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Submitted by Jack Russell on 10/03/2020

The U.S. Military accounts for 15% of America’s moving industry’s domestic and international business. The Department of Defense’s (DoD’s) program, Permanent Change of Station (PCS), contracts the support of over 950 transportation providers to conduct the moves. Among other things, the DoD covers moving expenses to include shipment of household goods (typically items associated with the home and personal effects of the service member and their dependents), privately owned vehicles (POV), commercial air travel, and temporary lodging.

 This government program is a lucrative and growing business opportunity for an automotive transportation company, including A-1 Auto Transport Inc., due to the program’s stability and industry-competitive contracts offered. While A-1 already moves POVs within the DoD, it is in the company’s best interest to expand into providing household goods transportation services, due to the increased opportunity to gain contracts and generate revenue.

 There are over 3M active-duty personnel, reservists, and civilians that the DoD employs. Of these, 650,000 employees move annually, each involving a PCS that enables military personnel to move their belongings to assignments in new locations. The program shields the service member from personally incurring the cost of moving, allowing them to hire a government approved moving and transportation company to facilitate their PCS. The DoD invests $4.3B on PCS moves annually, with an average cost per move of $6,727. This is a profitable opportunity for contracted transportation companies, as these cyclical and reliable revenue sources provide government-backed stability. Moreover, over the last twenty (20) years, these opportunities have become more profitable. As the DoD has tried to reduce the frequency of PCS moves, resulting in a 12% decrease, the PCS program has become more costly, increasing by 13%, which is an additional $500M annually.

 As a result, the cost per move increased from $5,238 to $6,727, a 28% cost per PCS increase. The change in cost makes the value of each contract more significant for the transportation provider. The government revenue source is available to be earned by national transportation vendors, such as A-1, providing timely and reliable services, including Household Goods (HHG) and Privately Owned Vehicle (POV) moves. Currently, A-1 Auto Transport competes for a limited portion of DoD’s PCS contracts, moving service members’ POV with offices near many of the nation's largest military installation clusters such as Washington D.C., the Southeast, and southern California.

 On average, a POV costs $1,288 per move, which is a $173 increase on the market average for coast-to-coast POV transportation in the United States. Given that the value of each PCS move is $6,727 and A-1 Auto only provides POV movement, it restricts the potential earning opportunity to just 20% of the total contracts available. By capping itself to POV moves only, A-1 Auto is missing out on 80% of the PCS contracts awarded by the DoD. A-1’s expansion into the home moving sector allows for earning a more considerable portion of the PCS contracts. Of the $4.3B spent by the DoD annually, $2.8B is spent on HHG movements, approximately 65% of the total DoD PCS budget.

 HHG movements include expenses associated with the packing, transporting, storing, and unpacking of home and personal items. The American Moving and Storage Association estimates the average cost of an interstate household move to about $4,300, compared to the average cost of an HHG move of $4,373. The cost comparison displays a payment constant with the industry standards, yet PCS moves are independent of economic variability. For instance, in 2009, during a major economic recession, the average HHG contract awarded by the DoD increased to approximately $4,875 with over 700,000 total moves.

 A-1 Auto’s established network of 40 terminals, experienced staff of drivers, maintainers, and logisticians, enable rapid expansion of services, resulting in increased earnings potential. With decades of experience shipping automobiles, boats, and RVs across the U.S. and internationally for the DoD, A-1 is conditioned to maneuver through the bureaucratic red-tape associated with government contracts. The existing infrastructure and automobile transportation department will shield the company against the challenges of the PCS program, such as the dense summer move cycle, customer service issues, and acquiring last-minute resources.

 Moreover, A-1 Auto’s reputation for safe and reliable shipping addresses the issues of late deliveries, occurring 47% of the time and damaged household belongings, occurring 21% of all domestic moves. These moving delays and damages cost the government up to $50,000 per claim. Offering a solution to these issues by increasing the scope of service offerings is sure to make the A-1 a favorite of Transportation Command, the DoD’s organization responsible for awarding contracts. There are speculations that the DoD PCS contracts may become less profitable in the future.

