Knight-Swift Transportation Holdings Profile
Knight-Swift Transportation Holdings Inc. (Knight-Swift) operates as a freight transportation company.
The company provides multiple full truckload, LTL, intermodal, and other complementary services. Knight-Swift uses a nationwide network of business units and terminals in the U.S. and Mexico to serve customers throughout North America. In addition to operating one of the country's largest truckload fleets, Knight-Swift contracts with third-party equipment providers to provide a broad range of transportation services to the company's customers while creating quality driving jobs for its driving associates and successful business opportunities for independent contractors.
During 2023, the company covered 1.6 billion loaded miles for shippers throughout North America. During 2023, the Truckload segment operated an average of 20,948 tractors (consists of 18,821 company tractors and 2,127 independent contractor tractors) and 87,865 trailers. The company's LTL segment operated an average of 3,201 tractors and 8,482 trailers. Additionally, the Intermodal segment operated an average of 639 tractors and 12,730 intermodal containers.
The company's multiple service offerings, capabilities, and transportation modes enable it to transport, or arrange transportation for, general commodities for its diversified customer base throughout the U.S. and Mexico using its equipment, information technology, and qualified driving associates and non-driver employees. The company provides its customers with a wide range of full truckload, LTL, logistics, and intermodal services and continuing to invest considerable resources toward developing a range of solutions for its customers across multiple service offerings and transportation modes.
Segments
The company operates through four segments: Truckload, LTL, Logistics and Intermodal.
Truckload
The Truckload segment consists of three full truckload operating segments that provide similar transportation services to the company's customers utilizing similar transportation equipment over both irregular (one-way movement) and/or dedicated routes. The Truckload reportable segment consists of irregular route and dedicated, refrigerated, expedited, flatbed, and cross-border operations.
LTL
LTL segment, established through the ACT and MME acquisitions, consists of one operating segment and provides its customers with regional LTL transportation services through a network of approximately 120 service centers in the company's geographical footprint. The company's LTL service also includes national coverage to customers by utilizing partner carriers for areas outside of the company's direct network.
Logistics
The Logistics reportable segment consists of one logistics operating segment that provides transportation services to the company's customers and primarily consists of brokerage and other freight management services utilizing third-party transportation providers and their equipment.
Intermodal
The Intermodal segment consists of one intermodal operating segment that provides transportation services to the company's customers. These transportation services include arranging the movement of customers' freight through third-party intermodal rail services on the company's trailing equipment (containers and trailers on flat cars), as well as drayage services to transport loads between the railheads and customer locations.
All Other segments
The All Other Segments include four non-reportable operating segments that consist of support services provided to the company's customers and independent contractors (including repair and maintenance shop services, equipment leasing, warranty services, and insurance), trailer parts manufacturing, warehousing, and certain driving academy activities, as well as certain corporate expenses.
Growth Strategies
The key elements of the company's strategy include strengthening its customer relationships; improving asset productivity; acquiring and growing opportunistically; expanding existing truckload terminals and LTL door count; and diversifying its service offerings.
Customers and Marketing
Marketing
The company's marketing mission is to be a strategic, efficient transportation capacity partner for its customers by providing transportation and logistics solutions customizable to the unique needs of its customers. The company delivers these capacity solutions through its network of owned assets, independent contractors, third-party capacity providers, and rail providers. The diverse and premium services the company offers provide a comprehensive approach to supply chain solutions for its customers. As of December 31, 2023, the company had a sales staff of approximately 200 individuals across the U.S. and Mexico, who work closely with management to establish and expand accounts.
Customers
The company's customers are typically large corporations in the retail (including discount and online retail), food and beverage, consumer products, paper products, transportation and logistics, housing and building, automotive, and manufacturing industries. Many of the company's customers have extensive operations, geographically distributed locations, and diverse shipping needs.
Seasonality
In the full truckload transportation industry, results of operations generally follow a seasonal pattern. Freight volumes in the first quarter (year ended December 31, 2023) are typically lower due to less consumer demand, customers reducing shipments following the holiday season, and inclement weather. At the same time, operating expenses generally increase, and tractor productivity of the company's Truckload fleet, independent contractors, and third-party carriers decreases during the winter months due to decreased fuel efficiency, increased cold-weather-related equipment maintenance and repairs, and increased insurance claims and costs attributed to higher accident frequency from harsh weather. These factors typically lead to lower operating profitability, as compared to other parts of the year. Additionally, beginning in the latter half of the third quarter and continuing into the fourth quarter, the company typically experiences surges pertaining to holiday shopping trends toward delivery of gifts purchased over the Internet as well as the length of the holiday season (consumer shopping days between Thanksgiving and Christmas). However, as the company continues to diversify its business through expansion into the LTL industry, warehousing, and other activities, seasonal volatility is becoming more tempered.
Environmental Regulation
The company is a Charter Partner in the United States Environmental Protection Agency's SmartWay Transport Partnership, a voluntary program promoting energy efficiency and air quality.
The company's operations are regulated and licensed by various federal, state, and local government agencies in North America, including the United States Department of Transportation (DOT), the Federal Motor Carrier Safety Administration (FMCSA), and the U.S. Department of Homeland Security, among others.
History
The company was founded in 1989. It was incorporated in 1989. The company was formerly known as Knight Transportation, Inc. and changed its name to Knight-Swift Transportation Holdings Inc. in 2017.
