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.
The president and CEO of Old Dominion Freight Line Inc. said Tuesday that the less-than-truckload (LTL) carrier will likely hire at least 1,150 truck drivers in 2012, following the hiring of approximately the same number of drivers in 2011.
David S. Congdon said the Thomasville, N.C.-based company currently employs 6,500 over-the-road and local pickup and delivery drivers, and generally experiences 10-percent annual turnover. That means Old Dominion will need to hire 650 drivers just to fill the void and an additional 650 drivers to keep up with the company's volume growth, he told DC Velocity in a telephone interview.
Old Dominion's third-quarter tonnage rose 9.6 percent over the same period a year ago. It has projected 9- to 10-percent tonnage growth in the fourth quarter over the year-earlier period. Congdon declined to give tonnage projections for 2012.
By the end of 2011, the company will have hired 1,150 drivers, Congdon said. Of those, 500 drivers will have been brought on to handle increased volumes, while the remaining 650 drivers would be recruited to offset the loss of 10 percent of its driver force.
Of the drivers who left, about half departed due to retirement or simply decided to get out of the profession. The other half were terminated as a result of specific performance-related issues or incidents, Congdon said.
Low turnover rate
Old Dominion pays its over-the-road drivers between $55,000 and $80,000 a year, and its local drivers between $45,000 and $60,000. Congdon attributed Old Dominion's relatively low driver turnover rate to the company's decision to pay above-scale wages and to its "predictable schedules" that allow drivers to make their runs and still be home with their families on a regular basis.
Congdon said providing truck drivers with a "proper work-life balance" and ensuring drivers are treated with dignity and respect should be a trucker's top two priorities if it wants to attract and retain qualified drivers. Wages and benefits, though important, are often as low as fourth on a driver's list of concerns, Congdon said.
Because of its relatively stable schedules and shorter hauls, the LTL segment is considered a more attractive place for drivers to hang their hats. The truckload segment has more problems keeping drivers because of its longer hauls and its propensity to operate one-way trips over irregular routes.
Congdon said that if truckload carriers want to secure drivers, they will likely need to move more into "dedicated carriage," a service where a trucker dedicates equipment and drivers to an individual shipper. Dedicated services, which are established by contract, offer predictable schedules that drivers will find appealing, said Congdon, whose company doesn't operate in the truckload segment.
Congdon, whose company earlier this year took a 4.9-percent increase on non-contractual traffic, wouldn't comment in detail on the rate outlook for 2012. However, he said rates must continue to rise to allow truckers to offset escalating operating costs. "We are now paying more than $100,000 for a tractor. Five years ago, it was $70,000," he said.
Congdon said Old Dominion is focused more on helping customers improve their packaging and handling efficiencies than in imposing a succession of rate increases. "Rate increases are the last thing we want to do right now," he said.
Great expectations
Old Dominion is considered by many analysts to be the country's top LTL carrier, as well as one of the best-run companies in the entire transportation industry. In its third quarter, revenue hit a record $494.5 million, a 24.9-percent increase over the same period in 2010. Net income rose 58.4 percent to $38.6 million.
For the first nine months of 2011, revenue increased 29.1 percent to $1.40 billion from $1.08 billion for the same period in 2010. Net income increased 85.8 percent to $99.6 million from $53.6 million in the first nine months of 2010.
Old Dominion's operating ratio, defined as operating expenses divided by revenues, improved to a record 86.2 percent in the third quarter, the company said. An operating ratio of 90 percent or lower means that expenses are running behind revenues, and is usually a reflection of a well-managed trucking company.
In February, Congdon announced that Old Dominion had set a goal to achieve $3 billion in annual revenues within five years. That figure would be about double its current revenue.
In August, Old Dominion said it would launch a third-party logistics (3PL) unit, Vault Logistics, to respond to customer demands for increasingly complex supply chain solutions. The unit will operate as an independent division within Old Dominion and also as a neutral third-party service provider, meaning it can use carriers other than Old Dominion if customer needs warrant.
Congdon said in the interview the unit would be an increasing focus of top management's attention in the coming year.
Warehouse automation orders declined by 3% in 2024, according to a February report from market research firm Interact Analysis. The company said the decline was due to economic, political, and market-specific challenges, including persistently high interest rates in many regions and the residual effects of an oversupply of warehouses built during the Covid-19 pandemic.
The research also found that increasing competition from Chinese vendors is expected to drive down prices and slow revenue growth over the report’s forecast period to 2030.
Global macro-economic factors such as high interest rates, political uncertainty around elections, and the Chinese real estate crisis have “significantly impacted sales cycles, slowing the pace of orders,” according to the report.
Despite the decline, analysts said growth is expected to pick up from 2025, which they said they anticipate will mark a year of slow recovery for the sector. Pre-pandemic growth levels are expected to return in 2026, with long-term expansion projected at a compound annual growth rate (CAGR) of 8% between 2024 and 2030.
The analysis also found two market segments that are bucking the trend: durable manufacturing and food & beverage industries continued to spend on automation during the downturn. Warehouse automation revenues in food & beverage, in particular, were bolstered by cold-chain automation, as well as by large-scale projects from consumer-packaged goods (CPG) manufacturers. The sectors registered the highest growth in warehouse automation revenues between 2022 and 2024, with increases of 11% (durable manufacturing) and 10% (food & beverage), according to the research.
The logistics tech provider Körber Supply Chain Software continues to position itself in a fast-changing business landscape, aligning itself today with the digital transformation consulting firm Zero100.