 While the U.S. Government is attempting to reduce costs associated with PCS moves by increasing the minimum time DoD service members spend at one duty station before being eligible to move again, this change is unlikely to happen anytime soon, if at all. In 2015, the United States Government Accountability Office (GAO) published a study where they analyzed the associated costs and move data, only to conclude that the DoD needed to ensure more accurate and complete reporting of personnel movement data. As of 2019, the Army Secretary, Mark Esper, looked to standardize all continental U.S.

 tours and most overseas tours to 36 months in an attempt to “reduce PCS moves;” however, no concrete or unified plan has been put into action. A reform to the DoD personnel management strategy that significantly puts a dent on the PCS moves would require a program akin to the British Regimental System, which keeps a large portion of service members in the same location for the duration of their career. This approach would greatly diminish the ability of the private sector to take advantage of opportunities associated with PCS.

 Major reform in the DoD personnel management strategy is unlikely, as the DoD has been committed to the current methodology since 1957, and is focused on the diversity of opinion in organizations, instead of the economic advantages of service member geographic stability. It is in the interest of auto transportation companies to maximize opportunities to gain contracts related to the PCS process. A-1 Auto Transportation Inc. has the opportunity to increase profits by expanding into the HHG transportation services. With this expansion, the company would not only become more profitable but also more resistant to changes in the economy.

Submitted by Jack Russell on 10/03/2020


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Testimonial
Mylene Rutllant
It’s my number one pick in auto shipping to this day.
★★★★★

Due to the nature of my work, I must relocate every couple of years to where my company needs me. Because of this, I’ve tested several moving and auto transport companies over the years.

And my choice in terms of auto transport has to be A1 Auto Transport. It’s in the name, but also in the quality with which they do their jobs. I’ve never had a problem with this company.

The only time my shipment was delayed was during winter when a snowstorm closed down all the major roads. And they still found an alternative and got my car delivered before roads got unstuck.

When I moved to West Virginia, they picked up my car the very day I called them. I like to think they take special care of me considering all the business I’ve sent them. I’ll continue to support A1 Auto Transport. It’s my number one pick in auto shipping to this day.

Testimonial
Luis Rodriguez
You have my full support and recommendation!
★★★★★

I considered selling my car when I moved to Washington. It was old and rusty, but I grew attached to it. So, I called a couple companies to transport it to my new home, but they both fell through.

The first one couldn’t decide on a schedule. He would constantly change the pickup date till I got frustrated and canceled. The second was insufferable, very rude on the phone, even worse in person.

They started picking a part my car asking me why I still have it. If that’s their opinion of my vehicle, how can I trust they’ll take care of it? If something happened midway, why wouldn’t they just blame it on the car instead of paying up?

So, I cancelled this company as well and turned to A1 Auto Transport. From the get go, they were very different from my past options. Their website was very professional and up to date, full of useful information. I requested a quote using their online form, and I got an email response within an hour. Surprisingly fast!

If I didn’t know any better, I would’ve thought they were lacking customers, but the email spoke for itself. In just one email, everything I needed to know was there, including a contact number I could use to get more information or confirm the transport.

I called and got things rolling. I was very pleased with the driver. He followed standard procedure and represented his company well. Can’t remember his name, but props to him!

The car arrived in Washington 6 days later in excellent condition. From what I understand, the transport was delayed a bit by a storm, but since the time window was 4-6 days from the beginning, I don’t really care. You have my full support and recommendation!

Testimonial by Cristine Benoit
Cristine Benoit
I can safely say this is a legit company that will get the job done.
★★★★★

There are a lot of options for auto transport these days, which surprisingly makes it harder to find a good company. I received more than 10 offers to ship my car, but I couldn’t decide on any of them.

After doing some research, I got even more worried reading about all the scams and accidents that can happen. But, I have work to do and couldn’t afford to drive my newly purchased Mini Cooper all the way to Virginia.

Fortunately, I made the right choice with A1 Auto Transport. They are very good at their jobs. I spent more than an hour drilling Joe with various questions, and he never once lost his patience. He saw I was interested, so he bore with me until I was satisfied. The driver was also very courteous and my car was intact on arrival. I couldn’t have asked for more.

By the way, the price we first agreed on stayed the same. There were no delays or unexpected “surprises.” I can safely say this is a legit company that will get the job done.

Testimonial
David Osallo
We give A1 Auto Transport a big 10 out of 10!
★★★★★

We give A1 Auto Transport a big 10 out of 10! We chose them to move our car from California to Vermont, since we needed professionals.

We were abroad during the transport, so the transport was a bit tricky. The driver had to pick it up from storage on short notice and get it to its destination within at most 10 days. I was happy to note it arrived sooner. We got it 3 days early, right when we got home to pick it up. It made getting around way easier. Awesome service!

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A-1 Auto Transport is a disclosed agent for the following shipping companies:

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