Differences Between Truckload (FTL) and Less Than Truckload (LTL)

One of the critical choices you’ll face in fleet management is selecting an appropriate shipping method. Two of the most popular options for moving freight are Less Than Truckload (LTL) and Full Truckload (FTL).

The decision can affect your delivery times, overall costs, and even the condition of the goods upon arrival. In other words, optimizing shipping methods shouldn’t be an afterthought — it directly affects your bottom line.

This article offers a straightforward guide to the differences between these two options, so you can get the most efficiency from your fleet lease vehicles, freight services, and third-party logistics providers.

What Is Full Truckload?

Full Truckload — often referred to in the industry as Truckload, TL, or FTL — is a shipping method where one business books the entire space of a truck’s trailer for their goods.

The entire truck is dedicated to that shipment, and it goes directly from the pickup point to the delivery destination without stopping at other hubs or terminals. Nor will there be any transfers or handling of other shippers’ goods.

Consequently, Full Truckload shipping is most commonly used for large shipments that can completely fill an entire trailer (otherwise there would be unutilized space inside the trailer and a waste of financial investment).

Full Truckload is also commonly used when a shipper prefers exclusive trailer use due to the nature of the goods, such as fragile or high-value products, or goods that otherwise require special handling or conditions (such as temperature control). This allows for a more controlled environment that minimizes the risk of damage/loss since the freight remains in the same trailer throughout the journey.

What Is Less Than Truckload?

Less Than Truckload, or LTL, is a shipping method where multiple shippers place their items on the same truck. This way, shippers only pay for the space they use rather than a full trailer, splitting the total cost among several parties to make it more economical for everyone involved.

It is most commonly used for several shipments heading in the same direction that are too large for parcel delivery but do not require a Full Truckload of space.

LTL shipping tends to operate on a hub-and-spoke network, where local terminals serve as consolidation and distribution points. Freight is transferred between trucks and facilities as it moves from origin to destination, as the diagram below illustrates, meaning there could be multiple loads and unloads across a journey.

Less Than Truckload vs Truckload Compared

Let’s take a closer look at how Less Than Truckload and Truckload shipping differ—from costs to flexibility and more. Here are two overviews of the strengths and weaknesses of both types of shipping before we dive into our in-depth comparison.

Typical Load

FTL deals with heavy, bulky shipments that can fill an entire truck. This typically involves loads of over 15,000 pounds or more than 10 pallets. Also, the goods won’t share the space with anyone else’s.

Meanwhile, LTL is designed for smaller shipments, typically under 15,000 pounds, that don’t require an entire truck. Here, the freight will share space with other shippers.

Cost

Pricing for FTL is mainly influenced by changing fleet management costs and other market forces such as supply and demand. Because of this, prices can fluctuate.

LTL pricing is more structured and is based on regulated rates set by the National Motor Freight Traffic Association (NMFTA). These rates are influenced by ‌National Motor Freight Classification (NMFC) codes, which consider factors such as the item’s density, storability, and value.

Transit Time

With FTL, there’s no need to wait for other shipments to fill up the truck, and the driver will take the load directly to its destination.

LTL is slower because the shipment shares the truck with others. This means more stops along the way for loading and unloading.

Risk of Damage

Since the goods occupy the entire truck and there’s less handling involved, FTL generally has a lower risk of damage.

On the flip side, since LTL involves multiple shipments in a single truck, there’s more handling involved. Every time the truck stops to load or unload, there’s a risk the shipment could get damaged.

Flexibility

With FTL, you need to have enough goods to fill a truck. This often makes it less flexible for smaller operations or infrequent shipping.

LTL offers more flexibility. As much or as little can be shipped without waiting to fill up an entire truck. This makes it a good option for businesses that have varying shipping needs.

