Dive Brief:
- Landstar System’s owner-operator headcount dropped 10% year-over-year in Q4, and the decrease is forecast to continue through Q1, the company reported Wednesday.
- The number of drivers leased to the company fell by 184 trucks from Q3 to a total of 8,082, President and CEO Frank Lonegro said on an earnings call. For comparison, more than 11,000 drove for the company during the COVID-19 pandemic freight boom in 2021.
- “We would expect BCO count to continue to decline in the first quarter, given the challenging operating environment faced by many truck owner-operators and the typical seasonality in truck count experienced from the fourth quarter to the first quarter,” Lonegro said.
Landstar owner-operator count dips for 11th straight quarter
Owner-operator workforce during each quarter since Q2 2021.
Dive Insight:
As owner-operators continue to face soaring costs of maintaining and operating equipment, Landstar’s fleet likely will shrink again in Q1, Lonegro said. But he had good news to share with analysts on the call.
“The cycle is moderating,” the CEO said. “In other words, we are having, on a net basis, fewer declines in the overall fleet.
“I would say that if you looked at the second half of 2024, we’re sort of in the best shape from a lessening of declines since the first half of 2022,” he added. “So we’re seeing the end of the cycle on that one.”
Landstar is adding hundreds of owner-operators each quarter, but new leases aren’t keeping pace with exits, Lonegro said.
“We obviously need that number to continue to go higher,” he said. “Rate helps there, but we’re still experiencing turnover at a higher-than-typical level, and we would expect that number to come down.”
Matt Miller, who was promoted to VP and chief safety and operations officer in December, said the company is making progress on its efforts to better retain owner-operators.
“We’re digging into how we’re marketing,” he said. “We’re digging into how we’re qualifying. We’re digging into how we’re going through orientation and then the support that we provide and trying to make it as easy as possible to do business with us.”
