How To Start A Car Transport Business?

Wouldn’t it be exciting to launch a car-hauling company?

Yes?

Then let’s go over the preliminary steps involved in getting this venture off the ground!

How to start an auto transport business is reasonably straightforward.

The most exciting aspect of this line of work is the freedom it affords you to set your own hours.

You’ll be your own boss! 

Doing so lets you turn your passion for long-distance driving and interest in the trucking industry into a lucrative career path.

You can launch a car hauling company with a modest initial investment.

In the initial steps of a company’s development, having the entrepreneur act as both a worker and a manager can significantly cut down on initial overhead costs. 

The money you make will be reinvested into the business, allowing you to expand with staff or more equipment. 

The fundamentals of starting your own car-hauling business are laid out below.

how to start a car transport business

What Does A Car Hauling Business Entail?

Car haulage is the process of moving automobiles from one location to another. 

Drivers in this industry are tasked with safely loading and transporting customers’ vehicles using specialized trucks. 

They also need to check if the shipment is safe and doesn’t exceed any weight limits.

Trucking companies facilitate transactions between shippers and recipients.

When people move, they also often need to have their cars transported to their new residence.

Related Reading: How To Advertise On Cars – Learn Here.

How To Start An Auto Transport Business 

Write A Business Plan

Your car-hauling business, like any other, requires a detailed strategy.

Improve the efficiency of your planning by basing your choices on what you’ve learned through studying the market and related fields in depth. 

A complete strategy will include expected expenses, marketing approaches, target markets, and price points for your services. 

Keeping a high standard of service for your trucks and staying within the gross vehicle weight limits can help you stay in compliance. 

As an owner-operator, your safe driving record is crucial to the success of your trucking business.

The Car Hauling Business Plan

Productive transportation entrepreneurs are in charge of running the day-to-day operations of their companies. 

Some vital operational points should be outlined in your strategy. The most important ones are:

  • Liability and cargo insurance 
  • Business structure 
  • Business License 
  • Financial projections 
  • Core business process refinement 
  • Central dispatch plan 
  • Marketing strategy 
  • Maintenance 

Choose Your Motor Carrier Service Niche 

When starting out, you’ll face some tough choices as a vehicle-hauling business owner.

Which truck or fleet of trucks you require depends on the market you’ve decided to cover. 

You can ship many vehicles, both new and secondhand, over short or long distances.

Collaborating with vehicle lots is a good idea because it might lead to steady work.

Your transport business may also use car trailers to move vehicles one at a time. 

Depending on considerations such as road conditions, the vehicles can be transported in either an open or enclosed trailer.

Figure Out Operation Expenses 

If you want to stay on budget, it’s essential to take a close look at your initial and recurring costs.

Expenses for your new venture can include:

  • Registration fee 
  • Car-hauling trucks 
  • DOT number 
  • Unified Carrier Registration (UCR) 
  • Fuel and maintenance expenses 
  • IRP (International Registration Plan) plates 
  • Tollgate fees 
  • Annual permit costs 
  • Insurance premiums 

You can get started with just one vehicle and so keep your startup costs low.

You can start sooner and not stress over funding. 

Source The Right Equipment

Your auto-hauling business will benefit significantly from an initial investment in a heavy-duty car trailer designed to accommodate the usual number of vehicles you will be transporting. 

Ensure that the pickup trucks (dually) or full-size semi-trucks you want to use for your company comply with towing standards. 

Find out what options dealerships have that fit your needs.

If a dealership does not stock the precise make and model of truck you need, they should be able to locate it for you. 

You can waste a lot of time and money on repairs and maintenance if you don’t plan ahead here.

Lay The Foundation For Your Business

Once your plan looks right, it’s time to get cracking! First, you’ll need to register your business. 

You can gain the security afforded to legal entities by registering your auto transport business. 

If you set up your company this way, it will be simpler to separate company funds from your own. 

You should get the appropriate insurance, register your company with the proper authorities, and give it a memorable name when you set up shop. 

The procedure to register a company name is simple.

Visit the secretary of state’s website to see if the name you want to use is available before submitting an application.

Business Structure 

There are several business structures to choose from, so find the one that best fits your long-term goals. 

Choose between a partnership, corporation, or limited liability company if you plan to expand the auto transport business throughout many states. 

Companies with multiple owners may struggle under the sole proprietorship structure.

You can safeguard yourself from financial ruin in the event of a car-hauling lawsuit by forming an LLC.

