The Difference Between Auto Transport Brokers & Carriers
Hiring an auto transport company requires some due diligence and understanding of how the industry works before making a decision. The process can be daunting if you don’t know where to start or where to get accurate information. This article will cover the basics and the role that shippers, carriers, and brokers play in the process of transporting a vehicle.
One of the most important aspects to understanding the difference (and occasionally, the overlap) between an auto transport broker and a carrier is knowing the role that they both play in the industry.
What Is An Auto Transport Broker?
Auto transport brokers don’t have their own transport carriers and typically are not the companies that will transport vehicles. Brokers facilitate auto transportation by connecting customers with the carriers that offer the specific services requested. Brokers are also known as non-asset based carriers, intermediaries or third-party logistics providers.
The advantage of using a broker instead of a carrier is that you have more options because of their existing network of auto carriers. If you deal directly with an auto transport carrier, they may not have the necessary equipment required, or the necessary licensing in all the states your vehicle is transported through. A broker does the leg work of finding a carrier that meets these criteria and can sometimes get a more competitive rate by creating competition between carriers on behalf of the customer.
The downside to dealing with a broker is that there are some questionable companies in the industry. Auto transport is a multibillion dollar industry and technology, specifically the internet, has created a low barrier to entry into the business, which has led to some unethical practices.The Consumer Advisory about Auto Transporters has indicated a drastic increase in complaints against auto transport companies in recent years as a result of these practices.
What Is An Auto Transport Carrier?
An auto transport carrier is the company that owns the trucks and employs the workers that do the labor of transporting a vehicle.
One benefit of using a carrier is that you are dealing directly with the company (and maybe even the person) who will be transporting your vehicle, essentially eliminating the “middle man.”
It’s important to keep in mind that some carriers may not be able to transport an auto in certain areas since licensing and legal requirements differ from state to state. Dealing strictly with a carrier can sometimes limit your options in terms of availability, method of transport and time of delivery. Dealing directly with a carrier can also mean a higher cost because of the lack of competing bids for the service.
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Auto Transport Companies That Are Brokers and Carriers
Some auto transport companies operate as
are both brokers and carriers. These companies can transport vehicles, as well as broker a deal between a customer and a carrier, if there’s not a carrier available to handle the job.
How To Determine If A Company Is A Broker Or Carrier
The Protect Your Move website offers information about brokers and carriers directly from the Federal Motor Carrier Safety Administration, which is the organization that oversees the auto shipping industry. At the FMCSA site, you can research specific companies by state, motor carrier license number and U.S. Department of Transportation number.
You can also see if a company is a broker, carrier, or both and whether they have active or inactive status, which indicates if a company is in compliance with current insurance regulations.
Broker & Carrier Resources
What Is A Load Board? - Both carriers and brokers use what’s called a “load board” to help their business partner with the appropriate entities to get a shipment delivered as planned. This blog post explains the details of how it’s used.
Explanation Of Auto Transport Brokers - While we covered the basics of what a car shipping broker does, this Wikipedia article explains it in more detail and has information about licensing and regulation.