 | The examples and perspective in this article deal primarily with the United States and do not represent a worldwide view of the subject.(June 2015) |
An auto transport broker is a type of cargo broker that specializes in the shipping and transportation of vehicles. Most vehicles shipped in the U.S. are cars and trucks, but many brokers handle boats, RVs, motorcycles and other types of vehicles as well. Auto transport is classified as "specialized freight trucking" under NAICS code 484230.
An auto transport broker is part of the personal vehicle freight business industry chain. In the U.S., these broker companies must have proper licensing and authority from the FMCSA to be allowed to broker vehicles for customers. The individual or business that needs to move a car or other vehicle is the shipper; the shipper contacts a broker to have their vehicle shipped or transported. Once a broker is booked, the broker's job is to find a carrier, which is the individual or company that actually employs drivers and operates the car transport equipment.
Brokers are employed because they have access to freight load boards, where they can post the job and find carriers that have transportation resources in the area. They can also get lower shipping prices by getting competing bids by different carriers. [1] However, brokers and carriers are not always separate entities - a number of auto transport companies handle both brokerage and transport.
The US Department of Transportation keeps statistics on cargo shipments, showing over $651 billion worth of motorized and other vehicles (including parts) moved by truck in 2007. Of that number, $452bn of cargo was moved via for-hire truck. [2] Official statistics about the size of the secondary auto transport market, number of commercial-size car carrier vehicles on the road and number of vehicles shipped aren't kept by the DOT.
With the advent of the Internet, the auto transport industry has seen an influx of new brokers, attracted by the low cost of starting a brokerage business online. While this encouraged greater competition and lower costs in the industry, government agencies have also seen a "dramatic increase in complaints against auto transporters and auto transport brokers" due to Internet fraud. [3]
Auto transport brokers in the USA are subject to government licensing. The candidate must obtain an Operating Authority number from the Federal Motor Carrier Safety Administration by filling out a form on the FMCSA website. [4] [5] There is a small application processing fee. Brokers are also required to obtain a bond. Known as a Freight Broker Bond, it exists to cover losses by the motor carrier, in case the broker commits fraud or other lapses. Prior to 2012, the minimum bond was $10,000, although many brokers chose to obtain higher amounts.
The Moving Ahead for Progress in the 21st Century Act, [6] signed by President Obama on July 6 of 2012, introduced a number of new regulations for auto transport brokers. The chief among them is raising the minimum broker bond from $10,000 to $75,000. The new provision goes in force on October 1, 2013, and has applied to all existing brokers retroactively. [7]
The BMC-84 Freight Broker Bond is paid for on an annual basis. The freight broker bond cost is figured as a percentage of the bond amount depending on
Other rules include:
The Association of Independent Property Brokers & Agents (AIPBA), a property broker trade group that claims 1,400 members, [10] has petitioned and lobbied against higher bond requirements when these have been proposed in the past, [11] and has harshly criticized the new law. The founder & president of AIPBA, James Lamb, has called the law a lobbyist-driven attempt to "eliminate small brokers from the market" and establish an oligopoly that charges customers more and pays carriers less. [12]
The National Association for Minority Truckers (NAfMT) [13] has also come out against the higher bond requirements. NAfMT CEO Kevin Reid called the $75,000 bond an "unreasonable barrier to entry for would-be entrepreneurs." He also spoke out against the new restrictions on owner-operators brokering out excess freight. The NAfMT has joined efforts by AIPBA to repeal the stricter surety requirements. [14]
Other industry associations have been supportive of the law. The Owner-Operator Independent Drivers Association (OOIDA), a group that represents independent trucking owner-operators, has been a key force behind the new regulations. While the final rules in MAP-21 fell short of the OOIDA's wishes, Todd Spencer, executive vice president of the organization, praised them as a "win-win" for truckers and legitimate brokers. [15]
The Transportation Intermediaries Association (TIA), [16] a major third-party logistics trade organization, has also advocated for the new FMCSA regulations through its lobbying arm TIAPAC as a way to protect motor carriers from both incompetent and unscrupulous brokers. TIA board member Ken Lund acknowledged that the new bond may be difficult for smaller brokers to pay, but defended it as "reasonably priced" and useful to prevent fraud. [17]
A truck or lorry is a motor vehicle designed to transport freight, carry specialized payloads, or perform other utilitarian work. Trucks vary greatly in size, power, and configuration, but the vast majority feature body-on-frame construction, with a cabin that is independent of the payload portion of the vehicle. Smaller varieties may be mechanically similar to some automobiles. Commercial trucks can be very large and powerful and may be configured to be mounted with specialized equipment, such as in the case of refuse trucks, fire trucks, concrete mixers, and suction excavators. In American English, a commercial vehicle without a trailer or other articulation is formally a "straight truck" while one designed specifically to pull a trailer is not a truck but a "tractor".
In transportation, freight refers to goods conveyed by land, water or air, while cargo refers specifically to freight when conveyed via water or air. In economics, freight refers to goods transported at a freight rate for commercial gain. The term cargo is also used in case of goods in the cold-chain, because the perishable inventory is always in transit towards a final end-use, even when it is held in cold storage or other similar climate-controlled facilities, including warehouses.
A commercial driver's license (CDL) is a driver's license required in the United States to operate large and heavy vehicles or a vehicle of any size that transports hazardous materials or more than 15 passengers.
A truck driver is a person who earns a living as the driver of a truck, which is commonly defined as a large goods vehicle (LGV) or heavy goods vehicle (HGV).
A freight forwarder, or forwarding agent, is a person or a company who, for a fee, organizes shipments for the shipper by liaising with carriers. A forwarder does not move the goods but acts as an agent in the logistics network.
