Car hauling is a lucrative venture if you have a trucking business. But before you can succeed in this business, you must know the right strategy on how to make money auto-hauling.
In this post, we will discuss this topic more and how much you can expect to make. Read on and learn how we can help you find your first auto-hauling clients.
How does hauling cars work?
Car hauling or auto transport is a specialized trucking service. Unlike container freights that ship items like food, appliances, and clothing, this type of load literally involves actual vehicle units.
Your load may contain sedans, SUVs, pick-up trucks, and other models. It can be transported either in open or enclosed carriers, depending on the number of vehicles needed to be delivered.
Moreover, car haulers are in demand among car manufacturers, dealers, brokers, and even private car owners.
How much do car haulers make per car?
But how much do car haulers charge per car? Car haulers can make up to $800 or more per car, but it can also be in the lower range of $150 to $300 apiece.
According to Bill Schroeder of The Auto Haulers Association of America (TAHA), experienced car haulers can make as much as $110,000 yearly.
However, profits differ from hauler to hauler. It’s because the pricing depends on the car model, type of carrier, and hauling distance.
Also, the amount of money you can make hauling cars depend on various factors. Here’s a quick rundown of these aspects:
Car brand and model
In general, luxury brands like Porsche and Rolls Royce would be more profitable than Toyota or Honda in per-car pricing. Nevertheless, any car brand could still be more lucrative than regular freight.
Luxury brands are often more expensive to haul due to the risk and value they carry. Also, they may require specialized care, like a climate-controlled carrier, which adds up to the hauling cost.
Many haulers aren’t paid per car but at a distance-based rate.
In this setup, haulers can make about $1 to $2.50 per mile, with a market average of $1.5 per mile.
For interstate car hauling, this easily translates to high profits. You can also earn more with an open carrier since it can hold more cars at once.
Depending on road conditions and other factors, haulers can negotiate higher rates. The same goes for expedited delivery and if the client wants an enclosed carrier.
Take note that hauling cars is a high-risk, high-reward business. It takes a lot of preparation and investment to make sure that you will satisfy your clients.
You should also remember that car hauling rates fluctuate depending on demand and market conditions.
Route and location
The route’s complexity and transport location will also impact your profits. You can charge higher rates if the area has difficult terrain or is in a hard-to-reach location.
So how much do car haulers make in this case? The actual rate is often negotiated between truckers and shippers/brokers.
Quantity of vehicles
The number of cars you’ll deliver will affect the cost of your hauling services. In most cases, you can offer discounts on bulk loads without hurting your profits too much.
Still, you should consider the other factors listed here, such as the complexity of transport and total distance.
How to make money hauling cars
It’s hard to get established in vehicle hauling, but it’s a gold mine once you do. Below is a quick guide to help you start a car hauling company, whether you’re a solo owner-operator or owner of a large fleet.
Update your insurance coverage.
If you’ve been transporting regular freight already, you’ll need to talk to your insurance company before you can start hauling cars for money.
Most car haulers have insurance coverage of $2 million in liability and a minimum of $500,000 for cargo. It should be higher if you’re hauling more cars.
It’s crucial to increase your coverage to boost the trust of your potential clients. It’s also for your protection in case your cargo sustains damage.
Aside from that, you should comply with all the requirements of the Department of Transportation. This includes securing operating authority and adhering to long-distance driving regulations.
Choose between open and enclosed hauling.
When it comes to hauling cars, open trailers are the most common. It loads more cars, which means you’ll get more profits in one go.
Also, open trailer trucks are less expensive than enclosed trailers. However, it offers less protection, and clients with luxury vehicles may not book your service.
On the other hand, enclosed trailers offer maximum protection. But on the downside, it requires a more significant upfront investment since it’s more expensive than an open trailer.
Still, an enclosed trailer will pay for itself once you have a steady stream of clients transporting luxury cars.
You can procure one of these types first, then acquire more as your car-hauling business grows.
Specialize in a niche.
If you want to stand out in the market and gain repeat clients, consider specializing in a niche. You can focus on hauling expensive and luxury cars, vintage cars, or collector’s models.
By establishing your reputation in hauling specific types of cars, you will become the go-to carrier of your clients. You’ll build a better reputation compared to haulers who transport any load they can find.
Before you choose a car niche you want to transport, research your target market first. Make sure that it’s in demand in your service areas.
Negotiate your rates
Negotiating is a crucial part of running a car hauling business. Always prepare a breakdown of fuel cost, insurance, maintenance, and other expenses to justify the price demand to your client.
If you have repeat customers, you can offer exclusive perks like discounts for a specific number of cars.
You can also negotiate per-car rates and ensure you’re aware of industry pricing standards. Above all, be prepared to walk away if a potential client isn’t profitable enough for your time.
Still, you should know when to compromise, especially if you’re starting out in the business. Sometimes you’d have to take some labor pains by accepting a lower price while you build your company up.
Utilize tracking technologies
Cars are expensive freight, and your clients would want assurance during transport.
With this, you should invest in GPS tracking to let your clients know where their cargo is in real-time.
Aside from that, you should have a digital portal to organize all your expenses and administrative work. This will help you save time and potential IRS penalties once you file your taxes.
Get a fuel card for trucking.
You can save money and increase your bottom line by getting a fuel card. Using this card, you will enjoy fuel discounts per gallon and service discounts on fleet maintenance products.
Fuel cards will also streamline your fuel statements as part of your International Fuel Tax Agreement (IFTA) reporting. Above all, it allows you to set spending limits to control your expenses.
While fuel savings only amount to a few cents per gallon, it can add up to an annual saving of up to $12,000 per truck.
Partner with a reliable dispatch service
Not sure where to get your first car haul? You should consider working with a truck dispatch service instead.
A dispatch service will connect you to brokers and shippers you don’t usually find on load boards. They will also conduct credit checks on each shipper to establish their payment history.
Also, dispatch services will help you save time finding cars to transport, especially if you want to specialize in a niche.
Get paid fast with Factoring Express!
You can only make money hauling cars once you get paid. Unfortunately, payments for trucking invoices often get delayed for 30 to 90 days.
Sitting and waiting for clients to pay means you’ll shoulder expenses out of pocket. No matter how high-paying the loads are, you can’t afford to keep waiting for the checks to come.
After all, you have bills to pay, truckers to salary, a fleet to maintain, and a business to run. If invoices remain unpaid, you’ll be in a cash crunch, and your profits will be compromised.
This is where Factoring Express can help. We offer truck factoring services, so you can get payments on your car hauling invoices in as fast as 24 hours.
Our process is simple: send us your idle invoice, and we pay up to 97% of its face value. Our collectors will go after your clients – we wait, not you!
If you want to improve the cash flow of your car-hauling business, call us, and we will set up your factoring account today.