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Is Another Trucking Bloodbath on the Horizon?

In 2018 the trucking industry was flourishing. Drivers were earning more than ever before, which quickly drove people into entering the career. But, in 2019, things took an unexpected turn. As things grew, the demand for trucking services declined, leading to more than a thousand trucking companies going out of business. The incident was later coined “the bloodbath of 2019”.

Now, experts are certain another “bloodbath” could be on the horizon. The question is: are they right?

What caused the bloodbath of 2019?

2017 through 2018 was a prosperous time for carriers in the trucking industry, but when 2019 rolled around, the market dried up and led to a period of contraction. This trying time was labeled as a trucking bloodbath due to the operating ratios for dry van carriers averaging over 100%. Carriers also battled oversupply, lack of demand, and fallen investments. In 2018, fleet owners thought it wise to invest in new trucks, but their investments later proved unbeneficial as 2019’s daily truckload volumes were over 4% under 2018’s volumes. Combined, these factors contributed to many trucking companies closing shop and hundreds of industry professionals without a job.

What is causing the latest trucking bloodbath?

The COVID-19 pandemic has wreaked havoc on global freight markets for the past two years. As we’ve attempted to move forward, the market has taken an unfavorable downturn, and the result could be as detrimental as what we saw in 2019.

Unfortunately, truckloads have already been relatively soft. While March has proven to be a stronger month in previous years, this year’s has not seen the same surge. A few factors contribute to the market’s current state, and industry professionals worry they could be enough to spark yet another bloodbath.

The contributing factors include:

1. Soft truckload volumes and spot rates

In 2020, inflation began creeping up, causing many consumers to slow down on spending and truckload volumes to lessen more and more. This slow truckload decline only worsened when Russia invaded Ukraine at the start of 2022. For the past few years, industry experts have monitored the dwindling volumes and confirmed that spot rates are also falling fast.

With too many trucks on the road and insufficient freight to load them with, spot rates have skyrocketed. In January, spot rates reached $3.83 per mile, and while they are now down to $3.42 per mile, many experts aren’t exactly sure how the rest of the year will play out.

2. Inflation and high fuel prices

As most Americans know, fuel prices, along with everything else, are higher than it’s ever been. This economic chaos is responsible for curbing consumer spending, therefore affecting truckloads and conjuring the foreseen bloodbath.

3. Consumer spending on the decline

After years spent indoors (thanks to the COVID-19 pandemic), consumer spending on physical goods has slowed, while spending on travel and entertainment has increased. Unfortunately, experiences do not drive much in the way of freight. This spending trend has taken much longer to balance out than most experts expected. In fact, in February, retail sales only reached 0.3%, and they haven’t been much better in the proceeding months.

 4. Inventory struggles

The lack of inventory has also played a significant role in why many experts believe another bloodbath is on the horizon. After the pandemic, transshipment infrastructures were clogged up, and freight velocity slowed. Many companies were left with barren shelves and unhappy customers. So, the same companies ordered more stock to safeguard themselves against inventory outages. However, this plan backfired and left businesses with more than they needed after prices spiked and consumers cut their spending habits. Now, experts believe the purchasing of goods will slow to work off excess inventory, and truckloads will continue to remain light.

Will some fleets survive the bloodbath?

So far, most of the larger trucking companies have had decent first-quarter earnings this year. According to market projections, analysts believe that the more established fleets will continue to prosper. However, smaller companies may not be so lucky.

Larger carriers don’t have to worry about spot loads or adjust pricing to account for customer rate cuts, whereas smaller fleets don’t have the same luxury. However, both small and large companies should still be cautious. In 2019, hundreds of fleets went bankrupt, three times as many as the year prior. So, when it comes to fleet survival, it really depends on several factors, such as location and client relations.

Moving forward, owners and operators can expect lower rates and an influx of new fleets entering the market, even after loads soften. And with everyone chasing after high spot volumes, fewer opportunities will be available. And as we saw in 2019, the declining spot rates, dwindling volumes, and increased prices will continue to push fleets into another trucking bloodbath. We all just have to hang on for the ride.

