Final answer:
If a shipper states an incorrect class on an LTL shipment, it can result in adjusted shipping charges, shipping delays, and audits of past shipments. Carriers inspect and re-classify shipments if necessary, potentially leading to additional fees or fines for the shipper. Accurate classification is crucial to prevent these issues.
Step-by-step explanation:
Consequences of Incorrect Freight Classification
When a shipper states an incorrect class on a less-than-truckload (LTL) shipment, it can have several consequences. Freight class is determined by the National Motor Freight Traffic Association and affects shipping rates due to factors such as density, stowability, handling, and liability. If the freight class is incorrect, this can lead to a number of issues including:
- An adjustment in shipping charges after the shipment is inspected and the correct class is determined, often leading to a higher cost if the correct class is higher than the one declared.
- Delays in shipping as the correction needs to be made and potentially new paperwork to be processed.
- Audits on past shipments which can result in additional charges if other misclassified shipments are discovered.
Transportation carriers routinely inspect shipments and will re-classify the freight if they find a discrepancy. This can lead to the shipper being billed for the difference if the correct classification is higher. In some cases, additional fees for re-classification and administrative charges may also be applied. Consistently misrepresenting the freight class can lead to the carrier imposing a fine or even refusing to ship the shipper's goods.
For these reasons, it's crucial for shippers to accurately determine and state the freight class of their shipments to avoid these potential problems.