Transportation & Logistics Industry Update
Our Outlook on 2019
Activity is strong and steady within transportation and logistics and the automotive aftermarket, according to Managing Directors Jason Bass, Frank Mountcastle and Joe Conner.
Investor and buyer attention is especially focused on third-party logistics (3PL) businesses benefiting from booming e-commerce, as well as in essential automotive services with recession-resistant demand.
What We’re Reading
Warehouses have experienced surging demand since 2012 as e-commerce continues to grow. Construction in the sector is thriving. Now, "reverse logistics," a term for dealing with e-commerce returns, is the No. 1 new user of warehouse space in the United States, taking up to 700 million square feet nationally, according to commercial real estate services and investment firm CBRE.
Data on producer prices shows that overall inflation pressure calmed further in December. However, industry detail showed that trucking rates continued to surge, driven by another large gain in long-distance trucking rates.
As United States intermodal volumes continue to remain ahead of carload volumes, a report recently published by Chicago-based commercial real estate firm JLL explains that increased intermodal usage will not only see supply chains drive more cargo off of highways on to rail, but it will also serve as a driver to increase real estate development in close proximity to inland ports.
Seaports on the West, East, and Gulf coasts are all poised to compete on one major imperative: investment in transformational technologies. As 2018 came to a close, U.S. logistics managers witnessed unsurpassed inbound container traffic through the nation’s largest ocean cargo gateways. But industry analysts warn that a variety of disruptive factors may demand more creative solutions from port stakeholders to remain competitive.
Despite capacity beginning to exceed demand in December 2018, Chuck Clowdis, managing director of the consultancy Trans-Logistics Group, Inc., believes carriers will see continued strength air cargo pricing. “The explosive growth in on-line shipping along will keep the air cargo sector very healthy for 2019,” says Clowdis.
Public Markets Overview1
Stock Price Performance1
Harris Williams is a leading advisor to the transportation and logistics M&A market. Our Transportation & Logistics Group serves companies in a broad range of attractive niches, including third-party logistics (3PL), truck, rail, marine and air transportation, transportation equipment, and the automotive and heavy duty vehicle market.
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