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Top 10 Father’s Day Gifts for Truckers

Father’s Day is right around the corner! Have you gotten something for your trucker dad? Well, if you aren’t sure what to get for your truck-driving dad, we have some ideas that will make his life on the road more enjoyable.

Whether your goal is to keep dad comfortable or entertained or just make his life a little more convenient, these gifts are sure to impress. After all, he works hard all-year-long and deserves to be treated extra special on his special day.

Here are our top 10 picks for your favorite truck driver.

1. A Model of His Truck

Truck drivers are incredibly proud of their rigs and the work they put into them. Some even go as far as to customize them with bold paint jobs. So, if your dad’s truck is his pride and joy, then a model of his rig would be the perfect gift. You could even customize your model to feature your dad’s name or go for a replica. Either way, your trucker dad is sure to display his gift with pride.

2. A New Truck Seat

Drivers spend a lot of time on the road. Some can spend up to 12 hours a day or more hauling freight. And with so many hours spent in the same old seat, your dad could experience persistent back pain or chronic leg problems. That said, a new seat could be a nice upgrade for dad. Be sure to choose a seat that is on a suspension system with ergonomic support. A good seat will not only be comfortable, but it will also be good for dad’s health.

3. A Wireless Headset

Truckers rely heavily on their headsets. If your dad’s headset is on the older side, consider upgrading it for Father’s Day. Today’s headsets often have noise-canceling capabilities and crisp, clear sound quality. Some headsets even offer mute capabilities, speed dial, and more.

4. Audio Books

Nothing helps pass the time quite like a good audiobook—gift dad with a subscription to an audiobook site. He can browse through the hundreds of titles and genres and choose what he likes. He can also search through a list of audiobooks where truck drivers share their stories.

5. A GPS

Traveling to an unfamiliar place can be stressful, even more so when hauling a larger rig. Help dad stay on the right path with a trucker-friendly GPS. A GPS specially built for truck drivers offers trucking routes that help commercial drivers navigate complex city streets and new locations.

6. A Thermoelectric Cooler

An iceless cooler is a perfect gift for a trucker who’s always on the go. They keep refrigerator items nice and chilled and are powered by a power cord that plugs directly into the dash. And while they come in a few different sizes, some are large enough to hold up to 44 cans. 

7. A Heavy-Duty Phone Case

Life on the road is filled with tough surfaces and hard knocks. Save your dad from a cracked screen or broken phone by gifting him with a phone case that can keep up with his lifestyle. A heavy-duty phone case can be the difference between your dad having a working, damage-free lifeline.

8. A SiriusXM Radio Subscription

Any truck driver will tell you there’s nothing quite like driving on the open road with your favorite tunes filling your cab. This Father’s Day, give your dad the ultimate music-lover gift, a subscription to SiriusXM Radio. There are over 175 channels to choose from, so your dad is sure to find a station he likes. They also offer several different subscription options so that you won’t break the bank.

9. A Power Inverter

When your dad is on the road, he shouldn’t have to worry about one of his devices being out of juice. A mobile power supply would ensure that all of his devices remained charged and ready to use! Be sure to find one that offers charging options for several different devices and is usable on and off of the truck.

10. A Sentimental Keychain

And finally, if your dad is the type that has it all, a sentimental keychain is sure to be his favorite. Go for one that says “#1 Dad” or “Drive Safe, Dad.” Whatever message you choose, he’ll think of you and how much you care every time he gets on the road.

Any of these items would make for a perfect gift and show your trucker dad just how much you care. And you can bet that any time he uses his gift, he’s sure to think of you and smile.

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Pros and Cons of Battery-Electric Trucks

Image Credit: Tesla

In today’s world, electric vehicles account for approximately two percent of auto sales, and that number only continues to grow. Now, electric semi-trucks and freight vehicles, or commercial battery-electric vehicles (CBEVs), are merging onto America’s roads and highways. Manufacturers have poured billions of dollars into developing CBEVs, and companies are slowly integrating the new technology into their fleets. And while the focus has mainly been on Class 8 trucks, automakers are introducing commercially available models in numerous classes.

So, what exactly does this electric revolution look like and who is responsible?

Who are the key creators of electric semi-trucks?

