Fuel surcharge explained
A national fuel surcharge is a fee charged by freight companies to cover fluctuating fuel costs. It is calculated as a percentage of the base rate and is usually added to the shipper's freight bill to cover operating costs. Fuel surcharges for LTL and trucking companies are updated weekly...usually on Tuesdays.
Most car carriers charge a "long distance" fee and a fuel surcharge (FSC). They also have many other surcharges or surcharges for additional services, but in general the FSC is only calculated based on line charges. FSC is usually a percentage of line shipping (just like sales tax) or a per-mile rate. LTL FSC is almost always %; but truck loads either way.
Each carrier builds some fuel price assumptions into their pricing model, resulting in line rates. Then, so they don't have to keep updating the whole model, they build a fuel surcharge table that (essentially) says "when the fuel price is between x and y, add z to the line freight to cover the extra fuel cost". These fuel surcharge tables usually start with the carrier's fuel price in its base model.
Where the carrier gets its fuel costs is another variable. Most of them use an internet tool provided by the U.S. government that publishes average fuel prices for gasoline and diesel in the U.S. as a whole and in different regions. Each carrier specifies which index numbers they will use in their fuel surcharge tables.
When you're dealing directly with carriers, it's important to understand how their rates and fuel surcharges work together, and when they update fuel surcharges. Did they quote you before or including the FSC? How often are interest rates right? and many more
When you use TJ chinafreight, the quotation (whether LTL or truck loading) always already includes FSC. Our LTL rates are for 7 days and our truck loading rates are for 24-48 hours. Need more explanation on fuel surcharges? We are happy to help!
