Author: Rick Williams

Torrid Rate of Trucking Mergers Pauses, But More Consolidation Expected

Posted on by Rick Williams

The freight trucking industry appears to be shrinking more slowing after a heady few years of company failures, strategy shifts and acquisitions.

But new players – bigger ones, diversified ones and potentially even foreign ones – are increasingly getting into the mix. And analysts believe there’s more merging to come.

“I expect it to heat up again as conditions in the truckload sector improve,” said John G. Larkin, a logistics analyst at Stifel Financial Corp. “And we may start to see conditions improve in 2017.”

At the moment, though, fewer companies are shutting down, according to investment banking and wealth management firm Avondale Partners. Last year, 310 carriers with at least five trucks went out of business, a 73.4 percent year-over-year plunge and a historic low.

The torrid pace of American mergers and acquisitions has cooled as well.

In September, transportation company CRST International Inc. acquired Gardner Trucking, Inc., California’s largest truckload carrier. This summer, trucking giant Schneider National Inc. purchased last-mile home delivery specialists Lodeso Inc. and Watkins & Shepard Trucking Inc.

But that’s a trickle compared with last year, when larger companies feasted on smaller firms amid turgid freight demand. Weaker businesses were made more vulnerable by a strong dollar, plummeting oil prices and general economic pessimism.

Now, however, many companies think they’re worth more than buyers are primed to pay, Larkin said.

“There are differences of opinion, regarding valuation, between buyers and sellers,” he said.

In 2015 alone, transportation and logistics giant XPO Logistics ate up motor carrier Con-way Inc., ABF Logistics took on Smart Lines Transportation Group and CRST International acquired Pegasus International Inc. UPS, Celadon Group Inc., Maverick USA Inc. and Roadrunner Transportation Systems Inc. all made purchases as well.

But in the second quarter of this year, when professional services firm PricewaterhouseCoopers tracked 51 global transportation and logistics-related mergers and acquisitions, more than half were in Asia. Just eight were in North America.

“There’s always a certain amount of consolidation, probably more in recoveries than in downturns,” said Noël Perry, principal at consulting company Transportation Economics. “But I don’t think it’s as big a deal right now.”

In part, that’s because trucking consolidation is evolving.

Purchases are getting heftier, according to PwC researchers. The average value of a transportation and logistics deal is now $670 million, more than 25 percent higher than it has been over the past three years.

Acquisitions could become more global as foreign power players expand their routes internationally. Deal value in the trucking subsector surged 69 percent from a year earlier — mostly because of the monstrous $16.8-billion purchase in China of SF Holding Co. by Maanshan Dingtai Rare Earth & New Materials Co., according to PwC.

For the time being, though, buyers abroad are “looking almost exclusively to buy asset-light beachheads in the U.S.,” Larkin said. So any near-term truckload activity will likely involve only American or Canadian companies.

But even within the U.S., companies are shifting from truck-only systems toward intermodal alternatives or supplementing their operations with third-party logistics providers.

Intermodal traffic – which involves moving products via multiple modes of transportation, including trucks – grew for 25 straight quarters until weak freight demand triggered a 6.1- percent year-over-year decline in the second quarter, according to the Intermodal Assn. of North America.

And for third-party logistics providers, there were already 11 acquisitions valued at more than $100 million before the end of 2015 – a record high, according to supply chain consultancy Armstrong & Associates Inc.

Although small companies still vastly outnumber large ones, the middle ground between them is falling away. New legislation – such as the recent electronic logging mandate requiring truck drivers to electronically log their time on the road – is expected to sap capacity.

The freight landscape shows signs of gradually becoming broader and less regional. Larger trucking operations mean that shippers can rely on a single carrier to take their loads nationwide.

Their streamlined systems often lead to better purchasing power, lower per-unit costs, newer vehicles with better mileage and a better shot at profitability. Substantial size also tends to equate to higher credibility and access to credit as well as superior insurance.

But with less competition, some are concerned that customer service will suffer. XPO cut more than 100 Con-way jobs earlier this year after buying the company.

