US trucking industry deal
US trucking giant Yellow Roadway just got bigger, with the announced acquisition of rival trucking company USF, a $1.7 billion deal. Yellow Roadway is the result of the 2003 merger of the two largest less-than-truckload national trucking companies, and is dominant in its field. USF gives them further reach into regional trucking and next-day delivery. USF runs a network of short-haul divisions through the US.
Less-than-truckload carriers load a number of shipments from multiple companies in the same truck. Short-haul shipments have higher margins than the national shipping Yellow Roadway currently specializes in.
Part of this is the big serving the big. Large corporations want to deal with fewer companies in freight, and companies that have both local and national capabilities. Trucking, traditionally populated by many small companies, is going the way of parcel delivery and the railroad industry.
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