Very few automakers dared to venture into the world of EV manufacturing. However, those who did are now reaping the benefits of their investment. Currently, Volvo Trucks offers two tractor configurations for their electric Class 8 trucks, including a 4×2 and a 6×2. These trucks provide different ranges that are dependent on the amount of cargo you’re hauling and the overall size of your trailer. The manufacturer also sells an electric box truck model, which offers a range of 150 miles on a single charge. 

And in 2021, Volvo received its largest order from Quality Custom Distribution (QCD) for its VNR Electric model. The foodservice logistics supplier ordered a total of 14 electric trucks for their Southern California drivers. While the new EVs won’t significantly impact QCD’s original fleet of 700 fuel-powered trucks, it’s a step in the right direction. Daimler has also been a key player in the EV market with models like the Freightliner eM2 and Freightliner eCascadia. And while Volvo and Daimler have been innovators in the trucking industry’s EV movement, Tesla has recently unveiled what may be the new standard in trucking…

Check out the reveal of the new Tesla Semi

How will electric semi-trucks shape the future of trucking?

Experts from the U.S. Energy Information Administration estimate that battery-electric trucks will account for 31% of the industry or reach around 672 million vehicles by 2050. Undeniably, this would reshape the trucking industry and the world as we know it.

In a single day, a fuel-powered truck will be on the road for up to 11 hours, all while producing harmful emissions. And if a team of drivers runs the truck, it could be on the road even longer. But, if a company were to deploy just one EV, it would be equivalent to placing over a dozen electric sedans on the road, thus significantly reducing harmful emissions. 

The North American Council for Freight Efficiency (NACFE) created Run on Less – Electric, a trucking demonstration that set out to determine the pros and cons of EVs. The run further confirmed that CO2 and particulate emissions would be significantly reduced by replacing traditional trucks with electric ones.

Electric trucks also reduce noise pollution and provide optimal safety through intuitive technology and design measures. For instance, the Tesla Semi is built with active safety features that help to prevent jackknifing. Volvo Trucks also attempts to provide enhanced safety through a new, patented safety feature called Active Grip Control. The feature “improves stability, acceleration, and braking in slippery conditions.”

What concerns come with battery-electric trucks?

While there are clear advantages to using BEVs, there are some concerns. 

The main concerns include:

  • The effects of extreme weather and temperatures on electric trucks.
  • Maintenance costs and schedules.
  • Availability of parts and services.
  • The overall safety of electric trucks.

Thankfully, some testing and trial runs have shed light on the above mentioned issues. The NACFE’s Run on Less – Electric found that extreme weather and temperatures don’t pose any serious threats to BEVs’ overall performance or vitality. 

RoL-E also proved that overall maintenance costs and failure rates are less than internal combustion vehicles. However, when the microchip and automotive technology shortage struck the nation in 2020, many EV manufacturers found themselves between a rock and a hard place. Automakers were not only unable to produce new electric models, but they weren’t able to make most of the necessary parts or components. This led many owner-operators to question whether or not moving to BEVs would be wise, considering the unpredictability of the future.

What should fleets keep in mind moving forward?

Before fleets commit to transitioning to BEVs, there are a few things that fleet managers and owner-operators should keep in mind, including:

  • How many miles are being driven?
  • How often would charging need to take place for each truck?
  • Will charging stations or at-home charging need to be installed?
  • How many BEVs would be needed?
  • Would a partial conversion make more sense than replacing the entire fleet? Or vise-versa.

Fleet managers must also consider a maintenance plan for their electrified fleet. Industry experts who’ve made the move recommend “[getting] your mechanics in there and [getting] them trained” in the new-age technology. Finally, if owner-operators choose to transition to CBEVs, they must implement proper safety protocol and invest in new safety equipment, including arc lash shields, dielectric boots/shoes, electrical safety gloves, insulated tools, etc.

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Where is the Best Place to Work as a Truck Driver?

What to Consider when Choosing Your Destination

Truck drivers are some of the country’s top earners and for a good reason. They work tirelessly to keep our world turning and our economy thriving. So it’s no surprise that a truck driver’s salary is competitive compared to other industries. On average, a truck driver can earn anywhere between $40,000 and $78,000 per year. But, did you know there are some states where the money for trucking is even better? However, you must be careful when deciding on where to go. In some states, the cost of living and state regulations could significantly impact the amount of money you actually make. 

