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Estes Cuts Ties with Long Term Partner to Provide Direct LTL Service to Canada

 

b2ap3_thumbnail_Estes---Saia_20170407-192111_1.jpgThe big news on the LTL scene in Canada over the past few weeks has been the severing of ties between Estes Express, the number 14 ranked carrier (on the Transport Topics list) in the United States and TST Overland Express, a large Ontario-based LTL carrier that is one of the major divisions of TFI International (formerly known as TransForce), Canada’s giant trucking conglomerate. This is a partnership that has endured for many years.

Estes Express Lines will be teaming up with two regional Canadian less-than-truckload carriers to offer LTL freight services to Canada under an Estes freight bill. Estes will be working with Speedy Transport of Brampton, Ontario, and Pacific Coast Express Ltd. (a division of the Landtran Group) of Surrey, British Columbia, to offer Estes Canada service. The new alliance will start May 22, according to Estes.

The company stated that U.S. shippers will work with only one carrier, Estes, from pickup to delivery, and all freight will be delivered on an Estes delivery receipt. In effect, Speedy Transport and Pacific Coast Express will become agents of Estes. When asked what drove the need for Estes to convert its Canadian service to a direct model, Ed Alderman, Vice President, International and Offshore Sales for Estes, said Estes wants customers to have the same quality Estes customer service experience from shipment to delivery as they have come to depend on domestically.

As reported in Transport Topics, Estes said it is forming dedicated account teams in Canada to provide the same service level that U.S. customers receive. Freight will move across the border in Estes pup trailers equipped with captive beams and Estes’ proprietary Webb walls. This direct method of cross-border shipping is meant to reduce handling of freight and decrease risk of damage, the company said.

One must remember that Canada has a large land mass with limited population and freight density. There are only a few Canadian carriers that have extensive coverage of the country. Some markets such as the Atlantic provinces, eastern and northern Quebec and northern Ontario, have very few LTL providers. Most regional LTL carriers in Canada, including Estes’ new agents, cover specific areas within the country. Speedy acknowledges in their website that have they established strategic partnerships with Canada’s best carriers to serve the balance of Canada. As a result, Estes, like most American carriers, will be required to use specific interline carriers or other agent partners to serve the remaining markets on a “direct” basis.

TST Overland Express responded quickly to this change by announcing that it would be partnering with Saia LT Freight. Saia LT Freight will service TST Overland's LTL freight entering/leaving the U.S. and TST Overland will service Saia's LTL freight entering/leaving Canada. The partnership will be effective May 22, 2017, the same date that the Estes move occurs. Cross-border freight will be serviced as usual during the transition period.

It should be noted that these types of changes are a regular occurrence. A few years ago, Speedy Transport served as the Canadian agent for Old Dominion Freight Lines. Holland Motor Express, the YRC regional carrier has had a 20-year relationship with Speedy. R & L Carriers was formerly affiliated with the Kingsway division of TFI.

Old Dominion now works with another Canadian giant, Manitoulin Transport. R & L Carriers now partners with the Day & Ross Group. Kingsway Transport and Canadian Freightways, another TFI division, are part of the Reliance Network that includes Averitt Express, Pitt-Ohio, LME and Peninsula Express.

ABF, FedEx Freight, YRC Freight, XPO Logistics (formerly Con-way) and UPS Freight offer direct cross-border LTL service using their terminal networks. Years ago, YRC purchased Reimer Express that allows them to supply domestic LTL service within Canada. Most US carriers do not provide domestic Canada LTL services.

Other carriers use different approaches to serve the cross-border market. Consolidated FastFrate exchanges cross-border freight with AAA Copper over Chicago. Southeastern Freight Lines offers direct service to Toronto only. Other LTL carriers in Canada have partnerships with other regional American carriers. As an example, Midland Express has regional partnerships with A. Duie Pyle, Roadrunner/Dawes and Wilson Trucking Corporation.

History has shown that, over time, carriers often become disillusioned with the sales and/or service performance of their partners and decide to switch. For some carriers, such as Estes, a decision is made to obtain control of the end-to-end process and provide “direct” service through their own people and facilities or through an agent or agents. The only constant on Canada-US LTL shipping is change.

 

If you need helping in finding partners on either side of the border, please contact me (dan@dantranscon.com). To stay up to date on Best Practices in Freight Management, follow me on Twitter @DanGoodwill, join the Freight Management Best Practices group on LinkedIn and subscribe to Dan’s Transportation Newspaper (http://paper.li/DanGoodwill/1342211466).

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Guest Thursday, 28 March 2024

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