U.S. election uncertainty making ‘very difficult’ freight market worse, TFI CEO says

MONTREAL - The head of Canada’s biggest trucking firm says the upcoming U.S. election is straining an already weak market for freight.

Uncertainty over the outcome of the political contest this fall means some customers are holding off on shipments until the result becomes clear, Alain Bédard, chairman and CEO of TFI International Inc., said on Friday.

On a conference call, Bédard gave the example of a green energy company spun off from General Electric, claiming GE Vernova’s wind turbine business could suffer depending on who wins after ballots are cast on Nov. 5.

“If it’s candidate one, he’s against windmills, so that business is going to fall. If you take the No. 2 guy, well he likes windmills, he’s more green. So that’s why we have these kinds of customers just sitting on the fence not knowing where the ball is going to drop — left or right,” Bédard said.

“We still anticipate this freight recession will not change probably before ‘25. We have an election year in the U.S. A lot of our customers are just waiting to see what’s going to happen.”

GE Vernova did not immediately respond to a request for comment.

A tough trucking environment in general has also hurt transport companies, the chief executive said, resulting in a seven per cent year-over-year drop in adjusted earnings per share in TFI’s latest quarter.

“Why is that? Because the truckload in Q1 was just a disaster,” he said. “It’s a very, very difficult market right now.”

Bédard was referring to the “truckload” segment of the business that carries full loads to a client, as opposed to “less-than-truckload” deliveries that make multiple drops of cargo for different clients on a single run.

Employment in trucking and logistics fell by about 38,000 jobs between 2021 and the end of last year, according to industry non-profit Trucking HR Canada.

The Conference Board of Canada has said household debt will hamper consumer spending this year, as Canadians’ penchant for online purchases continues to taper off from pandemic highs, leaving shippers in the lurch.

Bédard added that rampant undercutting of labour laws by some trucking outfits has harmed his company to the point where he is mulling a sale of one segment of TFI.

Asked by an analyst whether he would dispose of its Canadian truckload division, Bédard replied: “We’re asking ourselves that question.”

He added that he believes provincial and federal leaders will crack down on scofflaws, but noted that the problem has persisted despite years of warning calls from the industry.