Many Carriers Enjoy 2018 Banner Year for Revenue Growth
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It was a historically great year for trucking in 2018 with robust growth in revenue and better margins, but not all companies saw the benefits of a strong economy.
Flatbed/heavy specialized and intermodal/drayage continue to be hot sectors with revenue gains of 18.9% and 18.4%, respectively in 2018. The refrigerated sector also did well, rising 12.4% year over year, followed by tank/bulk with a gain of 10.7%. Revenue declined in the motor vehicle/driveaway sector and grew very slowly in household goods/commercial delivery sectors.
Overall, revenue for 312 carriers in 11 different freight sectors increased 8% to $245.6 billion in 2018 from $227.4 billion in 2017.
Truckload and dedicated carriers experienced strong demand for their services during the past year, but there are questions about the road ahead.
Does the recent shutdown of Falcon Transport, for example, hint at a broader downturn in auto manufacturing?
Will carriers be able to recover higher costs for driver pay and continue to invest in new equipment and technology if shipping rates slip?
Despite those lingering questions, the past year was without a doubt a banner year for nearly every carrier in this sector.
Revenue for a group of 87 carriers climbed 9.6% to $34.7 billion in 2018 compared with $31.7 billion in 2017, based on a review of results for carriers with comparable data for both years.
Knight-Swift Transportation Services maintained its status at the top, but revenue fell slightly as the Phoenix-based company rationalized operations following the merger of Knight Transportation and Swift Transportation in September 2017.
Meanwhile, carriers in the intermodal/drayage sector continue to see robust growth as shippers convert more freight from the highway to railroads and goods continue to flow in and out of ports in response to increased global trade.
RoadOne IntermodaLogistics gained the most ground during the past year, boosting revenue by 71.4% to $300 million and expanding its reach with several acquisitions. The company also attracted interest from private equity investors with Boston-based Nonantum Capital Partners participating in an equity buyout in January.
Altogether, a group of 24 carriers generated revenue of $13.1 billion in 2018, an increase of 18.4% from $11 billion in 2017.