Trucking Industry Foresees Modest Improvement

Despite up-and-down numbers over the last quarter, U.S. freight volumes are slowly improving. Tonnage is still down over last year but the gap is narrowing as 2009 comes to a close. The American Trucking Associations (ATA) believes the trucking industry is on the road to recovery.

The ATA advance seasonally adjusted for-hire truck tonnage index decreased 0.3% in September, after increasing 2.1% in both July and August. ATA argues that the recovery will be moderate and choppy and that the industry shouldn’t be alarmed with the “miniscule” drop in September.

Business researchers appear to generally concur with the ATA’s analysis and cautioned the industry “not to get too excited” over the monthly numbers through the last quarter of 2009 and first quarter of 2010. They project a second quarter 2010 recovery due to dropping inventory levels.

The trend towards industry recovery is not yet translating into higher freight rates though. Businesses are still in belt-tightening mode and are continuing to operate a reduced inventory levels, even as consumers are beginning to buy again. The lack of freight demand has created excess capacity, which has resulted in carriers dropping freight pricing to compete for the little business out there.

While the drop in freight rates has been damaging to the freight industry, this competition has been a boon for Freightquote’s customers – those companies which are still shipping. As rates drop, Freightquote’s online freight management system helps shippers find the best shipping solution available – from the best rate to the best delivery options – all from reputable carriers.

As the economy recovers and rates inevitably rise again, Freightquote is the best place for shippers to stay on top of the rate changes. Whatever the increase, Freightquote’s shippers are assured of the lowest prices as a result of its experience, relationships and technology. These factors – and the efficiency of Freightquote’s system – will assist its shippers in weathering the economic storm.

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The Basics of Freight

Who knew that freight could be so complex? The freight industry is a multi-faceted and ever-changing. Navigating the intricacies of the shipping world can be an overwhelming task. Fortunately for shippers, Freightquote.com handles the details for you. Shippers don’t have to worry about missing something – a cheaper option, a legal issue, a strange surcharge – because Freightquote takes care of everything. And there is a lot to take care of.

“Freight” is the transfer of goods, generally on a commercial level. Goods are categorized in several different ways before a shipping channel is determined.

Things to consider about the goods at the beginning of the freight process:
·    The nature of the goods – household goods, grain, hazardous materials, liquid, large machinery, etc.
·    Size and quantity of the goods
·    Time of delivery – do you need it there next month, next week or next day?
·    Packaging – can the goods be boxed, crated or pallet-ized?
·    Destination – domestic, international, intra-state?
Freightquote’s shipping experts can guide you through this process if you are unsure of any of these. When you have a full picture of what type of shipment you’re dealing with, Freightquote will be able to make a recommendation as to what means of transport should be used. And there are several to choose from:
Parcel carriers (like UPS and FedEx) deliver small packages and envelopes. Often even larger household goods can be economically shipped via a parcel carrier.
Less-than-truckload or LTL freight is available for relatively small shipments of multiple items. In LTL freight, a 28 foot container (or trailer) holds shipments for several different shippers, consolidated into one shipment by destination, class and delivery time requirements.
Truckload (TL) freight is available for any shipment larger than about 15,000 pounds. The most economical way to ship these large loads is via its own truck. TL shipments generally deliver on exactly the same trailer as they are picked up on. TL shipments can also utilized specialized equipment like refrigerated trailers, liquid containers and flatbed decks.
Air freight – shipping via airplane – is available for just about every type of freight that can be shipped LTL – at a quicker pace and a higher rate.
Rail freight is the shipment of goods via railway. This is an economical means of transport for almost anything that could be otherwise shipped LTL or TL. Often, rail freight is part of an intermodal process in which the freight starts and ends on the back of a truck – with other modes of transport in the middle.
Ocean or barge freight is available when freight must traverse a body of water. Large ocean-going vessels move freight intercontinentally, usually in corrugated containers. Domestically, certain freight moves on major river channels such as the Mississippi.
After the mode of transport is chosen, the shipper must then wade through pricing, tariffs, discounts and surcharges before even booking a shipment.  Fortunately though, shippers using Freightquote don’t have to deal with this hassle. Freightquote’s web-based freight management system allows shippers to compare bottom line freight rates “apples to apples” with the touch of a button. Instantaneous freight quotes are just the start though – as the same system allows a shipper to book a load, create legally-required shipping documents, track a delivery and pay a shipping invoice.

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Union Pacific Freight Lines May Be Used for Super Bowl 2011 Passengers

Many people probably don’t realize that, unlike roads, rail lines are actually owned by individual railway companies. In some circumstances, the rail companies lease those lines to other rail companies for limited use. An interesting deal between Union Pacific and the Super Bowl host committee in Arlington, Texas may be struck to allow freight rail lines to be used by passenger trains on one day only – Super Bowl Sunday 2011.

The company has apparently been in talks with committee officials for several months over this rare agreement. One of UP’s major freight lines runs from Fort Worth through the middle of Arlington and past Dallas. If a deal is struck, passengers headed to the Super Bowl at Cowboy Stadium could leave from rail stations in Fort Worth or Dallas. They would then be dropped off near downtown Arlington, less than a mile from the stadium. Shuttle buses would then take them to the game.

UP, one of the nation’s busiest freight railroads, does not operate passenger rail service at all. Super Bowl host committee members, hoping to get more than 100,000 out-of-town visitors to the game, want to run passenger cars along the freight lines for the game, easing the transportation crunch on game day.

Arlington is America’s largest city without mass transit. Cowboys fans are limited to driving, taking shuttles from a Fort Worth rail station, or using a taxi, which can take hours.

