the standard rear glass on daycabs.
MeritorWABCO's Electronic Leveling Module (ELM) maintains the proper ride-height adjustment of the air suspension. Consistent ride height extends the life of driveline components. This system allows driver-controlled suspension height adjustment by use of a keypad when unloading product from a rear-unload trailer.
MeritorWABCO's Electronically Controlled Air Suspension (ECAS) acts as a traction-control system on a 6×2 tractor. When the system senses wheel slippage on the drive axle, the air suspension begins to deflate the rear tag axle. This action shifts weight distribution to the drive axle. Upon regaining traction, the system automatically reinflates the suspension to the proper ride height.
Vesplex, designed by Vehicle Enhancement Systems, is an advanced short-range vehicle-to-office communications link. An infrared base unit is placed in-line of the J1708 connection to the shop computer. An infrared mobile unit is attached to the vehicle J1708 connection. Wireless two-way communication is established to the vehicle's electronic control unit. Stored vehicle data can be downloaded automatically when the tractor is within transmission range. Wireless programming of vehicle and engine parameters also is accomplished with this system.
McKenzie Tank Lines is composed of 97% Mack tractors, and the IVI test systems were installed in Vision mid-rise sleepers, Mack's newest linehaul tractor. The tank truck carrier also runs Mack CH conventionals. The fleet includes both sleeper and daycab versions.
The newest Mack Visions have Mack E7-355/380 engines, six-speed Mack T2060A transmissions, and tandem drive axles with a 4.17 ratio. Among other tractor components are Goodyear 295/75R22.5 tires, Alcoa aluminum disc wheels, Meritor S-cam brakes, and Centrifuse drums.
A majority of the carrier's 600 plus tractors are assigned to chemical operations, which account for 53% of the company's activity. A driveshaft from the tractor PTO powers trailer-mounted Ranger and Roper product pumps on the chemical trailers. Blackmer pumps are used on propane trailers.
Most chemical trailers are built by Terminal Service Co Inc (TSC), McKenzie Tank Lines' tank trailer manufacturing and repair operation. The carrier has been building its own stainless steel tank trailers since the 1960s, and the shop crew turns out about 30 new tank trailers a year, according to Donnie Alford, TSC vice-president of operations.
“We believe we gain advantages by building inhouse. It gives us the opportunity to customize equipment to specific customer needs,” he says. “In addition, we can complete a tank faster than most of the other manufacturers.”
TSC builds DOT407, DOT412, and noncode tank trailers. The standard DOT407 is double conical, holds 7,100 gallons, and is insulated and steam heated. The five inches of fiberglass insulation has a 300° F capability.
Vapor recovery is now standard, and plans are to adopt the Truck Trailer Manufacturers Association standard once it is completed. Other hardware includes Girard pressure- and vacuum-relief vents, and Betts domelids and discharge valves. Running gear consists of Reyco spring suspensions, Meritor TP axles, Hayes-Lemmerz lightweight steel hubs, steel disc wheels, and Goodyear steel-belted radial tires.
Building tank trailers inhouse is just another aspect of McKenzie Tank Lines' effort to be an industry innovator. It is a goal that the carrier certainly has achieved.
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