- Knight-Swift Transportation acquired six LTL terminals in Q1 to further expand its network, the company revealed during its earnings call last week. The purchase price was not disclosed.
- Five of the terminals are in Texas, and one is in Las Vegas, Nevada, according to a press release. The purchase price or exact locations were not disclosed.
- "A little bit of work" needs to happen to get the facilities ready, President and CEO David Jackson said on the call. The company expects to bring most of the terminals online by the end of the year, though some may delay until 2023.
Knight-Swift executives are not shy about their ambitions: They want to build a national LTL network.
But for a company historically focused on truckload operations to do so, it will require a significant amount of capital investments. Knight-Swift recognized this fact in its 2021 10-K.
"LTL operations are more capital intensive than full truckload operations, including the need for additional terminals and types of equipment," the company wrote.
The terminal-expansion strategy mirrors the playbook at established LTL carriers. Companies like XPO and Old Dominion Freight Line announced investments in new terminals and service centers across the U.S. earlier this year. And Old Dominion has told Transport Dive such investments are critical to its growth strategy.
But for Knight-Swift, purchasing new terminals organically is just one of two paths when it comes to LTL growth.
"We plan to grow the LTL segment through organic growth and acquisitions and believe a national expansion effort will provide enhanced value to our customers," the company said in its 10-K.
Knight-Swift entered the LTL market with a splash when it acquired its way into the national LTL market within a course of six months. In 2021, the truckload carrier acquired regional LTL providers AAA Cooper and MME, which had a combined presence of roughly 100 LTL facilities across the U.S.
"MME is our next step toward a nationwide LTL network," Jackson said in a press release about the MME acquisition in December. "MME and [AAA Cooper] have minimal regional overlap, and we expect they will be a benefit to one another."
But there are still gaps in Knight-Swift's overall network. MME and AAA Cooper brought a sizeable presence in the Northwest and Southeastern U.S., but much of the country is yet unserviced by Knight-Swift. Executives say that is an opportunity for future business deals.
"We continue to look for opportunities to build out our LTL network primarily in the Southwest and the Northeast," said Adam Miller, CFO and Treasurer at Knight-Swift.