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Knight-Swift Transportation won't be making its hoped-for LTL acquisition before next year, its CEO said on an earnings call Wednesday.

The big picture: Valuations could be difficult to agree on as carriers work through the prolonged freight down-cycle, that's been made worse by tariffs. 

Catch up quick: Knight Swift, the largest U.S. truckload carrier, had hoped to provide LTL service in the Northeast this year, either through an acquisition or organic expansion. 

It had aimed to fill in its final regional gap to complete the buildout of its national LTL trucking network by 2026.

What they're saying: "This is a year of growing into what we have," CEO Adam Miller said during the call.  

Responding to a separate question about whether it might evaluate its truckload portfolio, Miller said, "We also don't want to make some decisions around businesses in the trough of troughs."

"This has been the most challenging cycle that we've seen, maybe ever, and so we want to see how some of these businesses navigate through that."

Context: LTL trucking — in which customers' palletized freight shares space on trailers — is more durable and stable than the more cyclical truckload market.

This dynamic is underpinning high deal valuations, Knight-Swift CFO Andrew Hess said at the SMC3 conference in Atlanta in January.

Knight-Swift's push into LTL has pressured national competitors FedEx Freight, Old Dominion Freight Line, XPO, Estes Express Lines, Saia, R+L Carriers, ABF Freight and TForce Freight, which aren't immune to the freight recession.

Between the lines: Acquisitions are "the only viable means of growth" amid tariff whiplash and the tough market, Murray Mullen, chair of Canada logistics giant the Mullen Group, said in a Q1 earnings report Wednesday.

The Mullen Group announced the acquisition of customs brokerage the Cole Group last week, and Mullen reports that its M&A deals last year accounted for its revenue growth in Q1.

Flashback: Knight-Swift entered the LTL market in 2021, acquiring Alabama-based AAA Cooper Transport for $1.35 billion and Midwest Motor Express for $150 million that year.

It took the trucking giant two years of negotiations to acquire Los Angeles-based Dependable Highway Express for an undisclosed sum last year. 

Zoom out: Another Knight-Swift LTL acquisition would be more consolidation in the sector, which was transformed by Yellow Corp.'s 2023 bankruptcy and asset sales.

Carriers are also watching an anticipated TFI International M&A deal and the looming spinoff of FedEx Freight.

Thought bubble: Several privately held LTL carriers in the Northeast likely make for attractive acquisition targets, though their appetite for deals is unclear.

Expect Knight-Swift to kick tires around companies like Pennsylvania-based Ward Transport & Logistics and New York-based RIST Transport.

A. Duie Pyle, another Pennsylvania-based regional carrier, has turned down offers from multiple national carriers in recent years. 

Knight-Swift doesn't expect a Northeast LTL trucking deal before 2026

Valuations could be difficult to agree on as carriers work through the prolonged freight down-cycle..

A red Swift truck pulling a white Swift trailer drives on Interstate 95 in Maryland on Oct. 21, 2022. (Photo by Beata Zawrzel/NurPhoto via Getty Images)

A Swift Transportation tractor-trailer drives on Interstate 95 in Maryland on Oct. 21, 2022. Photo: Beata Zawrzel/NurPhoto via Getty Images

Knight-Swift Transportation won&#x27;t be making its hoped-for LTL acquisition before next year, its CEO said on an earnings call Wednesday.The big picture: Valuations could be difficult to agree on as carriers work through the prolonged freight down-cycle, that&#x27;s been made worse by tariffs.

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Knight-Swift doesn't expect a Northeast LTL trucking deal before 2026

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