Körber Supply Chain Software—to be formally known as Infios beginning in March—has plenty of funding to make those strategic changes, since the company is a joint venture between its parent company, the German business technology powerhouse Körber AG and KKR, the California-based merger and acquisition specialist.
London-based Zero100 calls itself a membership-based intelligence company connecting, informing, and inspiring the world’s supply chain leaders to accelerate progress on digital supply chain transformation. In January the company gained new financial backing through a “growth investment” from the private equity firm Levine Leichtman Capital Partners. According to Zero100, that new financing will accelerate its tech, data, research, and talent capabilities, further strengthen its team, and enable further product and service innovation on behalf of the company’s customers.
Infios says it is joining that community to access Zero100’s data-driven research insights and advisory, and to integrate innovative sustainability practices and digital tools into its adaptable solutions. Infios’s catalog of technology includes order management, warehousing and fulfillment, and transportation management.
By harnessing advanced technologies such as AI and data analytics and providing businesses with the right level of flexibility and control to evolve and adapt solutions to their needs, Infios says it can help its customers optimize their entire supply chain ecosystem and create a more optimistic outlook.
The Swedish supply chain software company Kodiak Hub is expanding into the U.S. market, backed by a $6 million venture capital boost for its supplier relationship management (SRM) platform.
The Stockholm-based company says its move could help U.S. companies build resilient, sustainable supply chains amid growing pressure from regulatory changes, emerging tariffs, and increasing demands for supply chain transparency.
According to the company, its platform gives procurement teams a 360-degree view of supplier risk, resiliency, and performance, helping them to make smarter decisions faster. Kodiak Hub says its artificial intelligence (AI) based tech has helped users to reduce supplier onboarding times by 80%, improve supplier engagement by 90%, achieve 7-10% cost savings on total spend, and save approximately 10 hours per week by automating certain SRM tasks.
The Swedish venture capital firm Oxx had a similar message when it announced in November that it would back Kodiak Hub with new funding. Oxx says that Kodiak Hub is a better tool for chief procurement officers (CPOs) and strategic sourcing managers than existing software platforms like Excel sheets, enterprise resource planning (ERP) systems, or Procure-to-Pay suites.
“As demand for transparency and fair-trade practices grows, organizations must strengthen their supply chains to protect their reputation, profitability, and long-term trust,” Malin Schmidt, founder & CEO of Kodiak Hub, said in a release. “By embedding AI-driven insights directly into procurement workflows, our platform helps procurement teams anticipate these risks and unlock major opportunities for growth.”
Here's our monthly roundup of some of the charitable works and donations by companies in the material handling and logistics space.
For the sixth consecutive year, dedicated contract carriage and freight management services provider Transervice Logistics Inc. collected books, CDs, DVDs, and magazines for Book Fairies, a nonprofit book donation organization in the New York Tri-State area. Transervice employees broke their own in-house record last year by donating 13 boxes of print and video assets to children in under-resourced communities on Long Island and the five boroughs of New York City.
Logistics real estate investment and development firm Dermody Properties has recognized eight community organizations in markets where it operates with its 2024 Annual Thanksgiving Capstone awards. The organizations, which included food banks and disaster relief agencies, received a combined $85,000 in awards ranging from $5,000 to $25,000.
Prime Inc. truck driver Dee Sova has donated $5,000 to Harmony House, an organization that provides shelter and support services to domestic violence survivors in Springfield, Missouri. The donation follows Sova's selection as the 2024 recipient of the Trucking Cares Foundation's John Lex Premier Achievement Award, which was accompanied by a $5,000 check to be given in her name to a charity of her choice.
Employees of dedicated contract carrier Lily Transportation donated dog food and supplies to a local animal shelter at a holiday event held at the company's Fort Worth, Texas, location. The event, which benefited City of Saginaw (Texas) Animal Services, was coordinated by "Lily Paws," a dedicated committee within Lily Transportation that focuses on improving the lives of shelter dogs nationwide.
Freight transportation conglomerate Averitt has continued its support of military service members by participating in the "10,000 for the Troops" card collection program organized by radio station New Country 96.3 KSCS in Dallas/Fort Worth. In 2024, Averitt associates collected and shipped more than 18,000 holiday cards to troops overseas. Contributions included cards from 17 different Averitt facilities, primarily in Texas, along with 4,000 cards from the company's corporate office in Cookeville, Tennessee.
Electric vehicle (EV) sales have seen slow and steady growth, as the vehicles continue to gain converts among consumers and delivery fleet operators alike. But a consistent frustration for drivers has been pulling up to a charging station only to find that the charger has been intentionally broken or disabled.
To address that threat, the EV charging solution provider ChargePoint has launched two products to combat charger vandalism.
The first is a cut-resistant charging cable that's designed to deter theft. The cable, which incorporates what the manufacturer calls "novel cut-resistant materials," is substantially more difficult for would-be vandals to cut but is still flexible enough for drivers to maneuver comfortably, the California firm said. ChargePoint intends to make its cut-resistant cables available for all of its commercial and fleet charging stations, and, starting in the middle of the year, will license the cable design to other charging station manufacturers as part of an industrywide effort to combat cable theft and vandalism.
The second product, ChargePoint Protect, is an alarm system that detects charging cable tampering in real time and literally sounds the alarm using the charger's existing speakers, screens, and lighting system. It also sends SMS or email messages to ChargePoint customers notifying them that the system's alarm has been triggered.
ChargePoint says it expects these two new solutions, when combined, will benefit charging station owners by reducing station repair costs associated with vandalism and EV drivers by ensuring they can trust charging stations to work when and where they need them.