Less-than-truckload carrier Saia Inc. (NASDAQ: SAIA) announced Monday the addition of another terminal in the northeastern U.S. The Johns Creek, Georgia-based carrier’s newly opened facility near Wilmington, Delaware, marks its 20th addition to the region in the last four years.
In 2017, Saia embarked on an aggressive Northeast growth campaign, adding terminals from New Hampshire to Maryland. Those plans accelerated following the demise of New England Motor Freight, which had a large terminal footprint in the area.
“The new facility in Wilmington enhances our service across this geography as well as throughout our network,” said Jared Mull, VP of operations for the East. “Beyond this new terminal, we plan to open an additional four to six facilities throughout the course of this year, including our Northeast Atlanta terminal targeted for the fourth quarter.”
On the company’s fourth-quarter call, management announced a $275 million net capital expenditures budget for 2021, which includes investments in its fleet, infrastructure and terminals. Saia spent $219 million in capex in 2020, a year that many companies cut investments and preserved liquidity due to uncertainty around COVID-19.
The carrier added one terminal and replaced five others in 2020, increasing total door count by 4%. Saia plans to eclipse that mark this year.
The step up in spending includes the purchase of raw land, greenfield developments and terminal expansions. Saia is aiming to expand capacity, improve its freight mix and reduce turn times by adding facilities that are closer to its customers.
“Despite the challenges that 2020 presented, we are continuing to execute our plans to grow and provide quality, industry-leading service for our customers,” added Mull.
New investment continues to pour into the LTL market in efforts to meet incremental demand.
Old Dominion Freight Line (NASDAQ: ODFL) recently announced a hiring blitz for drivers and dockworkers following plans to expand its terminal network again this year. Yellow Corp. (NASDAQ: YELL) said it was adding 1,500 drivers and opening 12 driver academies in February. Last year, Forward Air (NASDAQ: FWRD) expanded its LTL offering to include a more traditional service outside of its legacy airport-to-airport terminals.
While LTL tonnage took a weather-related hit in February, analysts have become more bullish on the space in recent weeks as volumes have snapped back. Additionally, more of the industrial economy appears to be coming back online, historically a large contributor of LTL freight, and contractual price negotiations are yielding mid- to high-single-digit increases.
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