Knight-Swift Transportation Holdings’ less-than-truckload network is adding density in states where it already has a presence, but CEO Adam Miller is noting the potential to go beyond those areas.
The executive suggested on an earnings call April 24 that other states are part of the company’s path in developing a nationwide network.
“We plan to continue down the path of organic growth but also maintain a desire to acquire LTL companies that will provide a foothold in the Southwest and Northeast regions,” he said.
M&A activity likely will play a big role in allowing the company to gain “a foothold or kind of entry” into those areas, SVP of Investor Relations & Treasurer Brad Stewart told Trucking Dive. Both M&A and organic growth is 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% increase in its less-than-truckload door count compared to the end of 2023, CFO Andrew Hess said last month.
Of those new openings, five already went online in January, and two more did so in the remainder of Q1 for a total of seven additions during the quarter.
“Filling out a super regional network in the short term and ultimately creating a national network will allow us to participate in more freight and enable us to find opportunities to further support our existing truckload customers with LTL capacity,” Hess said.
Knight-Swift sees its diversified freight 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, LTL businesses are highly consolidated and became even more so with the collapse of Yellow Corp. last year.
Remaining players, such as Knight-Swift, have already taken over Yellow assets. But amid the shakeup, other LTL players could also sell off properties that they’ve relocated from, said Ken Hoexter, a managing director for Bank of America, a financial services provider to the carrier. He also noted organic additions could also play into the mix.
In the near term, Knight-Swift will focus on organic LTL expansion, Miller said.
“But as the truckload market improves, we are willing to invest in additional capacity in terminals where we believe we can successfully grow,” Miller said.
