During the National Motor Freight Traffic Association’s (NMFTA) public meeting in June 2019, the Commodity Classification Standards Board (CCSB) eliminated NMFC Item (Rule) 171—known as the “Bumping” Clause—and all notes for classifications referencing the Item. Item 171 permitted shippers to increase an LTL shipment’s density (by artificially increasing weight), thereby lowering a shipment’s class for rating purposes. Although “bumping” was not applicable in situations where the added artificial weight would not have resulted in cost savings, it was a rule that shippers could have implemented for cost savings in various ways. Imagine the impact of adding a few extra pounds on the bill of lading, thereby increasing the density, and resulting in a lower rating class. Moreover, if the lower class obtained from bumping fell within a pricing freight all kinds (FAK) scale, it would result in an even lower class and even greater cost savings.
The bottom line is, it is critical for shippers to understand the NMFC rules and their impacts on transportation budgets. Partner with AMTR and let us put that same knowledge to work for your company by discovering overcharges, recovering freight dollars and educating
your team on similar cost saving rules.
2 Comments:
By Maureen Tosto / 31 Jul 2019 /
Thank you so much for the information about the “Bump Rule getting Bumped”. I wonder though if carriers will still rate shipments with “as weight”. Most of the LTL rate tariffs have this calculation built in so it I can’t see it as just going away.
By Niki Bolton / 31 Jul 2019 /
Thanks for your feedback Ms. Tosto!
We agree, carriers can have similar rules or exceptions to the NMFC listed in their own rules tariff. The rule itself may be removed from the NMFC in the next supplement, but we could still see similar rules left in carrier rules tariffs, or strategic shippers incorporating an option in their pricing contracts. There are possibilities that we will most likely see play out over the next several months.
please check back with us anytime for an additional questions!