Freight companies are companies that specialize in the moving of freight, or cargo, from one place to another. These companies are divided into several variant sections. For example, international freight forwarders ship goods internationally from country to country, and domestic freight forwarders, ship goods within a single country.
The Federal Motor Carrier Safety Administration (FMCSA) is an agency in the United States Department of Transportation that regulates the trucking industry in the United States. The primary mission of the FMCSA is to reduce crashes, injuries, and fatalities involving large trucks and buses.
In road transport, an oversize load is a load that exceeds the standard or ordinary legal size and/or weight limits for a truck to convey on a specified portion of road, highway, or other transport infrastructure, such as air freight or water freight. In Europe, it may be referred to as special transport or heavy and oversized transportation. There may also be load-per-axle limits. However, a load that exceeds the per-axle limits but not the overall weight limits is considered overweight. Examples of oversize/overweight loads include construction machines, pre-built homes, containers, and construction elements.
The Professional Truck Driver Institute (PTDI) is a non-profit organization that provides certification of training courses for drivers of commercial motor vehicles. It was formed in 1986 during the standardization of commercial driver's licensing by the Federal Motor Carrier Safety Administration in the United States. Its management was taken over by the TCA in 1996. PTDI is the first nonprofit organization to develop uniform skill performance, curriculum, and certification standards for the trucking industry and to award course certification to entry-level truck driver training courses and motor carrier driver-finishing programs.
PrePass is an intelligent transportation system (ITS) that electronically verifies the safety, credentials, and weight of commercial vehicles as they approach participating state highway weigh stations. Because they comply electronically, commercial carriers enrolled in PrePass are authorized to bypass these facilities rather than pull in for manual inspection.
Hours of Service (HOS) regulations are issued by the Federal Motor Carrier Safety Administration (FMCSA) and govern the working hours of anyone operating a commercial motor vehicle (CMV) in the United States. These regulations apply to truck drivers, commercial and intercity bus drivers, and school bus drivers who operate CMVs. These rules limit the number of daily and weekly hours spent driving and working, and regulate the minimum amount of time drivers must spend resting between driving shifts. For intrastate commerce, the respective state's regulations apply.
The trucking industry serves the American economy by transporting large quantities of raw materials, works in process, and finished goods over land—typically from manufacturing plants to retail distribution centers. Trucks are also used in the construction industry, two of which require dump trucks and portable concrete mixers to move the large amounts of rocks, dirt, concrete, and other building materials used in construction. Trucks in America are responsible for the majority of freight movement over land and are tools in the manufacturing, transportation, and warehousing industries.
An electronic on-board recorder (EOBR) is an electronic device attached to a commercial motor vehicle, which is used to record the amount of time a vehicle is being driven. This is similar to the tachograph, and is the American equivalent of the digital tachograph used in Europe. Trucks in the European Union are required to have digital tachographs installed, and are securely monitored by government agencies. However, in Europe, the new digital tachograph which is considered secure, can be tricked with a round magnet placed by drivers over the connection to the transmission box. Usually they tie a rope to that magnet, and with a simple pull, the magnet will disengage and will show that the driver started moving about half an hour ago . The majority of carriers and drivers in the United States currently use paper-based log books. On January 31, 2011, the U.S. Federal Motor Carrier Safety Administration (FMCSA) proposed a rule requiring Electronic On-Board Recorders for interstate commercial truck and bus companies. The proposed rule covers interstate carriers that currently use log books to record driver's hours of service. The proposal would affect more than 500,000 carriers in the United States and carriers that currently use time cards would be exempt.
The motor carrier safety rating is an evaluation given to an interstate commercial motor carrier by the Federal Motor Carrier Safety Administration (FMCSA).
A specialized set of jargon describe the tools, equipment, and employment sectors used in the trucking industry in the United States. Some terms may be used within other English-speaking countries, or within the freight industry in general. For example, shore power is a term borrowed from shipping terminology, in which electrical power is transferred from shore to ship, instead of the ship relying upon idling its engines. Drawing power from land lines is more efficient than engine idling and eliminates localized air pollution. Another borrowed term is "landing gear", which refers to the legs which support the front end of a semi-trailer when it is not connected to a semi-truck. Some nicknames are obvious wordplay, such as "portable parking lot", in reference to a truck that carries automobiles.
The American Trucking Associations (ATA), founded in 1933, is the largest national trade association for the trucking industry. ATA represents more than 37,000 members covering every type of motor carrier in the United States through a federation of other trucking groups, industry-related conferences, and its 50 affiliated state trucking associations. Former Governor of Kansas Bill Graves was replaced by Chris Spear as the ATA's president and CEO in July 2016.
People who are driving as part of their work duties are an important road user category. First, workers themselves are at risk of road traffic injury. Contributing factors include fatigue and long work hours, delivery pressures, distractions from mobile phones and other devices, lack of training to operate the assigned vehicle, vehicle defects, use of prescription and non-prescription medications, medical conditions, and poor journey planning. Death, disability, or injury of a family wage earner due to road traffic injury, in addition to causing emotional pain and suffering, creates economic hardship for the injured worker and family members that may persist well beyond the event itself.
Public Law 113-45 is a U.S. federal law that requires that the Federal Motor Carrier Safety Administration go through the standard rulemaking proceeding, allowing comment from the public and the trucking industry, before it sets any requirements for truck drivers related to sleep apnea. It was introduced in the United States House of Representatives during the 113th United States Congress and was signed into law by President Barack Obama in October 2013.
A freight broker bond must be obtained by freight brokers and freight forwarders in the United States in order to obtain or renew their license.
A freight broker is an intermediary between a shipper and a freight service provider. Freight brokers can specialize in certain types of freight, such as equipment hauling on lowboys, oversize, bulk tanker, auto, or other types of freight transportation.