As a result, creditors or litigants cannot seize a person’s property to pay off obligations or expenses. 

Moreover, compared to a corporation, an LLC is a less complicated and more adaptable corporate form.

Taxes can be paid on an individual basis through the Internal Revenue Service (IRS) (pass-through tax status).

For tax and banking purposes, you may need to file for an EIN from the IRS, depending on the business structure you choose.

Permits and Licenses 

Adherence to federal, state, and local regulations is crucial to the success of your new motor carrier business.

Naturally, you’ll need a commercial driver’s license as a car hauler.

Make sure you cover the paperwork that needs to be filled out and filed.

Doing so can assist your organization stands out among the crowd in the cutthroat transportation industry.

Permits and licenses, like those for transporting heavy loads or operating commercial vehicles, are necessary. 

You need to apply for a DOT number from the Department of Transportation to comply with the law. 

If you intend to run operations in more than one state, you will need a motor carrier number or operational authority (MC/FF number). 

As an added precaution, you should research each state’s restrictions on long-distance drivers.

Insurance 

To operate legally, your trucking company needs to carry specific types of insurance. 

To be prepared for the unexpected, you should get trucker insurance in the form of general liability insurance and any other policy products that give adequate coverage for truckers. 

Your preferred insurance provider might also provide BOP groups insurance and worker’s comp as supplementary coverage.

Business Bank Account 

Opening a business bank account will help keep your financial dealings separate from your private life. 

Your company’s credit rating will begin to rise as soon as you open this account, which is a nice bonus. 

If you only use your personal funds, getting business loans to expand will be difficult.

To open a new bank account, you’ll need to provide registration paperwork and the EIN confirmation letter.

Tax Obligations 

The Internal Revenue Service levies varying taxes on different business structures.

This means that you need to painstakingly consider how you want to structure your auto transport company. 

The reporting obligations for taxes are less burdensome for an LLC than they are for a corporation.

Business owners should also think about federal, state, and municipal taxes.

Your business may be subject to heavy vehicle usage tax in addition to other fees and levies.

Related Reading: How To Start A Woodworking Business – Learn More Here.

Tell The World About Your Business 

Tell The World About Your Business

It’s crucial to maintain momentum by actively promoting your business.

With the right advertising plan in place, you can give the local mom-and-pop auto transport shops a run for their money. 

A successful branding plan should be one of your top priorities as you work toward your goals.

Increasing your company’s visibility in the industry can help consumers learn to recognize your brand.

The most successful trucking businesses all have distinctive brands, including memorable logos.

Make a logo that stands out from the competition. 

An excellent logo design can convey important information about your company.

The website, brochures, and social media profiles should have your company’s logo.

Website 

Customers will have an easier time finding your business if you have a dedicated website and Google My Business page for auto transport. 

Your site will work well in tandem with other types of advertising, both online and off.

Without the aid of a specialized web developer, you may create a website that is both extremely useful and attractive. 

Web hosts typically offer easy-to-use website creation tools that do not require any knowledge of coding.

However, if you need to hire a professional developer, look on FlexJobs, Upwork, or Fiverr.

Oversee The Day-to-day Operations 

It’s not always clear skies after you start a car hauling business.

Keeping tabs on and managing the company’s finances is a must.

This may be done with the help of either experience or a user-friendly accounting program. 

Fortunately, there are a plethora of practical and reasonably priced options to choose from. 

As your business progresses, you’ll want to expand when you’re able. Assess how your operations are to see what can be improved. 

Related Reading: How To Start An Escape Room Business – Check Out Here

Final Thoughts 

If you put in the time and effort and keep up with the rules, hauling vehicles for a job is a lucrative career choice. 

If you’re just a newbie in the transportation business, you probably want to guarantee that you obtain the loads you want.

Following the steps above and maintaining an organized operation will be crucial. 

If you want access to more advice and resources, working with a logistics firm could be the way to go.

Disclosure:  this article might contain links to the resources discussed.
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Brooks Conkle

Brooks is an Entrepreneur, Sponge, Father, Husband, & Follower of the Golden Rule. He has over 15 years of experience as an entrepreneur after graduating with a BSBA in Finance from Auburn University. He’s addicted to growing new business ideas and any food that includes chocolate and peanut butter. Brooks is a firm believer in creating multiple streams of income and creates content here on BrooksConkle.com to help other hustlers in the areas of marketing, online business, personal finance, and real estate.