The productivity effects of truck size and weight policies: Final report

Abstract

While previous studies have indicated that increases in truck size and weight limits could improve motor carrier productivity, the question of whether or not freight shippers will also benefit has not been adequately addressed. It is generally assumed that competitive conditions in the motor carrier industry will result in cost savings being passed to shippers in the form of lower freight rates. Transportation costs, however, are only one component of shipper total logistics cost. Warehousing cost, inventory holding cost, order processing cost, and other categories of business logistics cost may also change as a result of the less frequent but larger shipments typically associated with the use of longer combination vehicles (LCVs). If switching from single trailer truckload shipments to LCVs causes shipper non-transport logistics costs to increase more than the savings available from lower freight rates, then productivity gains may be lost to the firm and the economy as a whole. This research was undertaken to determine the net effect of truck size and weight policy changes on shipper total logistics cost and how these effects might influence the demand for alternative tractor-trailer configurations.