One of the nation’s highest-profile investors has decided that he needs to put some money into trucking, a move based on the assumption the industry is a hotbed of activity right now.
Warren Buffett, who is synonymous with big-time deal-making, last week made a big-time deal that will in a few years make his Berkshire Hathaway investment company the majority owner of Pilot Flying J, the nation’s largest truck stop chain. He’s acquiring a minority stake to start, but by 2023 his firm will own 80% of the chain, taking control away from Pilot’s founding Haslam family.
The Haslams aren’t the only longtime trucking family to strike a deal that will shift the industry’s ownership landscape.
NFI Industries has reached an agreement to acquire California Cartage, a deal worked out by two venerable trucking families: the Browns, who started NFI in 1932, and the Curry family, which founded Cal Cartage in 1944. Robert Curry Sr will retire once the deal closes, but he said in a letter to shareholders after handing over the company the Browns are the best people to “keep this company moving forward.”
These kinds of deals also are moving the industry forward, refreshing older entities and redefining trucking ownership, and — in the case of Berkshire Hathaway — even bringing new entrants into the fold.
New blood also is pouring in to sell equipment, as evidenced by the numerous manufacturers of electronic logging devices exhibiting at the recent North American Commercial Vehicle Show. These tech companies see opportunity in the soon-to-arrive ELD mandate, and they’re jumping into trucking likely for the same reason as Buffett — to seize opportunity in a growth industry.
Those who make trucks and trailers see the same opportunity. Look no further for proof than the wave of new products hitting the market. New on-highway, regional and vocational models have been introduced in the past few months, with manufacturing executives touting the potential they see for their new products. Freight-hauling capacity is expected to tighten among over-the-road fleets with the arrival of the ELD mandate, while the surging last-mile delivery market will boost regional business and drive demand in regional haul. Trailer makers also are part of the story. Deals are being made and new products launched in that sector as well.
All of this activity combined is creating an era of change for trucking. We’re in the middle of it now, and it’s far from over.