William B. Cassidy | Jun 30, 2010 3:33PM EDT
Averitt Express is expanding into the flatbed trucking market, fielding a fleet of 50 flatbed trailers and ordering 50 more, the company said Wednesday.
Flatbed is a "logical line extension" for a carrier offering less-than-truckload and truckload service, said Phil Pierce, executive vice president of sales and marketing.
Averitt is moving into flatbed less than two months after partnering with five U.S. railroads to launch a nationwide intermodal service.
Both ventures represent steps in its transformation from a Southeastern less-than-truckload carrier to an international transportation and logistics company
Averitt started its flatbed service a few months ago with 12 trailers, Pierce said. It started in Birmingham, Ala.; Atlanta; Cincinnati; Louisville, Ky.; and Nashville, Tenn. Pierce said strong flatbed demand in several key markets is propelling expansion.
"Customer feedback indicated a demand for flatbed services in several areas across our network," said Pierce. "We're planning for even more growth."
The company said it is hiring regional flatbed drivers in several locations.
Flatbed demand, and rates, spiked this spring as demand overshot diminished capacity. Several flatbed haulers went belly up last year, including Arrow Trucking.
Analysts, however, see limits to robust flatbed demand.
Morgan Stanley's flatbed index was down almost 40 percent June 25 from May 7, "in line with recent disappointing housing figures," the research firm said.
The flatbed index was still up 400 percent from the depths it reached a year ago, however, and 83 percent higher than Morgan Stanley's 13-year average.
Longbow Research's Flatbed Barometer decreased 1.8 percent over the week of June 20 and is off 18.2 percent from its peak in the week of May 2.
"We believe the sequential declines we have seen since the peak are driven by slightly weaker drywall demand following a pre-buy ahead of a price increase in May," said Longbow Research transportation analyst Lee A. Klaskow.
"Many flatbed carriers we have spoken with have noted that demand is still robust but is off its highs," Klaskow said.
Longbow sees flatbed capacity tightening in New England and parts of the West.
-- Contact William B. Cassidy at wcassidy@joc.com.
