In 1982, David Morgan was preparing to launch a nationwide truckload trucking company. Just as Morgan was ready to roll, Atlanta’s largest drayage company, Southern Region, ceased operations giving Morgan a chance to reconsider his plans.

“Intermodal was not the direction we had planned on taking,” says Morgan, who founded Morgan Southern Inc. after working 10 years at less-than-truckload (LTL) carriers Roadway Express and Yellow Freight System. “I was contacted by a number of shippers who told me there was a huge void in Atlanta and wanted me to take a look at it.” After establishing his corporate headquarters in Atlanta, Morgan branched his drayage services to 10 new major rail centers by 1986, including terminals in Houston, Los Angeles, Miami, Chicago, Memphis, Tenn., and Charlotte, N.C.

“Intermodal is a relatively small community of people who control the business,” Morgan says. “They already controlled business in the locations we opened up and knew who we were.”

Return to the rail
For more than 10 years, intermodal freight was the carrier’s principal business, but responding to market conditions, the company chose to expand its over-the-road division in 1996.

After three years of building this division, however, the cost of equipment – particularly the 3 to 1 trailer-to-tractor ratio – was deteriorating Morgan Southern’s profits, especially during the idle periods of the Christmas holidays through the January slow times, says Ben Kirkland, vice president of operations.

“We were marketing the road and that did help us grow, but it was not the foundation we needed for long term growth and profitability,” Kirkland says. Three years ago, company executives returned their focus to intermodal freight. In hindsight, Kirkland says, the timing was perfect as TL became “soft” and fuel prices suffered a sudden spike in early 2000. The past three years – a period in which many OTR carriers have struggled just to survive – have been the best ever for Morgan Southern. Revenues more than doubled from $16 million to $38 million, Kirkland says.

“We found ourselves in a pretty good position,” Kirkland says. As intermodal once again became Morgan Southern’s core business plan, the company accelerated its growth by acquiring assets, including drivers and customers, from two intermodal carriers that ceased operations: TruckRail Transport in Birmingham, Ala., and Manufacturer’s Cartage in Grand Rapids, Mich. With 430 trucks (230 of which are owner-operators), 60 trailers, and terminals in 16 major U.S. cities, Morgan says the company could feasibly double its sales again within the next few years.