Like any profession, each state offers different pros and cons. For instance, while one state may see a higher average annual pay, other factors like natural resources and geographic proximity could impact that number, ultimately making you less than the supposed average. That’s why it’s crucial to weigh all factors carefully before deciding where to reside as a truck driver.

The main factors to consider include:

1. The Cost of Living 

In most industries, the average pay varies from state to state, and, in some cases, the pay doesn’t always correspond to the cost of living within said state. Most of the time, a truck driver’s income is based on the specific route they drive, the type of freight they’re hauling, the difficulty of the job, and the company’s standards. But unfortunately, most companies don’t factor the cost of living into their wages. So, if you choose a state with a lower cost of living, your paychecks will go further.

2. Income Taxes

You must also consider the state’s income tax rates. If you want more take-home pay, you’ll want to choose a state with a lower income tax rate. As of 2020, only seven states offer no personal income tax, including Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming. With these rules and regulations constantly changing, it’s wise to seek advice from a tax professional before deciding on a new job in a new state.

3. Quality of Life

While pay is a crucial factor when choosing your career and the location you’d like to work in, it should ultimately come second to the quality of life. For instance, some states offer better roads and highways, safer public rest areas and truck stops, and cheaper parking. These factors not only make your job easier, but they can help to reduce out-of-pocket costs and stress. You’ll also want to look into your state’s crime area to ensure the safety of your home and neighborhood.

4. State Regulations

Like pay, industry regulations can vary from state to state, and these regulations can impact trucking companies and drivers. And if the trucking company is on the smaller side, they could have trouble adapting due to limited resources. Unfortunately, if the company doesn’t have access to things like new equipment and personnel, these regulations could come at a high cost. If these added costs are passed on to the customers, you could see reduced pay.

5. Geography and Natural Resources

You should also consider the type of freight you’ll be hauling, the population, the geographic location, proximity to other states, international borders, and shipping ports when choosing a state to work in. You’ll also want to determine what natural resources the state you’re considering is known for since there’s a good chance you will be hauling it at some point or another.

6. Freight Volume

As previously mentioned, you’ll want to consider the amount of freight you’ll be hauling across states. The amount of cargo you handle often affects the pay you’ll receive per job. The states with the most freight being moved include Texas, California, Illinois, and Ohio.

The type of freight is also necessary to note, as it can also determine how much money you could be making.  

  • Top states for flatbed hauls: Alabama, Texas, Arkansas, Georgia, and Mississippi
  • Top states for refrigerated loads: Texas, California, Illinois, Ohio, and Georgia
  • Top states for van loads: Texas, Illinois, Ohio, California, and Georgia

What are the best states for truck drivers?

Ready to find new territory? Make sure you get the most up-to-date information before deciding where to land. 

Here are the top five states to work in as a truck driver:

STATETOTAL JOBSAVERAGE SALARYHIGH/LOW
Kentucky6,466$72,287$107,000/$48,000
Indiana9,598$71,429$105,000/$48,000
Ohio15,146$70,880$105,000/$47,000
Pennsylvania14,369$71,491$106,000/$47,000
Delaware1,484$71,947$107,000/$48,000

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Demand for Truckers Dwindles: Recession on the Rise?

The demand for trucking has taken a shocking turn. According to Bank of America, shipping demand is “near freight recession levels,” and the prospects surrounding freight capacity, inventory levels, and shipper rates are moving in a similar direction as they were in the Summer of 2020, at the height of the COVID-19 lockdown. 

The managing director of Bank of America, Ken Hoexter, said in a recent investor’s note that a survey found that the demand for trucking is down 23% year-over-year (y/y), and the Truckload Demand Indicator fell to ‘58’— the lowest it’s been since June 2020. 

So, what does all of this mean for the future economy? This article will break down what led to this decline in demand and what we can expect to see in the future.

The demand for trucking: Then vs. now

The need for trucking has, for the most part, been a significant pillar in the foundation of our country. Now, as the demand for trucking is slowly dwindling, industry experts wonder what the future holds for the trucking industry.

