The consolidation of the U.S. trucking industry is picking up speed, with big trucking companies and private equity funds scooping up smaller firms, according to data complied by Thomson Reuters.
Todd McMahon, managing director at investment bank Capstone Partners, told the media outlet publicly announced mergers and acquisitions are expected to keep rising as smaller carriers look to exit the industry ahead of the mandate for electronic logging devices this December.
The new mandate makes it harder for some trucking firms to bend hours of service rules and likely affect productivity, which would pressure already razor-thin margins at smaller trucking firms.
Executives at larger trucking companies and private equity firms have said they are aggressively hunting for deals, says Reuters.
“It’s (the pace of acquisitions) been as busy as we’ve seen it since we started the business 13 years ago,” said Jim Parham, managing partner Florida-based M&A advisory firm Transport Capital Partners.
Some privately held carriers are focused on building out their own fleet rather than buying other firms.
“Our big customers are getting bigger and they are doing business with fewer transportation providers,” said Brad Pinchuk, CEO of Dubuque, Iowa-based Hirschbach Motor Lines. “That makes it pretty darn tough for a small guy to do business directly with a large shipper.”
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