Universal Logistics Holdings Profile
Universal Logistics Holdings, Inc. provides a variety of customized transportation and logistics solutions throughout the United States, and in Mexico, Canada, and Colombia. The company’s operating subsidiaries provide customers a broad array of services across their entire supply chain, including truckload, brokerage, intermodal, dedicated and value-added services.
The company’s operating subsidiaries provide a comprehensive suite of transportation and logistics solutions that allow its customers to reduce costs and manage their global supply chains more efficiently. The company markets and delivers its services in several ways:
Through a direct sales and marketing network focused on selling the company’s portfolio of services to large customers in specific industry sectors;
Through company-managed facilities and full-service freight forwarding and customs house brokerage offices; and
Through a network of agents who solicit freight business directly from shippers.
As of December 31, 2022, the company operated 51 company-managed terminal locations and serviced 63 value-added programs at locations throughout the United States and in Mexico, Canada and Colombia, and it had an agent network totaling approximately 240 agents.
Operations
The company broadly groups its revenues into the following service categories: truckload, brokerage, intermodal, dedicated, and value-added services.
Truckload: The company’s truckload services include dry van, flatbed, heavy-haul and refrigerated operations. The company transports a wide variety of general commodities, including automotive parts, machinery, building materials, paper, food, consumer goods, furniture, steel and other metals on behalf of customers in various industries.
Brokerage: The company provides customers freight brokerage services by utilizing third-party transportation providers to transport goods. Brokerage services also include full service domestic and international freight forwarding, and customs brokerage.
Intermodal: Intermodal operations include steamship-truck, rail-truck, and support services. The company’s intermodal support services are primarily short-to-medium distance delivery of both international and domestic containers between the railhead or port and the customer.
Dedicated: The company’s dedicated services are primarily provided in support of automotive customers using van equipment. The company’s dedicated services are primarily short run or round-trip moves within a defined geographic area provided through a network of union and non-union employee drivers, owner-operators, and contract drivers.
Value-Added: The company’s value-added services, which are typically dedicated to individual customer requirements, include material handling, consolidation, sequencing, sub-assembly, cross-dock services, kitting, repacking, warehousing and returnable container management. The company’s facilities and services are often directly integrated into the production processes of its customers and represent a critical piece of their supply chains.
Segments
The company operates through four segments: Contract Logistics, Intermodal, Trucking, and Company-Managed Brokerage.
Operations aggregated in the company’s contract logistics segment deliver value-added and/or dedicated transportation services to support in-bound logistics to original equipment manufacturers (OEMs) and major retailers on a contractual basis, generally pursuant to terms of one year or longer. The company’s intermodal segment is associated with local and regional drayage moves predominately coordinated by company-managed terminals using a mix of owner-operators, company equipment and third-party capacity providers (broker carriers). Operations aggregated in the company’s trucking segment are associated with individual freight shipments coordinated primarily by its agents using a mix of owner-operators, company equipment and broker carriers. The company-managed brokerage segment provides for the pick-up and delivery of individual freight shipments using broker carriers, coordinated by its company-managed operations.
Business and Growth Strategy
The key elements of the company’s strategy are to make strategic acquisitions; continue to capitalize on strong industry fundamentals and outsourcing trends; target further penetration of key customers in the North American automotive industry; continue to expand penetration in other vertical markets; and expand its network of agents and owner-operators.
Customers
Revenue is generated from customers throughout the United States, and in Mexico, Canada and Colombia. The company’s customers are largely concentrated in the automotive, retail and consumer goods, steel and other metals, energy and manufacturing industries.
A significant percentage of the company’s revenues are derived from the domestic auto industry. During 2022, General Motors accounted for approximately 16% of the company’s total operating revenues. Sales to the company’s top 10 customers, including General Motors, totaled 42% in 2022.
Government Regulation
The company’s operations are regulated and licensed by various U.S. federal and state agencies, as well as comparable agencies in Mexico, Canada, and Colombia. Interstate motor carrier operations are subject to the broad regulatory powers, to include drug and alcohol testing, safety and insurance requirements, prescribed by the Federal Motor Carrier Safety Administration (FMCSA), which is an agency of the U.S. Department of Transportation (DOT). Matters, such as weight and equipment dimensions also are subject to United States federal and state regulation. The company operates in the United States under operating authority granted by the DOT. The company’s drivers and owner-operators must have a commercial driver’s license and comply with safety and fitness regulations promulgated by the FMCSA, including those relating to drug and alcohol testing.
The company’s international operations, which include not only facilities in Mexico, Canada and Colombia but also transportation shipments managed by its specialized service operations, are impacted by a wide variety of U.S. government regulations and applicable international treaties. These include regulations of the U.S. Department of State, U.S. Department of Commerce, and the U.S. Department of Treasury. Regulations also cover specific commodities, destinations and end-users. Part of the company’s specialized services operations is engaged in the arrangement of imported and exported freight. As such, the company is subject to the regulations of the U.S. Customs and Border Protection, which include significant notice and registration requirements. In various Canadian provinces, the company operates transportation services under authority granted by the Ministries of Transportation and Communications. Transportation-related regulations are greatly affected by U.S. national security legislation and related regulations.
Seasonality
Generally, demand for the company’s value-added services delivered to existing customers increases during the second calendar quarter of each year as a result of the automotive industry’s spring selling season. Conversely, such demand generally decreases during the third quarter of each year due to the impact of scheduled OEM customer plant shutdowns in July for vacations and changeovers in production lines for new model years (year ended December 31, 2022).
The company’s value-added services business is also impacted in the fourth quarter by plant shutdowns during the December holiday period. The company’s transportation services business is generally impacted by decreased activity during the post-holiday winter season and, in certain states, during hurricane season.
History
The company was founded in 1932. It was incorporated in Michigan in 2001. The company was formerly known as Universal Truckload Services, Inc. and changed its name to Universal Logistics Holdings, Inc. in 2016.
