The less-than-truckload field’s largest network alliance — the sprawling, multicarrier Reliance Network of regional carriers — is undergoing some changes, expanding its reach on the West Coast while trading one former partner for two new ones.
Mountain Valley Express of Manteca, Calif., and Peninsula Truck Lines of Auburn, Wash., joined the alliance, while DATS Trucking, Hurricane, Utah, left the group to form a partnership with a California LTL carrier, Best Overnite Express of Irwindale.
|The shifting alliance is a sign of the volatility in the LTL markets and the increasing strength of regional operators.
Regional carriers including Reliance members Pitt Ohio Express and Averitt Express recently reported strong month-to-month increases in volume in March and April. Those increases rolled on in May, said Geoff Muessig, chief marketing officer and executive vice president at Pitt Ohio.
“We’ve seen strong gains in the past 60 days,” Muessig told The Journal of Commerce late last month. “It’s been a nice return — we’ve been wandering in the desert for so long.”
Statistics from some of larger publicly owned competitors suggest Muessig’s gains are no mirage. Tonnage increased 10 to 11 percent at Old Dominion Freight Lines in April, while YRC Worldwide reported an 8.1 percent year-over-year gain at its regional carriers.
Shipping at YRC subsidiaries Holland, New Penn and Reddaway outpaced volume gains at nationwide sister company YRC, which reported a 7.1 percent increase.
A broader measure of the freight moving in truck trailers, the American Trucking Associations’ For-Hire Truck Tonnage Index, shot up 9.4 percent from a year ago in April, hitting its highest level since September 2008. The seasonally adjusted index increased 0.9 percent in April from March, following a 0.4 percent rise over February.
“Truck tonnage continues to improve at a solid, yet sustainable, rate,” boosted by robust manufacturing and stronger retail sales, ATA Chief Economist Bob Costello said.
Those tonnage gains provide the backdrop for the shift at Reliance, as its core carriers work to expand their reach in the U.S. West and former member DATS enters a new partnership to bolster its business and expand in its core western territory.
“Our strategic alliance will focus on consolidating efforts specifically in the states of California and Nevada,” DATS said in a statement. “Best Overnite will manage all operations in California, while DATS will do the same in our core states.”
For Reliance, “We recognized the freight volume is along that I-5 corridor, and we need strong representation there,” Muessig said. Mountain Valley Express and Peninsula anchor both ends of that corridor, he said, from Southern California to the Pacific Northwest. “Each is a leader in regional transportation in their respective markets. They bring us increased sales coverage and a better knowledge of these markets.”
With nine service centers, Mountain Valley Express specializes in overnight and expedited LTL service in nine western states. Founded in 1976, its president is Scott Blevins, who joined the company as maintenance director in 1983.
Peninsula Truck Lines was founded in 1951 by the Vander Pol family, which had been involved in trucking in the Pacific Northwest since the 1930s. Stan Vander Pol is president. The carrier has 15 service centers in Washington, Idaho and Oregon.
In addition to Mountain Valley and Peninsula, the Reliance Network includes Averitt in the South, Lakeville Motor Express in the Midwest and Plains states, Pitt Ohio in the Midwest and mid-Atlantic states, Land Air Express in the Northeast, and Epic Express and Canadian Freightways in eastern and western Canada.
The carrier alliance helps the regional LTL companies compete with larger national truckers, offering shippers single-source coverage of North America through integrated networks and computer systems, with Averitt handling the Mexican market.
Established in 2008, “the Reliance Network was designed to be a better mousetrap to deal with the volatility we’ve seen in the economy,” Muessig said. “We’ve got to give customers compelling reasons to use us rather than a global service provider.”
Contact William B. Cassidy at email@example.com.