This sound is generated automatically. Let us know if you have any feedback.
Dive Summary:
- XPO’s core LTL business delivered nearly 50% year-over-year operating revenue growth to $175 million in Q1; the carrier announced in an earnings report on Friday.
- The 9.8 percent increase in efficiency, excluding the fuel surcharge, helped boost operating income and improve the plant’s operating ratio to 85.7 percent, the company said.
- Also helping were customer contract renewals with price increases in the high single digits, Chief Strategy Officer Ali Faghri told Trucking Dive in an interview. XPO recommits about 25% of its contracts each quarter.
Dive Insight:
XPO’s increased throughput, shipments and LTL capacity contributed to its total operating income of $138 million in the quarter, up from $58 million in the first quarter of 2023.
Capacity per day was 2.6% higher than in the first quarter of 2023, with 4.7% more shipments per day.
“As you saw in our results, our LTL Plan 2.0 it’s firing on all cylinders,” CEO Mario Harik said during an earnings call on Friday.
XPO’s $870 million terminal acquisitions from Yellow Corp. and service improvements have made price increases more palatable to customers, and the company’s investments in its high-performance local customer base and premium services are already paying off, Faghri said.
Those premium services include trade show trucks, Mexico cross-border service and a retail store drop-off service that has added dozens of customers since launching in the fourth quarter, the chief strategist said.
“It was a few different factors that translated into this strong price growth, and we expect that to continue here in the second quarter and through the balance of this year into 2025,” Faghri said.