“What that does is it in effect destroys the culture of the companies,” said entrepreneur Don Daseke, who runs open-deck flatbed company Daseke Inc. “In the interest of ‘efficiency,’ accountability for each company goes away.”

Daseke founded the Addison, Texas, company in 2008 with no experience in trucking. The business, which is profitable, went from 60 tractors and 120 trailers in 2009 to 2,200 company-owned trucks, another 800 leased from owner-operators and more than 6,000 trailers last year. Revenue rose from $30 million to $678 million.

That’s because Daseke is constantly adding new companies to its roster. The firms – all already profitable on their own – are given capital and allowed to retain all their workers and autonomy.

WTI Transport

WTI Transport is one of the companies owned by Daseke. (Photo: Truck PR/Flickr)

In the past two years, the company purchased Hornady Transportation of Monroeville, Ala., Bulldog Hiway Express of Charleston, S.C., and Lone Star Transportation of Fort Worth, Texas.

“We don’t follow the normal rules of how you consolidate,” Daseke said.

Source: Trucks.com

Improving communication in Truck Maintenance

Posted on by Rick Williams

 

 

A telematics-based diagnostics service gives Central Oregon Truck Co. the opportunity to “plan” a truck to a shop that can support the repair.

Communication plays a critical role in truck maintenance, whether it’s the driver telling dispatch of a need, or a shop updating the fleet on a repair’s status.

As drivers focus more on their own efficiency than the truck’s mechanical performance, diagnostics capabilities have become a linchpin in the communication process between the driver’s seat and the fleet.

“You get immediate visibility of emissions-disabling-type faults,” says Phil Taylor, Central Oregon Truck Co.’s vice president of maintenance, who estimates the company has 75 tractors operating on Kenworth’s TruckTech+. “It gives us an opportunity to communicate with the driver. You can actually make the driver part of the process.”

Taylor says a telematics-based diagnostics service gives the Oregon-based fleet the opportunity to “plan” a truck to a shop that will have both the capacity and the parts to support the repair.

“There’s a few things we can do to overcome an out-of-service event based on those [fault] codes,” he says.

Previously, the company would populate the fault codes through its PeopleNet-powered mobile communications system, which wouldn’t provide information about potential local service providers or the code’s severity.

“With the technology on these trucks, understanding and education leads to making that driver part of the process and making him understand what’s going on.”

— Phil Taylor, Central Oregon Truck Co.’s vice president of maintenance

“Today, we can see on a scale of one to five how severe the problem is,” Taylor says.“Is it something we need to deal with right now, or is it something we can deal with when a driver is out of service or expired? It gives us a lot of information that we can manage by.”

Of all the benefits reaped from a remote diagnostics platform, the one that stands out most is the improvement in communication “from the truck to the fleet,” Taylor says. “Although the communication is coming via a call center, we’re getting those notifications in real time so that it allows us to get ahead of the issue, typically prior to failure.”

When a fault surfaces, the entire company is pulled into the loop and can take action from there, Taylor says.

“Those codes and everything you get, they also go to our operational team so that they know how to adjust,” he says. “If we have a fault code, what do we do for the driver? We can respond to it earlier. We can make adjustments and avoid a service failure to a customer or, more immediately, to the driver.”

Getting ahead of a failure allows Central Oregon to maximize the driver’s and the truck’s uptime. “Our goal is to always plan general maintenance activity when a driver’s hours of service are expired,” Taylor says.

Tim Gray, remote diagnostics coordinator for Averitt Express (CCJ Top 250, No. 21), says that drivers for the Cookeville, Tenn.-based company “really like the peace of mind where someone else is monitoring their tractor.”

“The information a driver can provide is essential. What [telematics] does is it essentially allows an alert to go out that allows us to reach out to the driver and ask them if they are experiencing problems, to potentially help them identify things they can’t hear. What they are experiencing in the vehicle is still valuable information.”

— Sherry Sanger, Penske Truck Leasing’s senior vice president of marketing

Averitt has eight breakdown coordinators that provide around-the-clock monitoring. “We want them to know that they’re operating a safe piece of equipment,” he says.

The flow of information also has helped replace the mechanical ability that Taylor says many of today’s new drivers seem to have lost.

