Heartland Express – Keeping on Trucking
There is more freight on the roads than ever before, and Heartland Express is getting it to where it needs to go.
Heartland Express was founded in 1978 and gone public in 1986. At the time it went public the firm had $20 million in revenue and a fleet of 125 trucks. From there Heartland Express has grown and spread, focussed on truckload and A-to-B-and-back and collect-to-freight business, doing the best it can by customers and drivers every day.
Throughout all those trips, Heartland Express differentiates itself through one crucial ingredient: Service.
“We do a lot of just-in-time freight, we do a lot of production line freight,” says Mike Gerdin, Heartland Express’s CEO. “We haul a lot for FedEx, DHL, and UPS. We haul freight that is very time sensitive, so our calling card has always been service and taking care of our customers.”
And it is a good thing too, as Heartland Express’s services have never been in more demand.
All the Freight You Can Haul
“For the last two years, we’ve had more freight to haul than we can think about hauling,” Gerdin says. “Everyone was afraid of running out of things during Covid so there was so much over-ordering by so many companies that we were jammed with freight, which is where the supply chain issues came in.”
For two years Heartland Express, and the industry as a whole, faced a huge influx of freight, and while it kept the company’s drivers busy and was good for business, the after-effects of that rush have left lingering issues on the supply chain. To start with, Heartland Express needs to keep its trucks on the road.
“Our current challenges are tuned towards trucks and trailers and getting components,” Gerdin says. “OEMs are struggling to manufacture enough trucks for the industry. All across the world trucks need different components and a lot of the companies building those components are out of workers or shut down for Covid. So now this is the supply chain issue that is hitting us in terms of getting enough trucks or parts to keep trucks running.”
Fortunately, Heartland Express has a very new fleet, something that has always been a hallmark of the business.
“We have fewer breakdowns than a lot of trucking companies out there running older equipment. We intend to keep that going, because I hear a lot of nightmare stories in the industry about when parts break down and you can’t find replacements,” Gerdin points out.
Maintaining a young fleet has also proven to be a vital boon at a time when sustainability is at the top of everybody’s agenda.
“Having a new fleet helps in staying up-to-date on sustainability and green items and initiatives,” Gerdin says. “We don’t build the trucks, we just drive them, but we have always had the newest technology that’s available in the industry. We have the cleanest engines that have ever been produced. We have always been on the front end of these sustainability issues and greenhouse gas issues as well. We have invested in that technology in the past, staying ahead of the latest benchmarks set by the EPA.”
Having fresh, high-quality vehicles also helps Heartland Express with one of the other biggest challenges facing the freight industry at the moment.
“Drivers want to be driving a good quality truck, and we’ve covered that. That is important for retention,” Gerdin tells us.
Keeping Talent Behind the Wheel
Recruiting drivers is a certainly hard nut to crack for everyone in the road freight business right now. As Gerdin says, “There is a lot of freight out there, and it all has to move, and people need to drive trucks to do that.”
But the industry needs more than people who can drive, the job demands a very specific set of qualities.
“It is not an easy job and the drivers we have to do a great job, but it’s not for everyone. It takes a special person to do that job and it is a challenge for our industry going forward because the freight keeps coming and has to move,” Gerdin says. “People need to eat and the only way to do it at this point is trucks.”
Heartland Express is nurturing its own new generation of drivers, with its own driving schools to take people without a CDL and turn them into certified truck drivers.
“We do the classes, the paperwork, road tests, everything needed to get a man or woman to have a CDL and be qualified to drive a truck,” Gerdin says. “That has helped to bring new blood into the industry. A lot of other companies are doing the same thing. A lot of drivers are reaching the end of their careers, so we need more new blood coming into the industry.”
And it is in a hurry to find that new blood, as Covid-19 and the lockdown have put the entire industry’s training programme back almost two years.
But it is not enough to simply train drivers, driving has to be seen as an appealing career path. Heartland Express’s young fleet of high-quality vehicles is only part of that.
“It also means having facilities they can rest at and terminals and facilities with showers and drivers lounge and nice amenities,” Gerdin says. “We are trying to make their lives comfortable for the job that they do every day.”
Alongside amenities, Heartland Express also allows its drivers the flexibility to fit their driving to their lifestyle.
“There are all different kinds of drivers in the industry,” Gerdin reflects. “Some want to be gone for a month and just work, some want to be home every single weekend, and some want to be home every single day. We have provided a lot of different avenues to accommodate drivers and the kind of driving they want to do.”
Rising to the Challenge
As well as growing and taking care of driving talent within the company, Heartland Express has also been expanding through other means, including its recent acquisition of Contract Freighters Inc.’s (CFI) truckload unit and its logistics unit in Mexico from TFI International for $525 million.
“CFI is a company we have admired for a long time. They do the same things we do,” Gerdin tells us. “They provide high service, great drivers. They are an irregular route truckload carrier just like we are. Our cultures and company goals match in a lot of different areas. We are thrilled to have them come aboard and truck with us.”
The deal will put Heartland Express in ownership of the eighth largest freight fleet in the USA. It is the kind of fleet that the industry needs right now.
“We’re in such a big industry, and there’s so much freight to be hauled,” says Gerdin. “We are just a small portion of this industry and supply chain, so being able to grow in the future is not a question. But being disciplined and growing in the right markets is very important. We have always considered ourselves a long-term investment, and our track record shows what we’ve done over the long-term.”