What Does LTL Stand for in the Transportation/ Trucking Industry?
It’s simple. LTL is an acronym for Less than Truck Load freight. Unfortunately, the simplicity stops there. There are several different perspectives as to what is actually considered LTL. Full Truck Load carriers can put anywhere from 2 to 6 different people’s shipments on a trailer and since each shipment is technically “less than a truckload” they would consider that to be LTL. There are also freight companies who do not specialize in truck loads, but rather, consolidate larger volume shipments from about 2 to 12 pallets (or about 4000 to 24000 pounds) and consider themselves LTL Carriers. Finally, the most commonly referenced LTL is shipped via “common” carriers who handle freight above what would normally ship via FedEx Ground, or UPS or U.S. Mail parcel services (about 150 pounds) to just under what would usually be considered a Truck Load at about 20,000 pounds or more than 14 pallets. LTL common carriers are also more likely to accept loose (non-palletized) cargo than the other two.
The main differences between these 3 types of LTL shipping are their general rating methods and rules: Truck Load carriers who put together a few shipments to make a full load to a certain area will most likely give you a flat rate or “spot” quote for your shipment, which is, by definition, just quoted to you on the spot when you tell them what you are shipping. These carriers are often smaller and difficult to rely on for regular shipping because matching where their trucks will be to where your freight is going is usually hit and miss with little consistency.
The (normally mid-sized) “Consolidators” will collect peoples palletized LTL freight in strategically located warehouses and build truckloads to various areas of the country. Then they will broker out the consolidated LTL as multi-delivery full loads to truck load carriers. These freight companies usually have set pricing tariffs with customers, so there is not a need to call for a spot quote on every shipment. LTL Consolidators often will charge by the linear foot of trailer space occupied or a “per pallet” rate with breaks in multi- pallet increments. For example; A tariff issued to your company from an LTL Consolidator may give you a rate of $150 per Linear Foot from Los Angeles to Atlanta for up to 10 Linear feet, then $125 for 11 to 16 feet, then $100 for 17 to 20 feet. (Plus Fuel Surcharge). The cost Per Linear Foot would, of course vary, from and to different cities and states based on distance and traffic flow in that particular lane. A price “Per Pallet” example from Los Angeles to Atlanta may look like: $300 per pallet up to 5 pallets, $250 Per Pallet for 6 to 8 Pallets, and $200, each for 9 to 10 pallets. (Again plus Fuel Surcharge and assuming pallets are standard,- not exceeding 48 inches in length or width).
Consistency with LTL Consolidators is better that Truckload carriers putting partials together, but is not always optimum, as available shipping lanes are sometimes quite limited, and they are usually not a viable option for smaller quantities of freight. In addition, you will often encounter more shipping “rules” and if any of these rules apply to your shipment (even without you knowing about it), you will likely be billed more than expected by the carrier.
The smaller shipments are, the more there are of them. That is why the LTL “Common” Carriers rule the earth :). The biggest of the big of these guys are the Freight divisions of FedEx and UPS, and YRC Freight (Formerly Yellow Freight and Roadway). Not as big, but still huge are the other national carriers who’s direct map coverage may not be as complete as YRC, FedEx Freight , or UPS Freight, such as: Old Dominion Freight Lines, Saia, or Estes-Expres to name a few. Then there the “Regional” LTL common carriers. These carriers are usually still large in size, but directly service only certain areas of the country. Oak Harbor Freight for in the Western US, New England Motor Freight for the North East, SouthEastern Freight Lines for the South (Including Texas) and Moran Transportation or Pitt Ohio for the Mid-West would be a few examples of these.
Common carrier rating sucks!! LTL pricing is based on how much weight of one of 16 shipping classes determined by the National Motor Freight Classification guide (published by the American Trucking Association) is being shipped, and the applicable to and from zip code combination. Common carrier tariffs are also LOADED with rules that the average person would need to study the industry for years to learn. Yet, next to mail and parcel shipping, common carrier LTL shipments are the most common nation wide!! Explaining common carrier rating is an article (if not a full course), in and of itself, for a different day. But until then, I am available to answer any questions regarding LTL Freight.
Thanks again for reading!