Analyst: Truckload Carriers Facing Tough Times

SAN FRANCISCO — Hauling freight offers a grim but not impossible living, according to two market analysts who addressed an audience of motor carrier finance officers.

Speaking to the National Accounting and Finance Council here June 20, Timothy Quillin labeled himself a “harbinger of gloom and doom.” He described trucking as a highly competitive, even fragmented, market of more than 50,000 rival companies whose people work very hard but do not necessarily get high returns for their efforts.

As problems for the industry, Quillin, a vice president and transportation analyst with Stephens Inc. of Little Rock, Ark., cited the usual culprits of high fuel prices and a low supply of drivers, and then added the glut of used trucks and the potential difficulties threatened by the Department of Transportation’s hour-of-service proposal.

These factors, and more, have created a situation where “the book value of companies is greater than their market value for truckload carriers.” That means if the average truckload carrier were to sell his or her company, he or she probably would not be able to get a price premium that exceeds the conservative estimation of assets required by accounting standards.

For the full story, see the June 26 print edition of Transport Topics. Subscribe today.