FedEx, a company whose name was once almost synonymous with overnight delivery service, is now officially in the longhaul LTL business. Last month, FedEx Corp. announced that it had completed its acquisition of longhaul less-than-truckload (LTL) carrier Watkins Motor Lines, under terms of an agreement announced in May.
As part of the $780 million deal, FedEx also acquired LTL carrier Watkins Canada Express. Watkins Motor Lines and Watkins Canada, which combined operate more than 140 service centers and a fleet of 14,000 tractors and trailers, will be re-branded as FedEx National LTL and FedEx Freight Canada. They become part of the FedEx Freight operating business, which until the acquisition focused primarily on next-day and second-day LTL service.
FedEx began its expansion into the surface transportation business nearly a decade ago when it purchased Caliber System, whose operating companies included surface package carrier RPS, critical shipments specialist Roberts Express, and Viking Express, a regional LTL carrier in the Western United States. It later added American Freightways, a regional carrier reaching most of the Eastern United States. (Viking and American Freightways were joined to form FedEx Freight. RPS was re-branded as FedEx Ground, and Roberts as FedEx Custom Critical.)
FedEx'smajor rival, UPS, has also expanded well beyond its roots in the surface parcel delivery business. Last year, it acquired Overnite Corp., whose major business was Overnite Transportation, a multi-regional LTL carrier.
FedEx sees the addition of Watkins as an important extension of its motor freight business. In a statement announcing the deal's completion, FedEx Chairman, President and CEO Frederick W. Smith said, "FedEx Freight, FedEx National LTL and FedEx Freight Canada create a reliable, single-source provider of one- and twoday regional as well as longhaul LTL services that customers have been requesting."