Summary: Less Than Truckload vs Truckload

Less Than Truckload and Truckload Logistics

You should now know what constitutes a Truckload and Less Than Truckload and how each could benefit your fleet operations. But what might be a little more challenging to understand, especially with the latter, is how that functions logistically. Here’s a brief run through of how each works in reality.

How does Less Than Truckload shipping work?

Less Than Truckload is the more logistically complicated of the two. Still, we can explain how Less Than Truckload shipping works in a few simple steps, as if we are completing a trip ourselves:

1. Pickup: Local trucks collect freight from various shippers.
2. Terminals: Freight is taken to a local terminal, sorted, and consolidated with other shipments.
3. Linehaul transport: Combined freight is transported to a destination terminal.
4. Final Delivery: Local trucks deliver freight to the respective consignees.

How does Truckload shipping work?

With just one shipper hiring out the truck, Truckload shipping is logistically straightforward.

The truck moves directly from the pickup location to the delivery destination. There are no intermediate stops or transfers with other shipments.

Trends Influencing FTL and LTL Shipping

In 2024, several trends are influencing the Full Truckload and Less Than Full Truckload shipping industry. Let’s go through some of the biggest trends in today’s freight trucking world.

Technological advancements

• Real-time tracking: Both FTL and LTL carriers are implementing GPS tracking for trucks and other IoT devices for better visibility of precious cargo and management of fleet vehicles.
• Dynamic pricing: In 2023, many of the largest LTL carriers engaged with dynamic pricing in response to low freight volume for the first time, and this trend has continues throughout 2024.
• Automation and AI: Use of artificial intelligence for demand forecasting, route optimization, and capacity planning continues to expand month by month.

Shift toward sustainability

• Eco-friendly practices: Adoption of more fuel-efficient vehicles to better a business fleet’s fuel economy, as well as alternative fuels (or electric vehicles) to reduce carbon footprints.
• Optimized routing: Reducing empty miles and improving load factors to enhance efficiency via smart routing tools as part of advanced fleet management software such as Verizon Connect or GPS Insight.

Customized shipping solutions

• Partial Truckload (PTL): A hybrid between FTL and LTL, Partial Truck Load shipping doesn’t see an entire truck filled, but freight tends to stay on one vehicle or is handled significantly less than Less Than Truckload shipments.
• White-glove services: Premium delivery options that include setup or installation once freight is at its arrival point, catering to high-end e-commerce products in particular.

Case Study: Less Than Truckload and E-Commerce

The rise of e-commerce has significantly reshaped the logistics and transportation industry. Namely, consumer demand for various products and fast delivery times have seen Less Than Truckload shipping become a critical component in meeting these logistical challenges.

That’s largely down to a rise in small, frequent shipments as part of increased demand from consumers as e-commerce marketplaces have become more common. E-commerce retailers often receive numerous small orders rather than large bulk purchases, therefore requiring shipping methods that can efficiently handle smaller loads. Step in LTL.

When to use FTL vs. LTL

When you’re deciding between using FTL and LTL for a shipment, consider the following:

• Shipment size: When moving a large volume of goods that can fill up an entire truck or weigh over 15,000 pounds, FTL is the way to go. LTL, on the other hand, is ideal for shipments under 15,000 pounds or when shipping up to six pallets.
• Time-sensitive cargo: FTL shipping is faster because it doesn’t make multiple stops to pick up or drop off other shipments. With LTL, exact delivery dates are usually estimated, so the transport will need a flexible delivery window.
• Fragile or high-value goods: Since FTL involves less handling of goods (just one load and unload), the chances of damage are lower. So, when shipping delicate or expensive items, FTL is generally safer than LTL.
• Specific requirements: Some goods need special conditions, such as temperature control. The entire truck can be tailored to meet these specific needs in an FTL shipment, something that’s not possible with LTL.
• Budget: With LTL, each shipper pays only for the space they use, making it cost-effective for smaller loads.
• The environment: With LTL, truck space is shared. Sharing truck space is better for the environment since fewer trucks are needed overall.