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innovations or changed situations brought about by the Act, The
Motor Carrier Act of 1980 and Commission decisions are also being
considered to the extent possible in light of the relatively
short time since the new legislation became effective.
newness of binding estimates and the other rate and service
innovations being offered necessarily limits the scope of this
It will be only after the industry and the shippers
being served have the opportunity to become fully experienced
with the many changes taking place that unqualified appraisal
will become possible.
A further objective is to provide for the novice observer of
the household goods transportation industry a brief resume of
what the industry is, what market it serves and how the service
The relationships between household goods carriers,
their agents and owner-operators and the shippers being served
are complex and subject to many variables.
Of necessity the
discussion of the relationships and how the parties interact is
condensed and represents a general overview of the subject and is
not intended to reflect the operations of any one carrier.
The Interstate Household Goods Transportation
Review of the total operating revenues of the larger
carriers indicates that the 1981 market for the services of the
industry was valued at 2.5 billion dollars. During the year the Industry transported an estimated two million shipments.
Any review of the household goods market requires first an
understanding as to specifically what commodities come within the description of household goods and what services are performed in
the transportation of those commodities.
The term "household
goods" was first formally defined by the Commission in Ex Parte MC-19, Practices of Motor Common Carriers of Household Goods, 17
MCC 467 (1939).
Through the years the original definition has
remained essentially unchanged and, in the writing of the Household Goods Transportation Act, was codified as 49 U.S.C.
10102(10), subparagraphs (A), (B) and (C). The authority defined in the three subparagraphs was initially identified as first,
second or third proviso authority and remains today most
frequently identified in that manner.
As defined by 49 U.S.c. 10102(10), the term "household
(A) personal effects and property used or to
householder 'has purchased with intent to use in
(B) furniture, fixtures, equipment, and the
(C) articles, including objects of art,
goods. Commodities transportable under subparagraph (A) are the furnishings of households. All other property of the householder normally used in the maintenance or operation of a household, such as personal automobiles, boats, yard maintenance equipment and the 11ke, are also transportable as household goods when transported as part of the relocation of the furnishings and
contents of a dwelling.
Subparagraph (B) commodities are the furnishings, equipment and Inventories of commercial establishments and offices,
hospitals, museums and all other such establishments. Under the
authority provided by this proviso, a household goods carrier
may, for example, move a department store including all of the
furnishings, equipment and stock on hand.
Subparagraph (c) authority permits household goods carriers
to transport any commodity which because of its unusual value or
nature requires transportation utilizing the specialized
equipment and handling used in the transportation of first and
second proviso household goods. High value computers, trade show
displays and art collections are examples of the types of
property transportable under the third proviso description.
As a general rule, carriers authorized to transport
household goods hold out to transport those commodities under all
However, there are a limited number of carriers
which specialize in the transportation of commodities under only
one or two of the provisos.
Generally, these are among the
smaller carriers and most frequently they concentrate their efforts on the transportation of third proviso traffic, usually computers and similar electronic goods or trade show displays.
Review of the data reported by the ten largest carriers in
their annual reports to the Commission indicates that the market, based on revenue, was in 1981 composed of 80 percent first
proviso traffic, 2 percent second proviso and 18 percent third
In dollar amounts, the division of traffic by proviso
Shipments transported under the second and third provisos
are, with very limited exceptions, transported on behalf of commercial or governmental shippers. The first proviso traffic
18 divided between individual shippers (householders), commercial
and governmental shippers.
Based on data in the Annual
Performance Reports filed by the carriers, the division of first
proviso traffic by type of shipper appears to be:
The division of first proviso traffic by type of shipper
varies widely from carrier to carrier.
Many of the smaller
carriers concentrate on the transportation of government and commercial shipments and only 10 or 15 percent of their first proviso traffic 18 represented by shipments tendered by
The larger carriers concentrate more on
individual and commercial traffic and only 8 or 10 percent of the
shipments they transport are for government shippers.
The first proviso individual shipper market appears to be
valued at about one billion dollars a year at the present time.
As this is the portion of the total market most subject to being
influenced by the use of binding estimates, awareness of the size
and characteristics of the individual shipper market is desirable
in any assessment of the use and impact of binding estimates.
Household goods carriers provide a variety of services other than intercity transportation and receive a significant amount of
revenue from these activities.
with respect to first proviso
traffic, the revenues realized from the performance of these