“It used to be that drivers out on the road were kind of gearheads – they had a lot of mechanical aptitude,” he says. “Today, we don’t see that capability or that aptitude on the driver end.”

While some millennial drivers may be less mechanically inclined, they tend to understand the codes and electronic notifications coming from the ECM, Taylor says.

“With the technology on these trucks, understanding and education leads to making that driver part of the process and making him understand what’s going on,” he says, adding that drivers frequently understand the technology but not how it affects them.

“Part of it is learning how to make our drivers successful,” Taylor says. “How do we allow them to understand and be part of the process?”

The flow of communication from the truck was designed to supplement, not replace, the feedback coming from the driver’s seat, says Sherry Sanger, Penske Truck Leasing’s senior vice president of marketing.

“The information a driver can provide is essential,” Sanger says. “What [telematics] does is it essentially allows an alert to go out that allows us to reach out to the driver and ask them if they are experiencing problems, to potentially help them identify things they can’t hear. What they are experiencing in the vehicle is still valuable information.”

By Jason Cannon 

 

Credit: CCJ

Papé Kenworth’s Service Excellence Helps Keep Central Oregon Truck Co. Rolling

Posted on by Rick Williams

Papé Kenworth, led by president Dave Laird, has a vision for the kind of service Central Oregon Truck Co. and other customers need for their trucks while they’re traveling.

 

Depending on how quickly issues need to be fixed, Central Oregon Truck Company dispatchers and technicians could use Kenworth TruckTech+ to schedule loads that can get the driver and truck back to the company’s maintenance shop in Redmond.
Depending on how quickly issues need to be fixed, Central Oregon Truck Company dispatchers and technicians could use Kenworth TruckTech+ to schedule loads that can get the driver and truck back to the company’s maintenance shop in Redmond.
Depending on how quickly issues need to be fixed, Central Oregon Truck Company dispatchers and technicians could use Kenworth TruckTech+ to schedule loads that can get the driver and truck back to the company’s maintenance shop in Redmond. Justin MacDonald (L), a mechanic with Papé Kenworth — Redmond, welcomes Central Oregon Truck Company’s maintenance shop foreman Travis Seeger as he brings in a Kenworth T680 to be checked out by the dealership’s maintenance shop. Justin MacDonald (L), a mechanic with Papé Kenworth — Redmond, goes over the service schedule for Central Oregon Truck Company’s Kenworth T680 with COTC maintenance shop foreman Travis Seeger. Papé Kenworth’s Jerrid Langdon (L), provides Central Oregon Truck Company maintenance shop foreman Travis Seeger his expertise in keeping high-demand parts in stock for the company maintenance shop, which handles routine preventive maintenance on a fleet of 250 Kenworth trucks.

Papé Kenworth, led by president Dave Laird, has a vision for the kind of service Central Oregon Truck Co. and other customers need for their trucks while they’re traveling.

“It’s really no secret — if their trucks have an issue on the road, our customers want to know what the problem is, they want it fixed quickly, and they don’t want to sweat the unknowns,” Laird said. “And through our concierge service, that’s what we strive to deliver for Central Oregon Truck Company (COTC) and our other customers. Our goal is to give them peace of mind by managing the process from beginning to end. We know the only way our customers make money is when they’re rolling. So, it’s our charter, and vision, to make that happen. And, do it better than anyone in the industry.”

While COTC’s chief executive officer, Rick Williams, likes that vision, he likes how Papé Kenworth executes it even more.

“Papé Kenworth established a single person to act as a go-between — a coordinator who can contact other Kenworth dealers for us, making the whole process of scheduling service and repairs and obtaining updates seamless,” Williams said. “This dealer-to-dealer exchange is much more efficient than having our employees try to do the same thing because the Papé Kenworth coordinator knows the people on the other end of the line.”

Including its Redmond dealership, which is located next door to COTC, Papé Kenworth operates seven Oregon locations, four Central California locations and one Washington location. Earlier this year, Papé Kenworth was named the 2015 Kenworth Dealer of the Year for the United States and Canada at Kenworth’s annual dealer meeting.

