C.H. Robinson unveils AI Agent to streamline LTL freight classification ahead of NMFC overhaul

In advance of the pending changes in less-than-truckload (LTL) classification ratings of freight shipments for shippers and LTL carriers, from the National Motor Freight Traffic Association’s National Motor Freight Classification System (NMFC), set to take effect on July 19, Eden Prairie, Minn.-based global third-party logistics (3PL) services provider and freight forwarder C.H. Robinson (CHR) announced the official rollout of a new AI agent focused on automating the process determining how freight should be classified. The company did a pilot for the AI agent in January, and it went live more broadly in March, said CHR.

As previously reported by LM, when these NMFC ratings take effect, trucking executives are hoping these density-based changes will create dialogues with shippers to find common ways to cut costs and create efficiencies in freight moves and dock practices. These changes aim to simplify and modernize the classification process, making it more efficient and user-friendly for shippers, carriers and third-party logistics providers (3PLs). C.H. Robinson added that the NMFC classification system provides thousands of classes and codes to help LTL carriers know how much space and weight to plan for each individual shipment, based on the type of shipment, such as a pallet of retail goods or bulky auto parts, for example.

C.H. Robinson explained that as it moves more LTL freight than other North American-based 3PLs, the AI agent enables LTL shippers to move over to the new NMFC classification system. And, to that end, from a shipper perspective, the company explained that the AI agent is able to help them avoid delays related to misclassified freight being held by carriers for inspection, reinvoicing, and also potentially higher charges, while also augmenting the company’s LTL automation.  

In an interview with LM, Greg West, C.H. Robinson Vice President for LTL, explained that because of the complexity, granularity, and sheer volume of NMFC classes and codes, it’s always been a challenge for LTL shippers to pick the correct ones.

“That’s why our LTL automation systems have our customers’ freight classifications already loaded in,” he said. “For tenders coming in by e-mail, many of our customers have relied on the time and expertise of our LTL teams to manually look up the classification. “Now with the classification system changing pretty substantially, our new AI agent is just the latest example of how we’re applying our experience with artificial intelligence to give our LTL customers a leg up. It’s a practical and time-saving way to help those shippers who don’t know their classification or might be unsure of how to apply the new classifications come July.”   

Regarding the main benefits of the AI agent for LTL shippers, West observed that because LTL carriers charge based on the NMFC classification, they’ve become more sophisticated over time with technology and processes for checking the accuracy of a shipper’s information about their freight.

“They can’t have an overweight truck, or end up with a pallet that’s too long or too wide to fit alongside the rest of the freight,” he said. ““With our new AI agent helping to provide the correct NMFC classification, this reduces the chances of a shipper’s freight being held by the carrier for inspection, reclassification and reinvoicing. This cuts down on delays and potentially higher charges.”

When asked to provide a basic example of the AI agent at work, West presented the following scenario.

“A customer e-mails us a tender for 10 LTL shipments of different commodities, of different weights and dimensions, each with different handling instructions,” he said. “Our AI agent reads all that, consults the database of NMFC classifications, applies all the correct ones and talks to our other AI agent that completes the orders. This is where our AI agents excel, simultaneously handling multiple shipments that a person would have to handle sequentially.”

As for the next steps for the AI agent, West said it is fully functioning now with the current classifications, and when those classifications go away and the new ones go into effect July 19, the agent will be ready to apply them on day one.