In the Cass Freight Index, the demand for domestic shipping increased 0.6% in March from the prior year (2021); the percentage is also a 2.7% increase from February. At the end of this year’s first quarter, the creeping growth rate shows Cass Information Systems Inc. that the freight industry is clearly slowing down. 

The trucking industry recently experienced historical highs when it comes to freight rates, but those numbers seem to be decreasing as shipping demand and available capacity reach an equilibrium. For example, according to Bank of America, dry van spot rates (excluding fuel surcharges) are down 27% in the past month and 37% since December 2021. The analysis from Bank of America also shows that shipping rates have dropped to their lowest point since July 2020.

Why is the demand for trucking declining?

Over the years, the trucking industry has proven to be a reliable gauge for the U.S. economy’s prosperity or lack thereof. It’s simple math, really—when consumer spending declines, companies purchase less, and, as a result, business in the trucking industry dwindles. 

Since 1972, the trucking industry has faced 12 industry recessions, out of which six led to larger economic issues. Now, as the Federal Reserve attempts to diminish inflation, there are growing concerns surrounding another recession that would impact both the trucking industry and the overall economy. 

Cass Freight Index Report

These concerns led policymakers to raise shipping rates by a quarter-percentage point and promise half-point increases starting in May. This increase has caused freight volumes to slow. Since March, the Cass Freight Index shows shipment components are up 0.6% y/y, but this is significantly less than the 3.6% y/y growth the industry saw in February.

Other shipment component stats include:

  • Although the shipments component rose 2.7% from February, the overall seasonal pattern was still 1.0% lower.
  • If the Cass Freight Index used a normal seasonal pattern from March to predict shipment components for April and May, we would see an approximate 3% y/y increase in April and a 3% y/y decrease in May. 
  • The year-over-year shipment growth decreased to 0.4% in the first quarter of 2022 from 4.3% growth in the fourth quarter of 2021.
Image Credit: cassinfo.com

The changes to shipping rates have Wall Street traders predicting a 100% chance of a half-point rate increase at the beginning of May. If they are correct, this increase would be the first time the U.S. central bank has raised federal funds by 50 basis points since 2000. 

While some economists believe the actions of the Federal Reserve are too late, others are concerned that stabilizing prices too quickly could trigger a wide economic recession since higher interest rates force consumers and businesses to reduce their spending.

What could this mean for the economy?

Since Class 8 vehicles move around 72% of all freight, and approximately 2 million Americans work as truck drivers, a recessionary period could be detrimental. 

Suppose industries such as retail, housing, and lumber predict needing fewer heavy-duty trucks for shipping. In that case, the trucking industry would be plunged into a recession. This downturn could lead to many businesses going bankrupt, thousands of people across affected industries losing their jobs, and American families severely disrupted. Thus, leading to a nationwide economic crisis.

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How Drivers Can Avoid Drug and Alcohol Violations

In 2020, the Federal Motor Carrier Safety Administration (FMCSA) proposed regulations that would require state agencies to block drivers with any drug and/or alcohol violations from renewing or upgrading their commercial driver’s licenses or permits. The proposed regulations would also prevent new drivers from being issued licenses or permits. In some cases, the new rules would grant agencies the authority to downgrade a driver’s license or permit within 60 days of receiving a drug and/or alcohol violation. 

Today, a new regulation requires states to ban drivers with violations from operating commercial vehicles until the driver completes a return-to-duty process. These regulations were deemed ‘The Drug and Alcohol Clearinghouse.’ 

From their start in January 2020 to the end of March 2021, states saw an astonishing 69,100 total drug violations and 1,552 alcohol violations. In the first three months of 2021 alone, there were 14,324 drug violations and 367 alcohol violations reported, and experts anticipate these numbers to grow with each passing year.

While the FMCSA’s Clearinghouse aims to safeguard our nation’s roadways from potentially dangerous truck drivers, some drivers fall victim to violations simply because they don’t know the new laws and regulations.

Drug and alcohol violations are on the rise

As expected, reported violations saw a 10.2% increase from 2020 to 2021. In 2021, the nation’s total number of drug violations was particularly shocking, with a total of 58,215 reported.