“When our trucks need repairs or service on the road, it can be difficult for our company’s driver concierge or dispatchers to figure out whom to call to get firm estimates or timeframes for repairs,” explained Phil Taylor, COTC vice president of maintenance. “Papé Kenworth does all of that for us.”

Taylor said he believes Kenworth TruckTech+ remote diagnostics system, which came standard on COTC’s newest Kenworth T680s equipped with PACCAR MX-13 engines, will make that job much easier for Papé Kenworth. TruckTech+ delivers a powerful tool to technicians to help them better manage any fault codes that may be triggered from time-to-time. COTC has 36 Kenworth T680s equipped with TruckTech+ that all will be operating soon.

“The system interprets the fault codes and then provides us information and recommended actions based on the severity of the issue,” Taylor explained. “We can then determine whether the issue requires immediate attention or if our driver can continue driving, satisfy the load and have the problem addressed immediately afterwards or when the driver returns to the company’s headquarters. TruckTech+ also can provide technicians at Kenworth dealerships and our company’s shop a much more complete look at the circumstances and conditions surrounding issues as they occur on the road.

“Since it displays a variety of information such as engine speed and temperature, ambient temperature and exhaust gas temperature, the technician may be better able to remotely diagnose the issue or at least narrow down the possible causes,” he added. “Depending on how quickly the issue needs to be fixed, our dispatchers and technicians could use TruckTech+ to schedule loads that can get the driver and truck back to our maintenance shop in Redmond. Then our shop or the people at Papé Kenworth can address the issue during the driver’s time off.”

TruckTech+, which COTC dispatchers and managers access via a web portal, also provides a map that displays the locations of the company’s trucks. With the click of a mouse, they can obtain weather information plus traffic patterns for the surrounding area around the trucks. That could allow them to direct drivers around congested areas or storm cells.

Papé Kenworth’s service coordination for COTC helped it to earn the company’s gratitude and Kenworth’s Dealer of the Year award. Not surprisingly, Papé Kenworth is one of Kenworth’s leading dealers in the PremierCare Gold Certified program with four gold-certified locations — Bakersfield and Fresno, Calif., and Medford and Portland, Ore.

Under that program, certified dealers go above and beyond Kenworth PremierCare dealers to help fleets and truck operators to minimize downtime with a range of premium services, including extended evening and weekend operating hours and dedicated TruckTech+ personnel. A hallmark of the program is a rapid diagnosis of estimated repair time in two hours or less.

“I wasn’t surprised at all when Kenworth announced Papé Kenworth as its Dealer of the Year,” said Williams, who attended the dealer meeting as a guest panelist. “Papé Kenworth is a great partner to our company because their people understand that when one of our trucks is down, then our customer is down because we haul many just-in-time loads to manufacturing facilities. The truck is our revenue source. The employees at Papé Kenworth recognize that we need to get it back on the road making money because every hour it’s not running, that’s time we can never get back.”

“Papé Kenworth’s concierge program coordinator has been working with our company’s driver concierge on establishing training parameters for company dispatchers and drivers in what kinds of information TruckTech+ gathers, when and where it will be delivered and how to make the best use of it,” Taylor said.

Taylor said while TruckTech+ is a welcome technological addition to the company’s toolbox, and could automate some of the work Papé Kenworth’s concierge currently does.

Taylor said Papé Kenworth’s success in serving COTC needs comes not only in the strength of the Kenworth dealer network, but also in the relationships and contacts Laird and others in the Papé Kenworth dealer group have developed over the years with other Kenworth dealerships across the United States.

Laird currently serves as the chairman of Kenworth’s 2016 PACCAR MX Engine Dealer Council. Over the past two years, Laird also has served as a member of the Kenworth Dealer Council, which works with Kenworth to develop strong customer support throughout its dealer network.

“So, when we get a call from a driver whose truck requires immediate service, we know we can call someone and within two hours they’ll find out what the issue is and they’ll give us an estimate of how long it will take to get it fixed,” he said. “That way we can inform our customers and determine whether to pick up the load with another truck if necessary and continue its delivery.

