As a Master Shopaholic of everything solar, I have become increasingly frustrated at my inability to come up with good shipping deals for my customers. Trusted freight brokers who formerly offered a wide selection of price points for a particular shipment, now offer a very limited range of price points from fewer companies. Major freight companies with whom I’ve work for years have noticeably increased their prices, so much so that I keep on shopping.more often than not.

What’s driving the increase?

There are a few things going on in the market place and in the trucking industry that are driving the increases.

Certainly, the ELD Rule has increased carrier labor costs. The ELD mandate rules that in 2019, nearly all U.S. commercial motor vehicles must have an electronic logging device (ELD) in order to track drivers’ hours of service and ensure they comply with labor regulations.

Market consolidation is also contributing to increased costs. Ninety percent of all LTL freight is owned and operated by just 25 LTL providers with the remaining 10 percent owned by hundreds of smaller, regional or local carriers.

Other factors include a shortage of drivers, a mandated decrease in hours of service (HOS) rules. and a strong U.S. economy.

The rise of ecommerce is also playing a large role in the increased demand for LTL service. Products that were never ordered online a few years ago, like furniture, have now become commonplace for ecommerce. In short, LTL freight demand is surging and straining the market.

Shopping For Best Shipping Cost Still Pays

Although the “low price” for any given shipment has increased, shopping for the best price still pays off. For example, a recent shipping quote for 40 solar panels (815 lbs.) – Los Angeles to Sacramento – was initially quoted at $637.A virtual shopping trip produced a price of $360 – Definitely a worthwhile endeavor.

Sources: “LTL Freight rate outlook”: https://www.supplychaindive.com/news/ltl-freight-rate-outlook-what-to-expect-in-less-than-truckload-shipping-ra/543460/
Leah Palnik: “Factors Contributing to the 2018 LTL Rate Increases” Partnership.com