In trucking, double-digit revenue growth is respectable, but it’s truly good news when it happens two years running.
The nation’s leading 250 for-hire trucking operations as judged by Commercial Carrier Journal together reported revenues for 2005 that were 14.4 percent higher than the same carriers reported in 2004. Likewise, the CCJ Top 250’s revenues for 2004 were about 14 percent higher than in 2003.
Unusual situations can skew the numbers slightly for the group as a whole. In 2005, the most notable case probably is the rapid expansion of package-delivery heavyweight DHL Express into the U.S. market. That alone represents a couple of percentage points in the CCJ Top 250’s revenue growth; take DHL out of the calculation, and the year-over-year increase is 12.4 percent – still quite strong.
Aside from unusual situations, the fate of industry giants – especially behemoth UPS – can noticeably affect the performance of the whole. In 2005, the effect wasn’t large since UPS’s 16 percent growth was only a bit higher than the industry average. Without UPS, the CCJ Top 250 posted 13.6 percent growth compared to 14.4 percent with it. In 2004, however, UPS’s relatively weak 9.2 percent revenue growth had a greater effect. Excluding UPS, the average increase was 15.8 percent rather than 14 percent with it.
Revenues are, of course, a function of volume and pricing. Indeed, there have been too many years in which trucking companies posted both strong revenue growth and thin or nonexistent margins. Revenues were rising because carriers were growing their underutilized fleets.
There are no signs of that problem in the 2005 numbers, however. In fact, an analysis of carriers for which data was available for both years shows a 2.2 percent decline in the number of power units operated from 2004 to 2005.
This drop doesn’t necessarily indicate a loss of system capacity. For example, if a CCJ Top 250 carrier sold an operation, it would be reflected as a loss to the ranked carriers even if the operation continued under another name. New-entrant capacity and growth among smaller carriers obviously aren’t reflected either. But if the nation’s for-hire trucking fleet were growing significantly, it surely would show up in the CCJ Top 250.
To view CCJ’s Top 250, click here.