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Home » Old Dominion targets smaller rivals in bid to boost market share
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Old Dominion targets smaller rivals in bid to boost market share

February 17, 2011
Mark B. Solomon
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Old Dominion Freight Line Inc., one of the nation's most successful less-than-truckload (LTL) carriers, aims to reach $3 billion in annual revenue in five years, a figure roughly double the revenue the carrier reported in 2010, its president and CEO said Wednesday.

David S. Congdon told the transportation and logistics conference sponsored by investment firm Stifel, Nicolaus & Co. in Key Biscayne, Fla., that the company will seek to take market share from rivals in the second-tier category, below the top 25 LTL carriers. Those smaller companies account for about $5 billion of the $35 billion U.S. LTL market, he said.

Smaller carriers may have trouble competing because of their lack of scale, their inability to price their services competitively, and their relative dearth of products, Congdon said. Those firms will likely go out of business, combine with one another, or be candidates for acquisition, he added.

Congdon forecast that 85 to 90 percent of Old Dominion's growth will come from its traditional domestic LTL business. The rest will come from value-added services such as drayage, warehousing and distribution, and third-party logistics, he said.

In 2010, Old Dominion reported revenue of $1.49 billion, a 19-percent increase from 2009 totals.

Old Dominion, based in Thomasville, N.C., holds an 8 percent LTL market share in the South, its strongest region in the United States. Congdon said the carrier's first-quarter yields—measured by revenue per hundredweight—will rise 4 to 6 percent, excluding fuel surcharges.

Old Dominion is considered one of the strongest LTL carriers in the country. In introducing Congdon, David Ross, a Stifel analyst, said Old Dominion was the most operationally profitable publicly held trucker that Stifel covers.

Transportation Trucking Less-than-Truckload
KEYWORDS Old Dominion Freight Line
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Marksolomon
Mark Solomon joined DC VELOCITY as senior editor in August 2008, and was promoted to his current position on January 1, 2015. He has spent more than 30 years in the transportation, logistics and supply chain management fields as a journalist and public relations professional. From 1989 to 1994, he worked in Washington as a reporter for the Journal of Commerce, covering the aviation and trucking industries, the Department of Transportation, Congress and the U.S. Supreme Court. Prior to that, he worked for Traffic World for seven years in a similar role. From 1994 to 2008, Mr. Solomon ran Media-Based Solutions, a public relations firm based in Atlanta. He graduated in 1978 with a B.A. in journalism from The American University in Washington, D.C.

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