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Many LTL Carriers Lean Toward Density-Based Pricing | Transport Topics

The argument made by Levine is that LTL carriers need to consider other factors besides density.

“Density alone, we believe, does a poor job of reflecting the costs associated with the transportation of LTL freight,” he said.

To illustrate his point, Levine gave the example of two pieces of freight that have the same density — a palletized stack of boxes and a piece of construction equipment that is 9 feet long and tendered loose.

While the pallet is easily handled, the piece of construction equipment requires special handling, which increases the cost associated with shipping. By having a mechanism to account for such disparities, the NMFC “more accurately reflects the costs associated with transporting the freight than does density-based pricing alone,” Levine said.

But for many, the debate is largely settled.

“Clearly, the LTL industry is moving away from the outdated NMFC rating system,” said Sean Healy, senior vice president of transportation, international, planning and strategy at FedEx Freight.

Healy said the challenge will be to find the proper pricing method that simplifies the process for customers and LTL providers.

“FedEx Freight is committed to utilizing technology to find the right pricing solution for our customers and our business,” he said.

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Many LTL Carriers Lean Toward Density-Based Pricing | Transport Topics.

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