Within the past week, two of the country's leading truckload carriers announced they would be expanding into the potentially lucrative but operationally demanding refrigerated trucking business using team drivers.
On Nov. 7, CRST International Inc. said it has launched an expedited trucking service for temperature-controlled shipments utilizing tandem drivers. On Nov. 14, the president of U.S. Xpress Enterprises Inc. said that his company plans to more than double its fleet of trucks dedicated to refrigerated service, and that it will also use team drivers.
CRST, based in Cedar Rapids, Iowa, said the new service is a division of CRST Expedited, one of its operating units. In a statement, Dave Rusch, president and CEO of CRST, said the service will run coast-to-coast in two-and-a-half days at rates that are competitive with services using solo drivers. Those hauls generally take twice as long, Rusch said.
U.S. Xpress, based in Chattanooga, plans to expand its reefer fleet to 250 team trucks, up from its current fleet of 100. CEO John White told **italic{DC Velocity} that the expansion will affect just a fraction of the carrier's 5,500-rig fleet. "It helps us expand our scope of services," White said.
A form of what is known as "specialized" trucking, refrigerated transport is a relatively fast growing segment of the industry. It usually commands higher margins than the dry van operations that account for the bulk of truck moves in the United States. It is also one of the few areas where motor carriers are making "net capacity additions," meaning equipment is being brought on as part of a service expansion and not to replace existing tractors and trailers.
Refrigerated transportation requires more specialized skills and knowledge, is more capital- and labor-intensive, and is more time-sensitive than dry van service because of the perishable nature of the commodities being hauled. A late, missed, or mishandled delivery may cause the product to be disposed of as unfit for sale.
Separately, U.S. Xpress said it would be expanding its expedited, or time-sensitive, delivery business by bringing on smaller vehicles to supplement the 53-foot vans traditionally used for the service, according to White. It plans to expand to 200 trucks by late 2012, up from 12 trucks currently.
In addition, the carrier plans to add 100 trucks to its Northeast U.S. operations, which stretches from Maine to Maryland, White said. The additions will bring to 300 the number of rigs dedicated to that region.
Gartner, Inc.