What characteristic defines a contract carrier?

A contract carrier is defined by its business model of providing transportation services exclusively to a limited number of shippers, based on a contractual agreement. This type of carrier engages in agreements that specify the terms, conditions, and rates for the transportation of goods, which allows them to cater to the specific needs of their clients.

This relationship is beneficial for shippers who require consistency, tailored services, and the assurance that their goods will be transported under agreed-upon conditions. Because the services are offered under contract, these carriers have the flexibility to negotiate rates and service levels that are suited to both their capabilities and the specific requirements of their customers.

The other options do not accurately reflect the nature of contract carriers. Publicly operating and being regulated by the government relates to common carriers rather than contract carriers. Moreover, operating on an hourly wage is not a defining characteristic of contract carriers but rather describes employment models in other contexts. Lastly, not requiring contracts with suppliers describes more of an open or common carrier approach, which is not aligned with the contractual obligation that defines contract carriers.