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  7. Linehaul
Operations

Linehaul

Definition

The primary transportation charge for moving freight between origin and destination, covering the over-the-road or mainline portion of the movement. Linehaul rates are the base rate component before the addition of fuel surcharges, accessorials, and terminal charges. Linehaul revenue is the largest single revenue source for railroads.

Related Terms

Terminal Charge

A fee applied at the origin or destination terminal to cover the cost of handling cars within a rail facility, including classification, inspection, and spotting. Terminal charges may be included in the linehaul rate or assessed separately. They reflect the cost difference between serving terminal customers versus through-move customers.

Switching Charge

A fee assessed by a railroad for the local movement of cars within a terminal, between an interchange point and a customer facility, or for reciprocal switching. Switching charges cover the cost of locomotive power, crew, and track used in the switch move. They are published in tariffs and may be assessed in addition to the linehaul rate.

Accessorial Charges

Additional fees charged by a railroad for services beyond the basic point-to-point transportation, such as reconsignment, storage, demurrage, special handling, or fuel surcharges. Accessorials can significantly increase the total cost of a shipment above the base linehaul rate. Shippers should review tariff schedules carefully to understand all potential accessorial exposure.

Fuel Surcharge

An additional charge assessed on top of the base freight rate to recover fluctuating diesel fuel costs, typically indexed to the weekly U.S. on-highway diesel fuel price published by the U.S. Energy Information Administration. Fuel surcharges are applied as a percentage of the linehaul rate or as a flat amount per car. They became standard after fuel price volatility in the early 2000s.

Rate

The charge per unit (typically per car, per ton, or per container) for transporting a commodity between specified origin and destination points. Rates may be published in tariffs or established through confidential contracts. Rate levels are influenced by distance, commodity, car type, volume, and competitive conditions.

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