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Investigation of Methodologies Used by Less-Than-Truckload (LTL) Motor Carriers to Determine Fuel Surcharges

Researcher(s)

Principal investigator:

Project status

Completed

Start date: 04/01/06
End date: 06/30/07

Publications

Project webpage: http://www.ctre.iastate.edu/mtc/projects/fuelsurcharge.htm

Report: Investigation of Methodologies Used by Less-Than-Truckload (LTL) Motor Carriers to Determine Fuel Surcharges (207 kb pdf) August 2007

Tech transfer summary: Investigation of Methodologies Used by Less-Than-Truckload (LTL) Motor Carriers to Determine Fuel Surcharges (89 kb pdf) Aug 2007

Sponsor(s)/partner(s)

Sponsor(s): Midwest Transportation Consortium

About the research

Abstract: Fuel surcharge policies are utilized by transportation companies to transfer the expense associated with fuel prices to their customers. As fuel surcharges have become a significant portion of the expenses on transportation invoices, an increasing number of shippers are expressing more interest in these policies. The objective of this study is to discover how less-than-truckload (LTL) carriers develop and utilize fuel surcharge policies to recover their fuel expenses. Thirty-nine top LTL carriers were called on to explain their perspectives and methodologies with regard to fuel surcharge policies. Part-to-whole qualitative analysis was conducted to summarize responses from a standardized interview protocol. In addition, 25 published fuel surcharge policies were obtained and analyzed to explore the disparities among LTL fuel surcharge policies. Findings show that, while carriers were reluctant to discuss their fuel surcharge development, in practice there were two primary methodologies that left all carriers with very similar fuel surcharge policies.