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April 1 2019

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April 1 2019 | The Journal of Commerce 29 www.joc.com Surface Transportation Even shippers who view a logistics provider as nothing more than a broker can benefit in a buyer's market, but Tucker believes those who recognize 3PLs as supply chain consultants will save more in the long run. JOC email: ari.ashe@ihsmarkit.com twitter: @arijashe at a break-even or slightly profitable point by the end of the year. "We are taking a very long-term view here," Stoelting said. The new management team, led by Roadrunner Freight President Frank Hurst, is "really building (the LTL carrier) from the ground up terminal by terminal, lane by lane, customer by customer," he said. The company will have the financial run- way to do that thanks to the completion of its $450 million rights offering and recapi- talization plan in February, Stoelting said. Elliott, run by billionaire Paul Singer, is an activist investor with approximately $34 billion in assets under management and a history of investing in distressed companies such as Roadrunner and turning them around, often by forcing significant reorganization. That effort is well under way at Roadrunner, which has streamlined and sold subsidiaries. JOC email: bill.cassidy@ihsmarkit.com twitter: @willbcassidy with your top 10 to 15 asset-based carriers, everyone can have a piece of the pie and work more collaborative- ly," said Mark Ford, chief operating officer at BlueGrace Logistics. No one is forcing a shipper to collaborate or look at their 3PL as more than a broker. Perhaps it's on the 3PL to convince clients they are more than a service provider. loss in 2017. Higher truckload rates that benefited TES actually hurt the LTL opera- tion, which relies on owner-operators, and thus faced higher purchased transporta- tion costs, particularly in the first half of 2018, as spot rates soared. Roadrunner's target is to see the LTL unit the supply. When demand is low and supply is abundant, a shipper will push to reduce rates. It's almost an ingrained, innate response that is hard to turn off. "Last year, you didn't see too many carriers saying, 'I'm going to give up the rate increases I was dying to get for three years. I'm going to give them up as an act of collabora- tion and coming toward the middle,'" said Brian Reed, vice president of France-based global 3PL Geodis. "Two years before that, it was shippers saying, 'I'm going to squeeze every penny I can out of the carrier because of what I had to pay in 2014.'" Reed, a former transportation manager for Niagara Bottling, said his approach as a shipper was to view 3PLs as a way to access a different segment of the trucking market. He could access one slice of available capacity via contracts with large carriers, while 3PLs gave him access to smaller carriers. Given the highly fragmented nature of the US trucking market, each should have a place in a shipper's supply chain, according to Reed. "It's hard to handle relationships with tens of thousands of carriers, so if you let the broker handle that portion, and you have a relationship expedited revenue at subsidiary Active On-Demand, though over-the-road truck- load and intermodal services increased. Ascent, the company's third-party logistics division, was the star of the quar- ter, increasing revenue 12.6 percent, with international freight forwarding driving growth thanks to higher rates and vol- umes, including the acceleration of some shipments ahead of US tariffs that were expected to hit at the start of 2019. Those tariffs have been delayed. For the full year, Roadrunner's truck- load and logistics businesses were profitable, with truckload revenue up 13.2 percent and Ascent's business growing 14 percent, excluding the sale of logistics subsidiary Unitrans in 2017. The TES unit reported higher rates across all units and strong volume in air and expedited ground services during a banner year for trucking. Roadrunner Freight, the LTL unit, lost $27 million on $452.3 million in revenue in 2018, compared with a $26.6 million net Shutterstock.com Shutterstock.com Down -12.6% from March 2018 $1.50 $1.60 $1.70 $1.80 $1.90 $2.00 $2.10 $2.20 May.05 (Week 18) May.19 (Week 20) Jun.02 (Week 22) Jun.16 (Week 24) Jun.30 (Week 26) Jul.14 (Week 28) Jul.28 (Week 30) Aug.11 (Week 32) Aug.25 (Week 34) Sep.08 (Week 36) Sep.22 (Week 38) Oct.06 (Week 40) Oct.20 (Week 42) Nov.03 (Week 44) Nov.17 (Week 46) Dec.01 (Week 48) Dec.15 (Week 50) Dec.29 (Week 52) Jan.12 (Week 2) Jan.26 (Week 4) Feb.09 (Week 6) Feb.23 (Week 8) Mar.09 (Week 10) DAT Weekly National D ry Van Spot Rate Average US truckload spot rates on the decline Source: DAT Solutions © 2019 IHS Markit Weekly spot truckload rates per mile excluding fuel surcharges

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