In an interview on Auto Transport Intel (ATI), Royce Neubauer, founder and CEO of Auto Hauler Exchange, shared his vision for transforming the vehicle logistics industry through a groundbreaking B2B marketplace that connects carriers directly with shippers. His insights shed light on the critical need for transparency and efficiency in logistics, offering a refreshing alternative to traditional brokerage models.
A Transparent Marketplace
At the core of Auto Hauler Exchange is a commitment to transparency. Royce emphasized that every shipment listed on the platform comes directly from the shipper, eliminating the confusion often associated with brokerage pricing. Carriers have access to essential details such as the shipper's contact information, vehicle VINs, and shipper-direct pricing. This direct interaction fosters clear communication between carriers and shippers, enhancing the efficiency of vehicle shipments.
"When a carrier checks out a VIN, they get all the pickup information, and the shipper receives all the driver and dispatcher details," Royce explained. This level of transparency is a game changer in an industry where miscommunication can lead to delays and frustration.
Building Strong Relationships
Royce underscored the importance of the relationship between shippers and carriers. He noted that while much focus is placed on shippers, carriers are often overlooked. "Most technology in logistics is built around the shipper or buyer," he said, highlighting a gap in the market.
When developing Auto Hauler Exchange, the team prioritized the needs of carriers. "They need payment, and they need to work with large shippers," Royce pointed out. By partnering with significant players in the industry, Auto Hauler Exchange provides thousands of smaller fleets—those with one to twenty trucks—the opportunity to connect with major shippers. This model not only facilitates better payment practices but also helps carriers build long-term relationships with shippers.
Empowering Carriers
Royce's approach goes beyond mere logistics; it's about empowering carriers. He acknowledged the industry's historical dependence on brokers, who currently control a significant portion of shipments. "Brokers own this industry," he said, "but we’re creating an ecosystem where carriers can thrive without intermediaries."
By allowing shippers to connect directly with carriers, the Auto Hauler Exchange not only reduces costs associated with brokerage fees but also enables carriers to maximize their revenue. "If a carrier sees a consistent shipping opportunity, they can go direct with that shipper," Royce noted. This potential for direct relationships builds a community that traditional load boards often fail to facilitate.
Enhancing Efficiency
One of the significant challenges in vehicle logistics is the underutilization of capacity. Royce pointed out that many auto haulers frequently drive with empty spots on their trucks, resulting in lost revenue opportunities. "We wanted to create an environment where carriers can find additional shipments nearby," he explained.
The Auto Hauler Exchange addresses this issue by populating nearby shipping opportunities when a carrier picks up a load. For instance, if a carrier picks up four cars but has a six-car hauler, they can quickly find another shipment just around the corner. This capability not only maximizes the carrier's capacity but also allows shippers to move their vehicles more efficiently.
Real-Time Decision-Making
Royce also highlighted the importance of timely decision-making for carriers. He noted, "If you like something and you really want to move a shipment and you see it, you better go grab it." In a competitive marketplace, carriers need to act quickly because opportunities can vanish rapidly. He explained that the platform's fair pricing often leads dealers to price their shipments higher to expedite movement, thus lowering their carrying costs and depreciation values.
"Dealers are looking to sell cars faster," he said, emphasizing the shift in mindset. By investing slightly more in logistics, dealers can turn over inventory more quickly and ultimately enhance their profitability. This reorientation helps redefine logistics from a mere expense to a strategic investment.
Leveraging Technology for Growth
Royce argued that technology should enhance logistics operations rather than complicate them. "If you're adding technology that doesn't drive efficiency and revenue, you shouldn't add it," he said. Auto Hauler Exchange aims to make the technology seamless and user-friendly for both shippers and carriers. The platform is free for both parties, and carriers receive direct payments based on shipper pricing, eliminating the need for lengthy payment delays often seen with brokers.
Compliance and Vetting
Addressing questions about compliance, Royce confirmed that the Auto Hauler Exchange employs a rigorous vetting process for carriers. "Only vetted carriers that meet insurance requirements and safety standards have visibility on the exchange," he stated. This commitment to compliance ensures that shippers can trust the carriers moving their vehicles, promoting a safer and more reliable logistics environment.
Aiming for Industry Growth
Royce's insights highlight a broader industry challenge: the driver shortage. Estimates suggest that the industry could be short anywhere from 20,000 to 100,000 drivers. According to Royce, the key reasons include insufficient revenue per shipment and the high number of underutilized trucks. "If we can increase revenue for carriers, we can attract more drivers back into the industry," he asserted.
By returning a percentage of the broker's take to the drivers, the Auto Hauler Exchange aims to create a more sustainable model that allows carriers to invest in their businesses and recruit new drivers. This shift could significantly impact the industry by addressing the driver shortage and improving overall service quality.
Understanding Shippers and Carriers
Royce also shared his approach to understanding the needs of both shippers and carriers. "You figure that out by asking questions," he said. When interviewing shippers, the first question is, "What are you looking for in your relationship with a carrier?" Similarly, for carriers, he asks, "If you could build a perfect environment and just drive your truck, what would it look like?"
His findings reveal a common sentiment: carriers want to work directly with shippers but feel constrained by the payment processes associated with brokers. "When we started building Auto Hauler Exchange, we incorporated the good things that brokers do, like quick payments, while allowing direct relationships between carriers and shippers," Royce explained.
The Challenge of Change Management
Royce acknowledged that one of the toughest challenges is change management. "Getting people to look at it differently" is crucial for the platform's success. He recounted a situation where a factoring company hesitated to work with Auto Hauler Exchange simply because it was a new model. "We had to explain that we're not a broker; we are facilitating direct payments to carriers."
This need for education extends to both shippers and carriers. "Once they give it a try, they keep growing," Royce noted, mentioning that feedback from shippers has been overwhelmingly positive, with many noting that the platform is easier to use than their previous systems.
Royce emphasized that the goal is to make the platform as user-friendly as possible. "We want it to be dummy-proof," he stated. "If I can log in, post a VIN, and check a VIN out, then anyone can do it." Continuous feedback from shippers and carriers helps improve the platform, ensuring it remains efficient and effective.
Conclusion
Royce Neubauer’s vision for the Auto Hauler Exchange presents a compelling case for transforming vehicle logistics through transparency, efficiency, and direct connections between shippers and carriers. By eliminating unnecessary intermediaries, the platform not only empowers carriers but also fosters a more collaborative and efficient logistics ecosystem.
As the industry continues to evolve, initiatives like the Auto Hauler Exchange could play a crucial role in addressing longstanding challenges, creating a future where carriers and shippers can thrive together. The focus on building strong relationships, leveraging technology, and enhancing communication is set to redefine the standards of vehicle logistics for years to come.
