transportationreport
BY MARK B. SOLOMON, SENIOR EDITOR
Back on the road Back on the road
Thanks to an
improving U.S.
economy, decent
volume growth, and
an avoidance of
past errors, LTL is
no longer the wreck
on the highway.
THERE’S A PROVERB THAT “THERE ARE NO MISTAKES, JUST LESSONS.” IF
that’s the case, the less-than-truckload (LTL) sector has received a world-class education during the past five to six years.
After a terrible cycle that saw the LTL market shrink from more than $33 billion
at the last peak (in 2006) to $25.2 billion at the recession’s trough in 2009, carriers
appear to have gotten their act together.
Market size has stabilized at about $30.6 billion, though that’s still about 10 percent below its pre-recession high. Gone, at least for now, are the price wars that were
largely designed to drive ailing YRC Worldwide Inc., the market leader at the time,
out of business but ended up backfiring on the carriers that launched them.
Volumes have returned as the economy has gradually improved, giving carriers the
chance to restore sanity to their pricing and their bottom lines.
In addition, through network redesigns and tough operational pruning, carriers
have sopped up a large amount of the excess capacity that plagued them through the
downturn and in the early part of what has been a halting recovery.