The Drug and Alcohol Clearinghouse broke that number down even further and found:

  • 31,085 violations involving marijuana
  • 8,765 violations involving cocaine
  • 5,082 violations involving methamphetamine

In terms of alcohol violations, the Clearinghouse saw a 26.74% increase from 2020. 

Overall, the Clearinghouse found 104,840 truck drivers with at least one violation since its start in 2020. 81,052 of the drivers are still prohibited from resuming operations, and, as of January 2022, only 13,050 of them have completed the requirements for return-to-duty eligibility.

In recent years, the FMCSA has vowed to double the number of random drug tests administered. This decree requires carriers to perform random drug tests on all of their drivers, including any contracted owner-operators. While this demand was labeled as a temporary statute, it will most likely be re-instituted again and again. The FMCSA is required by federal law to increase random drug testing by 50% if the rate of positive drug tests passes the 1% threshold. This change could cost up to $70 million for approximately 2.1 million drug tests.

6 drug and alcohol traps and how drivers can avoid them

On more than one occasion, truck drivers have violated regulations concerning drugs and alcohol because they don’t know or fully understand the law. 

Trucking professionals have found six common traps to watch for, including:

1) Sleeping/Resting in the sleeper cab after consuming alcohol.

According to the safety regulation 49 C.F.R. § 392.5, a driver is not allowed to have any alcohol in his/her/their system while having “physical control” of a commercial vehicle. The general definition of physical control is: to have immediate access to the keys and your vehicle in close proximity to you. However, the exact points of what qualifies as “physical control” are not fully specified within the regulation.  

Since the fine points of “physical control” are not defined, it is better to play on the safe side and avoid alcohol consumption while on the road. The regulation also applies when taking a 34-hour restart. So, suppose you decide to consume alcohol while you’re at home or in a lodge. In that case, we recommend storing your keys in a safe location to avoid being considered “in physical control” of your commercial vehicle.

2) Failure to proceed to a testing site immediately after testing notification.

The regulation 49 C.F.R. § 382.305 orders drivers to go to a test site immediately after receiving notice of their selection for random testing.

It is imperative to do precisely that in order to avoid receiving a violation. For example, suppose you are in the process of completing a non-driving, safety-sensitive task or function (e.g., unloading a trailer). In that case, you and your fleet manager (or someone with authority) are obligated to stop your task and ensure that you reach the designated testing site promptly. A few contingencies would not be subject to violation, but you will need to review the FMCSA’s regulations to determine them.

3) Failure to report to testing while off duty.

In reference to regulation 49 C.F.R. § 382.305, the same rules apply to drivers off duty. According to the FMCSA, drivers are subject to random drug testing while at home or on vacation. If you are selected for random testing, you must immediately proceed to the designated testing site.

Regarding random alcohol testing, the regulation does not state or require drivers to submit to testing while off duty.

4) Failure to respond to a medical review official.

A medical review officer is responsible for confirming a positive drug test that has been received from a designated laboratory. To complete the confirmation, the M.R.O. must contact the driver-in-question’s employer and ask that they notify the driver to contact the M.R.O. to discuss test results promptly. This is an opportunity for the driver to offer an explanation for the positive test results or to retrieve fax or email information to forward a copy of a prescription to the M.R.O.

5) Using medication that is prescribed to someone else.

In the event a driver tests positive for specific drugs, they would automatically be banned from operating a commercial vehicle until they follow subsequent protocol. In regards to controlled substances that are only made available by prescription from a licensed medical professional, a positive test is deemed okay. However, if a driver tests positive for a controlled substance but does not have a prescription for that substance or the prescription is expired, then they are subject to violation.

6) Legal marijuana use.

If you test positive for marijuana in a random DOT-mandated test, you will immediately be banned from professionally operating a commercial vehicle until you complete subsequent protocol. This rule also applies to legal marijuana usage and/or consumption since state laws do not have the power to overrule or void drug testing results under the FMCSA’s regulations.

Treatment resources every driver should know

If you or someone you know is struggling to overcome addiction, consider treatment through an inpatient or outpatient program.

American Addiction Treatment Centers by State

For free, confidential treatment referrals and information services any time, anywhere, visit SAMHSA’s website or call their National Helpline at 1-800-662-HELP (4357).

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