Revenue Ton Mile

DEFINITION of 'Revenue Ton Mile'

A single ton of goods that is transported for one mile. Revenue ton miles are used to determine the total amount of freight that is shipped by a transportation company. Railroads determine revenue ton miles by multiplying the weight of paid tonnage by the total number of miles it has been transported.

BREAKING DOWN 'Revenue Ton Mile'

Revenue ton miles are an important determinant of profit in the transportation industry. In order to come out ahead, a transportation firm must be able to make a profit per mile on the freight that is shipped. Revenue ton miles are similar conceptually to revenue passenger miles, the measure employed by the airlines.

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