Local General Freight Trucking

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 30,000 local general freight trucking companies in the US provide truckload (TL) and less than truckload (LTL) transportation services within cities and over short distances with drivers returning home each night. Trucking firms transport a wide variety of goods, but the majority is boxed or palletized. Local routes are typically less than 150 miles.

Failure to Meet Safety Requirements

Failure to meet safety regulations can result in investigations, fines, loss of license, and idled vehicles.

Emergence of Online Freight Coordinators

The local freight trucking industry is benefiting from online sites, like Uber Freight and TruckLoads, that match shippers and distribution centers with local freight carriers.

Industry size & Structure

A typical local general freight trucking company operates out of a single location, employs 9 workers, and generates about $1.3 million annually.

    • The local general freight trucking industry consists of about 30,000 companies, which employ about 264,000 workers and generate about $38 billion annually.
    • The industry is fragmented with the 50 largest firms representing just 10% of revenue.
    • Firms range from the small operations that serves a single local area using few owned trucks, to large firms that operate a network of locations across the nation using leased vehicles and servicing many local markets.
    • About two dozen large firms have networks of 10 or more establishments, which are regionally or nationally dispersed to serve specific cities.
    • Large companies include Jack Hood Transportation, Holland, Reddaway, New Penn, Cowan and EPES.
                                    Industry Forecast
                                    Local General Freight Trucking Industry Growth
                                    Source: Vertical IQ and Inforum

                                    Recent Developments

                                    Mar 2, 2023 - Diesel Prices Remain Volatile
                                    • Retail diesel prices were decreasing in late February after rising steadily during January. The weekly US Department of Energy/Energy Information Administration price for February 27 decreased 8.2 cents a gallon to $4.294 a gallon. It was the fourth consecutive week in which the benchmark price used for most fuel surcharges fell and the 13th time in the past 16 weeks. The price dropped 32.8 cents a gallon during the previous four weeks.
                                    • Decreasing retail diesel prices have been driven by pump prices catching up with earlier declines in futures and wholesale diesel prices, according to trucking industry news site Freightwaves. Some analysts see price increases ahead, however. Goldman Sachs’ head of commodity research Jeffrey Currie expects higher prices by the end of 2023. “Our conviction in the bull case has never been stronger,” Currie said. He cited a lack of significant spare capacity in markets and low inventories for most crude and products, with the result that “you have no buffer to deal with the rebound in demand that is likely to come out of China. As China starts powering ahead, that is going to tighten up the bull market.” He also cited what he forecast as “strong” economic activity in Europe.
                                    • Waymo, technology conglomerate Alphabet's driverless-vehicle unit, says it has transported more than one million pounds of Modelo and Corona beer over 220 miles a day to Houston from Dallas under a pilot program for beer, wine, and spirits conglomerate Constellation Brands. The program, which started in April, is being done with trucking company C.H. Robinson Worldwide. The freight is being delivered in Class 8 trucks using Waymo’s self-driving software and a safety driver behind the wheel. C.H. Robinson, officials say that working with Waymo is a potential long-term answer to the shortage of long-haul drivers, while Waymo sees it as a way to commercialize its 13-year investment in self-driving vehicles.
                                    • The Inflation Reduction Act, which was signed into law in August, includes the Qualified Commercial Clean Vehicle tax credit to accelerate adoption of electric medium-duty and heavy-duty trucks. A tax credit of up to $40,000 is available to help make owning an electric truck cheaper than owning a diesel one in most use cases. Urban and regional electric trucks are likely to be cost-superior to diesel ones as soon as 2023, according to some analysts.
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