There are approximately 5.9 million commercial motor vehicle drivers operating across the United States right now, according to the Federal Motor Carrier Safety Administration. Many of those vehicles contain LTL shipments, which are determined based on weight and the size of freight involved.
LTL shipments (or less than truckload) is the transportation of small freight, as opposed to parcel carriers and full truckload carriers. In addition to the overall weight involved in the commercial freight industry, rates play an integral role as well.
Recently, a measure of overall truckload linehaul rates has struck a record high and a separate gauge of intermodal shipping rates increased for the fifteenth straight time.
According to Heavy Duty Trucking, the year-over-year increase for truckload linehaul rates was 6.2% and struck an all-time record of 134.5. Numbers for this gauge have been negative 13 months in a row before finally breaking into the positive, and for the last nine months, that positivity continued and resulted in the highest percentage of all time.
“The current strength being reported in spot rates is leading us to believe contract pricing rates should keep year-over-year rate comparisons in positive territory well into 2018,” said Donald Broughton, pricing forecast analyst. “Throughout 2018, we continue to foresee oil trading in the $45 to $65 [per barrel] range and diesel in the $2.50 to $3.25 [per gallon] range.”
For LTL freight shipments, the freight is typically billed at a predetermined flat rate, but a weight-based surcharge can also be calculated for pricing in a rate-per-pound or rate-per-hundredweight measure. Per-pound rates for LTL carriers are usually less than those of parcel carriers as well.
Additionally, LTL truck carriers handle shipments of a single pallet containing multiple shrink-wrapped boxes to form one carry rather than many individual pieces of freight. Doing this reduces both costs of handling and the risk of damaging any item during LTL transit.
If you want to learn more about this industry or need assistance managing LTL shipments, contact 3PL Systems today to speak with a qualified freight broker.