“No matter what day or time we call, Papé Kenworth makes it all seamless for us,” Taylor added. “That’s good because our expertise is in hauling building materials and heavy equipment on flatbeds safely and on-time.”

Central Oregon Truck Co. hauls loads for major manufacturers of building products in the lower 48 states and Canada. It is a part of the Addison, Texas-based Daseke family of premier open-deck/specialized transportation companies.

“We’ve come to rely on Papé Kenworth’s expertise in ordering and keeping high-demand parts in stock for our company’s maintenance shop, which handles routine preventive maintenance on our fleet of 250 Kenworth trucks,” he added.

COTC also relies on Papé Kenworth’s experience in helping to choose the right specifications for their T680s to maximize driver comfort, fuel efficiency and effective use of new technologies.

“We’ve been very happy with the performance of our newest Kenworth T680s equipped with PACCAR MX-13 engines, Kenworth Idle Management, Kenworth TruckTech+ and the Bendix Wingman Fusion,” Taylor said.

At Papé Kenworth’s recommendation, COTC was one of the first Kenworth customers to order T680s equipped with the PACCAR engines shortly after they became available in 2012.

“They’ve been performing exceptionally, continuing to provide us great fuel economy,” Taylor added. “The idle management system will help us reduce idling time and the driver assistance system will help our drivers maintain safer distances and better recognize when they’re speeding. TruckTech+ will help us and Papé Kenworth anticipate issues, which will result in our trucks getting back on the road making money more quickly. And when it comes time to replace the Kenworth T680s, we anticipate getting excellent resale values for them.”

For more information, visit www.kenworth.com.

 

Source: Papé Kenworth

Lee Boesch

Posted on by Rick Williams

My husband, Jeff Sims, has worked for COTC for 13 months and they are by far the best company he has ever worked for. I cannot say enough good things about the company. They treat their drivers and spouses like family. Jeff never sits waiting for a load, gets great miles, gets home when his home time is scheduled and the monthly bonus is very attainable. The driver coaches, dispatchers and staff in the office are awesome. Great company – thank you COTC.

Fifth Wheel Maintenance

Posted on by Rick Williams

The fifth wheel is an often-overlooked part of the truck. The fifth wheel secures the truck and trailer and is critical to its safety and maneuverability.   Symptoms of a dry fifth wheel include (but are not limited to) irregular handing, drivetrain `clunking’ noise, and front-end/steering noise and `popping’.

As a matter of practice, Phil Taylor, the VP of Maintenance at Central Oregon Truck, recommends separating your tractor and trailer every two weeks to apply grease to the surface of the fifth wheel appropriately. A fifth wheel can be over-greased. The rule of thumb is that the fifth wheel plate should always appear `wet’ with grease.

COTC’s planned maintenance (‘PM’) always includes separating the trailer from tractor whether the PM activity takes place in Redmond, Oregon or at a TA/Petro Service Center to accommodate greasing the fifth wheel.

Understanding your equipment and ensuring all planned maintenance has been performed today, will prevent a breakdown tomorrow.

Daseke Family of Open Deck Carriers Has More Honors Come its Way

Posted on by Rick Williams

Recognition Lead by Central Oregon Truck Co. and Smokey Point Distributing

Central Oregon Truck Co. driver Carey Loseth relies on Mike Gillaspie, a company driver concierge, to arrange cleaning, maintenance and other necessities for his company truck upon his return to the company's headquarters in Redmond, Oregon. COTC's driver concierge program is one of several reasons why the flatbed and specialty carrier was named by the Truckload Carriers Association for a third consecutive year as one of North America's 20 Best Fleets to Drive For. (Photo: Business Wire)

Central Oregon Truck Co. driver Carey Loseth relies on Mike Gillaspie, a company driver concierge, to arrange cleaning, maintenance and other necessities for his company truck upon his return to the company’s headquarters in Redmond, Oregon. COTC’s driver concierge program is one of several reasons why the flatbed and specialty carrier was named by the Truckload Carriers Association for a third consecutive year as one of North America’s 20 Best Fleets to Drive For. (Photo: Business Wire)

ADDISON, Texas–(BUSINESS WIRE)–It never gets old. Recognition of their people, that is, for the Daseke family of companies. And for Don Daseke, president and CEO of Daseke Inc., the latest recognition by the Truckload Carriers Association (TCA) and CarriersEdge may be the most meaningful.

