In the first seven months of this year, we have witnessed two of the largest acquisitions in the LTL trucking sector in many years. In January we observed the acquisition of UPS’s LTL division by TFII, the large Canada-based transportation conglomerate. Last week the nation’s largest TL carrier, Knight-Swift Transportation (NYSE: KNX,) acquired AAA Cooper Transportation in a $1.35 billion deal. AAA Cooper runs a regional network of 70 facilities and 3,400 doors spanning from El Paso, Texas, to the Southern East Coast, along with multiple locations in the Midwest. Knight-Swift purchased a company with a fleet of 3,000 tractors and 7,000 trailers for less than 10x EBITDA.

At $43 billion in revenue, the US LTL sector is approximately one tenth the size of the truckload industry. For many years this was a highly competitive low margin business. What is driving these large M & A activities in the LTL sector by predominantly truckload carriers?

Continued Strength in Manufacturing

Manufacturing and industrial activity, which can account for up to 85% of LTL tonnage for some carriers, has been strong during the pandemic. The Manufacturing PMI (Purchasing Manager’s Index) was 60.7% in June. The overall US economy has expanded for eleven consecutive months.

Two weeks ago I posted a blog (https://www.dantranscon.com/index.php/blog/entry/leadership-lessons-from-the-habs-amazing-victory-over-the-maple-leafs) on the Habs amazing come from behind victory over the Toronto Maple Leafs. Montreal finished the regular season in 18th place. The team won only 24 of 56 games, the lowest seeded team to make it to the Stanley Cup Playoffs. This underachieving organization has now defeated three teams including one with one of the best records during the regular season. What can businesses learn from this remarkable success? Here are five lessons to be gleaned from this amazing underdog story.

1. Results Dictate whether an Organization has the Right Team in place

The Canadiens GM made some significant additions during last year’s off season. He added a top defenseman (Joel Edmonson), three top forwards (Josh Anderson, Tyler Toffoli, Corey Perry) and a high-quality goalie (Jake Allen) to back up Carey Price. The team started the year on fire and then had an uninspiring, mediocre season. A team that was constructed to make a deep run in the playoffs was on the verge of failing to qualify.

The GM then made more changes. He fired and replaced three coaches including the head coach. He went out and added another aging but quality forward (Eric Staal) and two more defensemen (Jon Merrill, Erik Gustafson, a power play specialist). Management also made some personnel changes for the Leafs playoff series. They benched the young centre, Jesperi Kotkaniemi, and made limited use of the newly recruited defensemen. The Habs fell behind 3 games to one against the Leafs.

I was born and raised in Montreal, Quebec. From a very young age, I remember how hockey was such a big part of the life of people in Quebec. Saturday night was Hockey Night in Canada and I would be glued to our grainy black and white TV to watch the hometown Montreal Canadiens play one of the original six NHL teams.

Even though I lost my dad at a young age (car accident), my mom made sure that I had a pair of skates, a hockey stick and shin pads. I would go to the local rink to play hockey after school with boys in the neighbourhood. I remember my mom taking me to the Montreal Forum to see “Rocket” Richard and some of the other stars of that era. The love of hockey and the Habs never left me, even though I have lived in Toronto since 1976.

The game and the team have changed significantly over the years. Back in the 60s and 70s, the team was known for its home grown, French Canadian stars - - - Jean Beliveau, Boom Boom Geoffrion, Jacques Plante, Patrick Roy, Jacques Lemaire and of course, the Flower, Guy Lafleur. The team was admired for its high-speed offense and for its scoring stars. Even in the late 60s, the Montreal Canadiens had a junior team in Montreal, the Montreal Junior Canadiens. The Habs could select the top 2 players from this team every year. This changed in the early 70s and it allowed the Buffalo Sabres to draft the great Gilbert Perrault, who would have been another Habs star of that era.

When you fast forward to today, the nature of the team has changed drastically. While the Habs have a French-Canadian general manager and coach, the team had only French-Canadian player on their roster for the series with the Toronto Maple Leafs, Philip Danault. Their other French Canadian player, Jonathan Drouin, was on a leave of absence.

I am a resident of Toronto, Ontario, Canada. I live in a city and province where Covid-19 is just about out of control. It did not have to be this way. The warning signs have been there for months. But the premier of this province just did not get it and still does not get it. The Covid-19 pandemic has exposed a core set of leadership skills that are determinants of how successful a politician is in managing this crisis. Premier Ford has not demonstrated that he has these key leadership attributes.

A Belief in Science

The science has helped us understand the key elements of this highly transmissible virus. The Ontario’s Covid-19 Scientific Table is composed of several very knowledgeable medical experts. They advised the politicians that the virus is spread between individuals who are in enclosed spaces and are close together. The scientists have told us for months that if we stay home, wear masks, and remain socially distant, we can greatly reduce the spread.

In Ontario, we are in the third wave of the virus. The number of new cases is rising on almost a daily basis. But Premier Ford has chosen to close parks, golf and tennis clubs but keep factories, warehouses, and places of worship open. Is there a need to manufacture ladies’ purses during a pandemic? Why place people in congregated indoor settings which increase the risk of catching the virus?

Fifty-one days after taking office, President Biden signed into law the $1.9 trillion American Rescue Relief Bill, one of the most important pieces of legislation in the past 50 years. The bill is significant in many ways.

It will put money directly into the hands of lower- and middle-income Americans, those most in need of support. The bill directs $1,400 payouts to millions of Americans and continues unemployment checks for millions more as the country pulls itself out of the economic devastation of a pandemic that has killed more than 530,000 of its citizens. As itemized by Eric Levitz in New York magazine, the bill will have a broad range of impacts.

• A family of four with one working parent and one unemployed one will have $12,460 more in government benefits to help them make ends meet.

• The poorest single mothers in America will receive at least $3,000 more per child in government support, along with $1,400 for themselves and additional funds for nutritional assistance and rental aid.