Old Dominion Freight Line Profile
Old Dominion Freight Line, Inc. operates as a North American less-than-truckload (‘LTL’) motor carrier.
The company provides regional, inter-regional and national LTL services through a single integrated, union-free organization. The company’s service offerings, which include expedited transportation, are provided through an expansive network of service centers located throughout the continental United States. Through strategic alliances, the company also provides LTL services throughout North America. In addition to the company’s core LTL services, the company offers a range of value-added services including container drayage, truckload brokerage and supply chain consulting. More than 98% of the company’s revenue has historically been derived from transporting LTL shipments for the company’s customers, whose demand for the company’s services is generally tied to industrial production and the overall health of the U.S. domestic economy.
The company’s infrastructure allows the company to provide service through each of its regions covering the continental United States.
The company’s integrated structure allows the company to offer its customers consistent, high-quality service from origin to destination. The company’s services are complemented by its technological capabilities, which improve the efficiency of the company’s operations while also empowering its customers to manage their individual shipping needs.
Service Center Operations
The company owns, operates, and leases various service center locations. The company’s service centers are responsible for the pickup and delivery (‘P&D’) of freight within their local service area. Each night, the company’s service centers load outbound freight for transport to the company’s other service centers for delivery. All inbound freight received by the service center in the evening or during the night is generally scheduled for local delivery the next business day, unless a customer requests a different delivery schedule. The company’s network includes major breakbulk facilities, as well as various other service centers that are used for additional limited breakbulk activity in order to serve the company’s next-day markets. The company’s service centers are strategically located throughout the country so that the company can provide the highest quality service and minimize freight rehandling costs.
Although the company has established primary responsibility for customer service at the local service center level, the company’s customers may access information and initiate transactions through the company’s centralized customer service department located at the company’s corporate office or through other digital channels. The company’s systems allow the company to offer its customers access to information, such as freight tracking, shipping documents, rate quotes, rate databases and account activity. The company’s integrated systems and customer service department provide its customers with a single point of contact to access information across all areas of its operations and for each of the company’s service offerings.
Linehaul Transportation
Linehaul dispatchers control the movement of freight between service centers through integrated freight movement systems. The company also utilizes load-planning software to optimize efficiencies in the company’s linehaul operations. The company monitors freight movements, transit times, load factors and many other productivity measurements to help ensure that the company maintains its high levels of service and efficiency.
The company utilizes scheduled routes and additional linehaul dispatches as necessary to meet the company’s published transit times. In addition, the company gains efficiency through the use of twin 28-foot trailers in the company’s linehaul operations. The use of twin 28-foot trailers permits the company to transport freight directly from its point of origin to destination with minimal unloading and reloading, which also reduces the company’s exposure to potential cargo loss and damage expenses. The company utilizes long-combination vehicles, such as triple 28-foot trailers and combinations of 48-foot and 28-foot trailers, in states where permitted. Twin trailers and long-combination vehicles permit more freight to be transported behind a tractor than could otherwise be transported by one trailer.
Tractors, Trailers and Maintenance
The company owns various tractors. The company generally uses new tractors in linehaul operations for approximately three to five years and then transfer those tractors to P&D operations for the remainder of their useful lives. In many of the company’s service centers, tractors perform P&D functions during the day and linehaul functions at night to maximize tractor utilization.
The company develops certain specifications for tractors and trailers and then negotiate the production and purchase of this equipment with several manufacturers. These purchases are planned well in advance of anticipated delivery dates in order to accommodate manufacturers’ production schedules. The company may periodically utilize third-party transportation providers in its linehaul network to supplement the company’s equipment or maintain older equipment that would have otherwise been replaced based on the company’s normal equipment cycle, in order to support its equipment needs.
The company operates various fleet maintenance centers at strategic service center locations throughout the company’s network. These fleet maintenance centers are equipped to perform routine and preventive maintenance and repairs on the company’s equipment.
The company adheres to established maintenance policies and procedures to help ensure the company’s fleet is properly maintained. Tractors are routed to appropriate maintenance facilities or authorized repair vendors generally at designated mileage intervals or every 90 days, whichever occurs first. Trailers are also generally scheduled for preventive maintenance every 90 days.
Customers
Revenue is generated primarily from customers throughout the United States and North America. In 2023, the company’s largest customer accounted for approximately 5.2% of its revenue and the company’s largest 5, 10 and 20 customers accounted for 15.0%, 21.6% and 30.6% of the company’s revenue, respectively.
Seasonality
The company’s revenue and operating margins in the first and fourth quarters (year ended December 2023) are typically lower than those during the second and third quarters due to reduced shipments during the winter months.
Governmental Regulation
The company is regulated by the DOT and by various state and federal agencies.
In addition, the company is subject to compliance with cargo-security and transportation regulations issued by the Transportation Security Administration (‘TSA’) and Customs and Border Protection (‘CBP’) within the U.S. Department of Homeland Security.
The company is registered as a motor carrier with the Commercial Driver’s License Drug and Alcohol Clearinghouse, which requires the company to check for drug and alcohol violations of current drivers at least annually and prospective employees prior to hiring.
History
Old Dominion Freight Line, Inc. was founded in 1934. The company was incorporated in Virginia in 1950.