Daseke honors mount as COTC earns TCA threepeat, Boyd Bros named fleet to watch and SPD wins top safety award.

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“We’ve built a world-class organization of flatbed, specialized carriers and having Central Oregon Truck Company (COTC) named for the third consecutive year as one of North America’s 20 Best Fleets to Drive For(R) was terrific,” said Daseke. “But even more so was the fact that the majority of our companies – six of them – placed in the top 63 of all carriers. That truly is something and validation that people truly do make the difference at Daseke. We are proud of the family atmosphere at our companies, which has led several of our companies to have driver turnover rates of less than 25 percent.”

While COTC was the big winner amongst the Daseke companies, Boyd Bros. was chosen in the “Fleets to Watch” category, coming in the top 25 of all fleets. Smokey Point Distributing, WTI Transport, Bulldog Hiway Express and J. Grady Randolph were the other Daseke companies that placed in the finals.

“We were also extremely pleased that Smokey Point was a recognized safety winner,” said Daseke. “They were crowned as TCA’s safest fleet – coming in first place in the 15-24.99 million-mile division. This was on the heels of Smokey Point receiving its fifth consecutive Platinum Safety Award from Great West Casualty. SPD truly has a remarkable safety record; safety is top of mind for all our companies, and we’re proud of the Daseke record when it comes to the safe, on-time delivery of freight to our customers.”

According to Cale Pearson, president of Central Oregon Truck Company, listening to drivers and implementing their suggestions have made a difference at the Redmond, Ore.-based company. “Since our company was founded by drivers, we’ve always had a ‘driver-first’ mentality,” he said. “Our driver retention rate has been going up every year and it really results from working closely with drivers. We implemented a driver concierge program this past year — when a driver comes into our facility, he’s immediately greeted and asked about the trip. But, it’s more than that … we ask if he’d like a meal … or if he wants us to get a shower ready. And we ask about any concerns on the tractor or trailer – so we can relay that back to our maintenance department. What we’re doing is giving time back to the driver. The concierge relays all work needs for both the driving team member and the needs of the truck to the necessary departments so the team member can reduce his downtime in the yard, take care of personal needs or just relax.”

According to Don Daseke, all operating companies collaborate closely with each other and have monthly, if not more frequent, meetings to discuss best practices. “We’re all joined together in wanting to improve and that’s what’s so exciting about our company,” he said. “Our CEOs all regularly collaborate with each other, as do our maintenance, finance, safety, operations, recruiting, sales, social media and HR teams. This allows each company to speak freely about what works, and perhaps what doesn’t. There are no secrets, and shared successes have become much more frequent. We have a desire to be the best, and the results we’re seeing show we’re continuing to move the bar higher.”

 

Source: Business Wire

 

Valet Services Available in The Yard

Posted on by Rick Williams

Welcome board, windshield wash station and Valet Services building.

Redmond, OR – COTC offers valet services for our driving team. Services range from topping off your DEF, to reserving a shower, and ordering a sandwich from the deli to make your visit to the yard as productive as possible.

Dave Cressey, is our valet and a former flatbed driver at COTC. He understands the life of an OTR flatbed driver and is here to help.

“I have a lot of the things you will need for your truck and for doing your job in general. I have hot coffee in the winter and cold water in the summer. I have paper work from envelopes to bubble sheets and BOLs. I will put another set of eyes on your truck and trailer help make sure the shop takes care of your equipment before you leave. Tires, you bet! I’ll check those as well. To keep you safe out there and change any tires that are no longer compliant. I have washer fluid, antifreeze and oil to keep your truck running in top condition all through the year.”

 

COTC understands your clock is running when you enter the yard. Sometimes you need to get business done and get back on the road. Other times, you plan to shut down for the night and are looking to catch up with the team, reserve a room, take a hot shower and eat dinner. Let Dave know what you need when you get here and we will make it happen!