Editorial: Ranking the Fleets, For-Hire and Private

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f there’s one common thread running through the stories of the most successful carriers of 2004 — as detailed in the Transport Topics 100 rankings of for-hire and private carriers in this issue and the last — it’s the ability to innovate in order to adapt to changing market conditions.

Last week in the for-hire rankings, we saw how several fleets expanded their brokerage and intermodal operations during 2004 to deal with high freight volume and a parallel shortage of drivers and equipment to move the cargo.

Some fleets maximized their driver productivity by switching longhaul freight to railroads, freeing up their drivers to make more and shorter hauls.

Other successful for-hire fleets augmented their dedicated carriage operations, providing guaranteed service to shippers willing to make firm commitments to their carriers. This, in effect, allowed these shippers to establish private fleets without having to buy trucks and trailers or hire drivers.

This week, in the TT 100 listing of the top private carriers, we see that some of the most successful operations during 2004 were companies that created their own fleets to compensate for the lack of capacity in the for-hire sector. Some of these new entrants then lowered their costs and raised their revenues by providing logistics services or backhauls for other shippers.

In several cases, shippers purchased logistics providers and/or bought operating authorities to allow them to provide for-hire services to others.

It was also evident in both lists that market consolidation is continuing, as the big seem to keep getting bigger. That trend has gained more momentum so far in 2005. No. 1 UPS Inc. has moved to acquire No. 20 Overnite Corp., and No. 3 Yellow Roadway Corp. acquired USF Corp., No. 12 in the 2004 TT 100 rankings.

A few changes in the ground rules also reshaped the for-hire rankings for 2004, as we added DHL Americas and several freight forwarders.

DHL inserted new competition into the small-package sector and helped underscore the increasingly global nature of the freight business. Yellow Roadway Chairman William Zollars raised more than a few eyebrows when he said the company was actively looking for business ventures in China.

And since companies such as EGL Inc. and BAX Global offer shippers alternative ways to move their freight, we decided it was time to add them to our rankings.

In all, it seems fair to say that these days, glory in the freight transportation business belongs to the smart, the fast and the flexible.

This article appeared in the Aug. 1 edition of Transport Topics. Subscribe today.