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Knight-Swift Transportation Holdings’ less-than-truckload network adds density to states where it already has a presence, but CEO Adam Miller notes the potential to expand beyond those areas.
The executive suggested for a earnings call on April 24 that other states are part of the company’s path to developing a nationwide network.
“We intend to continue the path of organic growth, but also maintain the desire to acquire LTL companies that will provide a base in the Southwest and Northeast regions,” he said.
M&A activity will likely play a big role in allowing the company to gain “a foothold or kind of entry” into these areas, SVP of Investor Relations & Treasurer Brad Stewart told Trucking Dive. Both mergers and acquisitions and organic growth are expected.
As discussed during earnings calls this year, the trucking giant is working to add dozens of terminals. The carrier aims to open 32 new locations this year — a 16 percent increase in the number of less-than-truckload gates compared to the end of 2023, CFO Andrew Hess said last month.
Of these new openings, five were already released in January and two more did so in the remainder of the first quarter for a total of seven additions during the quarter.
“Completing a super-regional network in the short term and eventually building a national network will allow us to participate in more freight traffic and allow us to find opportunities to further support our existing LTL truckload customers,” Hess said.
Knight-Swift sees its diversified commodity mix as a way to mitigate volatility in truckload cycles. Miller said a national network for LTL will provide a larger base of more stable income.
While truckload is a much more fragmented industry, the LTL business is highly consolidated and became even more so with the collapse of Yellow Corp. last year.
The rest of the players, like Knight-Swift, have already taken over Yellow’s assets. But amid the renewal, other LTL players could also sell properties they’ve relocated from, Ken said Hoexter, managing director for Bank of America, a financial services provider to the carrier. He also noted that organic additions could also play into the mix.
In the short term, Knight-Swift will focus on organics LTL expansion, Miller said.
“But as the truckload market improves, we are willing to invest in additional capacity at terminals where we believe we can grow successfully,” Miller said.