Road Freight

Road transport dominates the short haul transport market for non-bulk freight such as manufactured goods, food, livestock and general freight. The advantage road transport has over other modes is its ability to supply a flexible door to door service. Road transport is also used for the distribution of goods over medium to longer distances where alternatives are not readily available and is generally the mode of choice for time sensitive freight.

Road is generally unsuited to transporting bulk commodities like coal and grain as it unable to match the efficiencies of rail and coastal shipping for transporting large commodity volumes over long distances.

The road freight industry falls into two main sectors: the ancillary sector; and the Hire and Reward sector. The ancillary sector refers to the "in-house" freight operations of firms whose main business is non- transport related. The Hire and Reward sector provides freight transport services on a contractual or "pay for service" basis and consists of freight forwarders and freight and transport operators.

Freight forwarders generally act as or intermediaries between the clients (consigners) and those that physically carry out the task. A major role of freight forwarders is to consolidate consignments of various densities in order to achieve optimum loads in terms of both maximum legal weights and volumetric capacities. Freight forwarders may operate their own truck fleet and employ their own drivers, or engage independent sub-contractor or fleet operators to provide haulage services.

Freight operators are either fleet operators or subcontractors who secure consignments on a contractual basis either directly from consigners or from freight forwarders.

For an extended discussion on the nature, challenges and trends for the road freight industry in Australia refer to the BRTE Working Paper 60: An Overview of The Australian Road Freight Transport Industry, 2003. This paper is available from the Bureau of Transport and Regional Economics website.

Source: BIRTE Working Paper 60: An Overview of The Australian Road Freight Transport Industry, 2003