National Motor Freight Traffic Association (NMFTA)

AAA

DEFINITION of 'National Motor Freight Traffic Association (NMFTA)'

A nonprofit organization representing interstate, intrastate, and international motor carriers. Since 1956, the National Motor Freight Traffic Association (NMFTA) has represented the interests of the motor carrier industry, specifically less-than-truckload (LTL) carriers. These standards are used in contract negotiations, and help parties shipping goods understand how they should be transported. The NMFTA is headquartered in Alexandria, Virginia, and helps set industry standards in commodity packaging and transport.

INVESTOPEDIA EXPLAINS 'National Motor Freight Traffic Association (NMFTA)'

NMFTA publishes the National Motor Freight Classification (NMFC), which provides a comparison of commodities that are shipped. Commodities are classified on scale and are grouped into one of eighteen classes, with classifications evaluated on the density, handling, stowabilitiy, and liability associated with a particular commodity. The classification provides transportation companies with a guideline in which to negotiate transportation contracts. The guidelines also provide minimum packaging requirements.

Any transportation company that references the NMFC in its contracts or rates is required to participate in the NMFC. Participation requires the payment of an annual fee and the completion of a licensing agreement.

Since the 1960s, the NMFTA has created and managed a unique set of identifiers for transportation companies, called the Standard Alpha Carrier Code (SCAC), which assigns two to four letter codes to each shipping company. The standard has been recognized by the American National Standards Institute (ANSI), the United Nations EDIFACT system, and the Surface Transportation Board (STB).

NMFTA also assigns a unique code to major geographic locations in North America that are involved with shipping and receiving goods, called the Standard Point Location Code (SPLC).  The classification is similar to the codes assigned to airports so that destinations can be easily identified. Each identifier is nine digits long, and identifies the region; state, province, or territory; county; and area within the county.

RELATED TERMS
  1. Private Carrier

    A company that owns the vehicles used to transport its own goods. ...
  2. New Alternative Transportation ...

    A bipartisan proposal introduced in April, 2011 that amends the ...
  3. HARPEX Shipping Index

    The container ship index of ship brokers Harper Petersen & ...
  4. Cass Freight Index

    A measurement of the monthly aggregate shipment of freight that ...
  5. Intermodal Freight

    Products and raw materials that are placed in a container that ...
  6. Cost and Freight - CFR

    A trade term requiring the seller to arrange for the carriage ...
Related Articles
  1. Investing Basics

    Industry Handbook

    In this feature, we take an in-depth look at the various techniques that determine the value and investment quality of companies from an industry perspective.
  2. The transportation industry as a percentage of U.S. GDP was 3% as of 2012.
    Fundamental Analysis

    How To Analyze The Transportation Industry

    By gaining an awareness of the transportation firms and trends that affect these players, investors can gain an edge by analyzing the sector and looking to profit from understanding it.
  3. Personal Finance

    Save On Planes, Trains And Automobiles

    Getting to, and around, your travel destination doesn't need to break the bank.
  4. Home & Auto

    How Inflation Has Affected Transportation Prices

    Getting around today is less expensive than it was 10 years ago, and this downtrend shows no signs of stopping.
  5. Home & Auto

    How The U.S. Automobile Industry Has Changed

    We give a brief history lesson on the rise and fall of the American auto industry.
  6. Personal Finance

    A Primer On The Railroad Sector

    The railroad industry might seem antiquated, but it remains an important service that reaches all corners of the country.
  7. Budgeting

    7 Tips For Avoiding Shipping Costs When Shopping Online

    Before clicking on that purchase, make sure you're getting the best deal possible.
  8. Active Trading

    Is That Airline Ready For Lift-Off?

    Break through the clouds to see if these stocks will rocket higher, or crash and burn.
  9. Options & Futures

    Analyzing Auto Stocks

    Find out what to consider before taking a ride with stocks from this industry.
  10. Investing

    My family owns an old railroad bond from 1938. Is there any way to find out whether this still has any ...

    That's a tough question, but the short answer is that you are going to have to do some homework. Where should you begin?The first step would be to contact your broker to see whether he or she ...

You May Also Like

Hot Definitions
  1. Christmas Island Dollar

    The former currency of Christmas Island, an Australian island in the Indian Ocean that was discovered on December 25, 1643. ...
  2. Santa Claus Rally

    A surge in the price of stocks that often occurs in the week between Christmas and New Year's Day. There are numerous explanations ...
  3. Commodity

    1. A basic good used in commerce that is interchangeable with other commodities of the same type. Commodities are most often ...
  4. Deferred Revenue

    Advance payments or unearned revenue, recorded on the recipient's balance sheet as a liability, until the services have been ...
  5. Multinational Corporation - MNC

    A corporation that has its facilities and other assets in at least one country other than its home country. Such companies ...
  6. SWOT Analysis

    A tool that identifies the strengths, weaknesses, opportunities and threats of an organization. Specifically, SWOT is a basic, ...
Trading Center