The cost structure of motor carriers is fixed versus variable cost components whereas in the railroad industry, there are three types of cost structure: fixed costs, semivariable costs, and variable costs. The railroad industry has a larger portion of direct and indirect fixed costs than variable cost like the motor carrier industry. This is due to the fact that the railroad industry owns and maintains their own network and terminals and operate their own rolling stock. The railroad industry operates on trains and tracks which they fully own and operate whereas the motor carrier industry operates on highways which is maintained by the federal government. There is less volume of traffic to address since terminals are privately owned. Semivariable
