Trucking rates, like any open market, are a collection of data points that reflect what trucking companies are willing to accept loads for a given day. Generally, when people refer to trucking rates, they are talking about truckload (LTL is priced differently: per pound based on class).
Trucking rates are generally described as "spot" or "contract."
To make your life easier, we attempt to break these down.
Before we get started, here are a couple of terms to know about truckload rates:
Linehaul rate: The rate quoted for the load, usually reflected in dollars and pennies per mile.
Fuel surcharge: An index-linked surcharge added to the linehaul rate based on the current price of fuel. The fuel surcharge is normally calculated based on the date a load picks up.
Accessorials: Additional fees for services added to the linehaul and fuel surcharge rate, based on activity incurred by a trucking company that is not based on distance or fuel. Common accessorials include detention, multi-stop charges, driver unload, lumper fees, or in-transit dwell.
Truckload Rate Descriptions:
Trucking spot rates: The term "spot" means a rate that is offered from a trucking company to a broker or shipper for a specific load on a given day. Spot can refer to a quote for a single load or a quote for a set of loads over a specific short period of time.
In the spot market, rates are reflected in rate per mile (RPM), plus any accessorials that occur. Fuel surcharge is usually baked into the spot rate, since the fuel costs are known and fuel cost is unlikely to change drastically between the time the quote is given and the load is transported.
Oftentimes, brokers and carriers will agree to "all in" rates for a spot quote which include all costs associated with the load. Carriers should be cautious when agreeing to this, as things tend to happen in trucking and not having an accessorial schedule can come back to bite the carrier as they will be stuck with performing all of the known and unknown load requirements, but not able to bill the broker for these fees.
Trucking contract rates: The term "contract" means a rate that is given to a shipper or broker and will be honored by a trucking company beyond a load or project for an extended period of time.
The term "contract" can be misleading and normally does not mean a binding rate agreement between a carrier and broker or shipper. In other words, "contract" just means that the rate is fixed and does not have to be negotiated on each load or project.
In recent years, the terms "committed rates" or "paper rates" have started to appear, which are more reflective of the nature of trucking contracted rates. "Committed" refers to the fact that the carrier and shipper have committed to a rate, but can't enforce the contract rate in court.
In the contract market, rates are reflected in rate per mile (RPM), plus fuel surcharge and accessorials.