The $46 billion less-than-truckload (LTL) market, plagued by high fixed costs and sometimes awkward labor relations, has rebounded to become a cash cow over the past two years.
“Customers are afraid to change carriers today for fear of not having enough capacity,” says Chuck Hammel, president of LTL mainstay Pitt Ohio. “In fact, they’re all paying big prices for capacity.”
How big? How about double-digit percentage increases, often twice in the past year, confirms Hammel. “Our existing business understands this, and it’s no longer just a 12-month contract,” he says. “We go to them throughout the year and say: ‘Here’s the way it is.’ It’s customer by customer, but we try not to cross-subsidize any freight.”