Liability and union issues remain unresolved as do issues related to how UP’s freight will move through the area during the 12-hour agreement window.  Some of the freight UP normally moves through the region would be transferred to another local rail line. That line, however, has less capacity than UP’s lines, so a resulting, albeit brief, slowdown could affect freight movements all the way to California.

Because of the high demand on their freight lines, the nation’s largest freight railroads have not traditionally been quick  to share their lines with passenger trains. Such requests have become more common though, especially as more local governments have expanded light rail and commuter rail service.

Because interstate passenger rail travel is not nearly as popular across the U.S. as in years past, many Americans are surprised to find that rail freight is still a very busy industry. Increased fuel prices and renewed attention to environmental issues continue to make rail freight a popular choice for shippers.

There are many rail freight companies to choose from and complicated intermodal issues to resolve when using rail freight. Freightquote.com can simplify the process though through its comprehensive online freight management system. Every aspect of intermodal freight shipment can be handle quickly and efficiently via Freightquote’s web-based quoting and booking system. Tracking and payments are also all a part of Freightquote’s solution.

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What Does F.O.B. Mean in the Freight Industry?

Many people have seen the acronym F.O.B. in shipping documents and never known what it meant. Even those in the shipping industry often are confused as to its true meaning.

F.O.B. stands for “free on board.” There, now you know.
But what the heck does that mean? The FOB designation is used to indicate when liability and ownership of goods is transferred from a seller to a buyer. When used with an identified physical location, the designation determines which party has responsibility for the payment of the freight charges and at what point title for the shipment passes from the seller to the buyer
In international shipping, for example, “FOB [name of originating port]” means that the seller (consignor) is responsible for transportation of the goods to the port of shipment and the cost of loading. The buyer (consignee) pays the costs of ocean freight, insurance, unloading, and transportation from the arrival port to the final destination. The seller passes the risk to the buyer when the goods are loaded at the originating port.
“FOB” can be used in four different ways in shipping documents:
1) FOB [place of origin], Freight Collect
2) FOB [place of origin], Freight Prepaid
3) FOB [place of destination], Freight Collect
4) FOB [place of destination], Freight Prepaid
The first part of the designation determines where the buyer assumes title of the goods and the risk of damage from the seller (either at the moment the carrier picks the goods up for delivery or at the time of actual delivery). The second part indicates responsibility for freight charges. “Prepaid” means the seller has paid the freight; “collect” indicates the buyer is responsible for payment.
It is important for shippers to understand FOB designations in damage situations. Some receiving docks will refuse delivery of obviously damaged goods, rather than accept with a damage notation for future claim against the carrier. However, a shipment designated FOB Origin technically belongs to the buyer/consignee at the time that it is shipped. So, the consignee would be refusing delivery of goods it legally owns and bears the risk for. The seller has no legal reason to accept those goods back and the return shipment could possibly result in additional damages.
If all of this seems too confusing to follow, consider allowing Freightquote.com to handle the placement of your shipment for transport. The legal issues raised in FOB designations are old hat to Freightquote’s experienced customer service agents – the right designations (and, on rare occasions, any damage claims) can be managed quickly and efficiently by the Freightquote team.

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Railway Freight in the U.S.

Freight railroads reportedly move 42 percent of American freight and are therefore critical to the United States economy. In addition to connecting businesses across the country, freight rail also contribute billions of dollars each year to the economy via their own purchases, jobs and taxes.
U.S. rail companies are largely used to carry industrial goods like coal, chemicals, non- metallic minerals such as phosphate rock, sand, and crushed stone and gravel, food products, steel, lumber, paper, motor vehicles and scrap materials.

Freight railroads operating in the U.S. fall into five categories: Class I, regional, local linehaul, switching & terminal carriers and Canadian carriers.

·    Class I railway companies are the largest railroads, accounting for 70% of industry mileage and 92% of industry revenue. Class I railroads include Burlington Northern and Santa Fe, Norfolk Southern, CSX and Union Pacific. Class I carriers typically operate across many different states and usually concentrate on long-haul, high-density traffic lanes.

·    Regional railroads are slightly smaller, linehaul railroads. Regional railroads typically operate 400 to 650 miles of rail and serve two to four contiguous states. Most regional railroads employ between 75 and 500 workers.

·    Local linehaul rail carriers operate fewer than than 350 miles and earn less than $40 million per year. These rail companies typically perform point-to-point service over short distances. Most operate less than 50 miles of road and serve only a single state.

·    Switching and terminal (S&T) carriers are railroads that perform pick-up and delivery services within a specified area for linehaul carriers. In some cases, S&T carriers connect load traffic between linehaul railroads.

·    Finally, the two major Canadian freight railroads Canadian National Railway and Canadian Pacific Railway have extensive U.S. operations.
Although it may be surprising to the layperson, railroads move 42 percent of intercity freight in the U.S., more than any other mode of transportation. This share has increased slightly over the last decade because railroad freight has been lower than other modes of freight transport. Despite the large volume of freight carried, the revenue realized by freight rail companies has been only about 10% of all domestic freight revenue.

Over the past ten years, intermodal traffic – the movement of trailers and containers by rail and at least one other mode of transportation, usually trucks – has been the fastest growing rail traffic segment.  Rail intermodal, because of the use of containers, transports a wider variety of goods than traditional rail freight. More consumer products are logging time on the rails as a result. And manufacturers and retailers are enjoying the cost savings attributable to the use of the rail component of intermodal transport.

Whether a shipper needs rail freight or intermodal transport, Freightquote can quote, book and track any shipment that can travel over the rails. If intermodal services are necessary, Freightquote can even consolidate billing so that the shipper receives and pays only one invoice. Efficiencies and savings are realized at every step of the Freightquote freight shipping process.

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