Truckers see rise in predatory towing

A recent report by the American Transportation Research Institute indicates trucking companies are seeing more predatory practices and instances of excessive towing rates, according to a release by the Arkansas Trucking Association.

"Predatory towing has received increased attention from the trucking industry in recent years, as non-consensual tows often create costly consequences for motor carriers and insurance companies as well as negative impacts to supply chains," the report said. "Because most heavy-duty truck crash scenarios are unique, they present trucking and T&R stakeholders a series of complex tasks, decisions, regulations and interactions that can easily enable predatory practices."

The American Transportation Research Institute is a nonprofit research organization for the trucking industry. The report defined predatory towing as "generally, any incident in which a T&R company egregiously overcharges, illegally seizes assets, damages assets by use of improper equipment, or illegitimately withholds release of a truck, trailer, and/or cargo."

"Trucking companies doing business in Arkansas are often faced with the conundrum of overpaying for services provided or disappointing their customers and disrupting the supply chain," Shannon Newton, president of the Arkansas Trucking Association, said in a statement. "The vulnerability of a company when they need services and the lack of accountability for providers leads to excessive, unexpected costs to trucking companies."

The report notes the two most common forms of predatory towing are excessive rates and unwarranted extra service charges. According to the report, 82.7% of motor carriers experienced excessive rates and 81.8% received unwarranted additional charges.

The report noted in crash-related tows, 29.8% had some sort of "predatory billing," based on an independent analysis of motor carriers' complete records of original towing invoices from 2021, 2022 and 2023.

Tim Moody, the president of the Arkansas Professional Towing and Recovery Association--which represents 761 towing companies in the state,--said in a Friday interview that in Arkansas there is no legislation dictating how much can be charged for a tow, as long as the fee is reasonable. He said nonconsensual tows typically involve accidents where the requirements are extremely variable and cleanup times and costs can be extensive.

He said in instances when trucking companies feel the fees they've been charged are excessive, they have a remedy through the Arkansas Towing and Recovery Board -- an arm of the state that is not associated with the Arkansas Professional Towing and Recovery Association. The Arkansas Towing and Recovery Board is the state's primary enforcement and investigative body charged with ensuring compliance with the state's statutes and rules and the disposition of consumer complaints, according to its website.

"It's as simple as going to the website and filing a complaint with the board," Moody said.

Marc Scott, assistant professor in the Department of Supply Chain Management at the Sam M. Walton College of Business at the University of Arkansas, said in response to emailed questions that excessive fees and overcharges can affect all truckers but they can be particularly damaging to smaller operators.

"For smaller carriers, these charges can cause a significant impact to their financial performance and potentially impact owner-operator business continuity in the short-term, or even long-term in instances," Scott said.

The report pointed to some ways trucking companies could deal with these issues, including methods to avoid, identify or address predatory towing, such as invoice reviews and the best way to gather data to dispute a charge when needed.

"In the face of inflation, fuel prices and other rising expenses, the cost of operating a trucking company is at an all-time high. These unpredictable and unfair towing rates are unnecessarily contributing to those costs," Newton said.

Information for the report included a survey, distributed through the American Transportation Research Institute's contact database and industry news outlets. The survey generated a convenience sample of 350 motor carrier respondents, according to the report. The group also obtained 490 complete invoices from various sources.

"The ATRI report echoes the experiences of many small-business truckers who have discovered the various state and local regulations that govern towing are often ineffective to prevent predatory activities," Lewie Pugh, executive vice president of the Owner-Operator Independent Drivers Association, said in response to emailed questions. "The issue for our members is about 'non-consensual' tows, which usually occur when towing companies are called not by the truck driver involved in the accident but by the highway patrol concerned with clearing accidents as quickly as possible. Some towing companies will take advantage of truckers. We've seen bills go well into six figures! If there's no regulation, it's an open checkbook."

Pugh said the Owner-Operator Independent Drivers Association has worked with a number of state legislatures to improve equitable towing practices, including recently in Maryland.