At a time when the trucking industry is facing massive driver shortages, sweeping technological disruption, and mounting pressure to improve operational efficiencies, several companies have been taking the mergers and acquisitions route to strengthen their competitive positioning. In keeping with this, 2021 closed out with the announcement that a global transportation services provider, the Pennsylvania-based Penske Truck Leasing, would be acquiring the smaller, family-owned and operated, New York state-based transport company DeCarolis Truck Rental, Inc. The acquisition will bring DeCarolis Truck Rental into the fold of the Penske Transportation Solutions company, while building on its complementary strengths.
Penske Truck Leasing currently has around 355,000 vehicles. Its wide-ranging global services cover more than 1,300 destinations spanning North America, Europe, South America, Asia, and Australia. The company offers commercial and consumer truck rentals, full-service truck leasing, and used truck sales. In addition, it provides solutions in transport, warehouse, and supply chain management.
DeCarolis has had an almost eight-decade run as a family-owned company. Smaller in size and scope, it has about 2,350 vehicles covering around 10 locations. Similar to Penske, it offers truck leasing in addition to rentals, maintenance, and repair services.
Learn more about the future growth potential of vehicle leasing, emerging opportunities, and more in Global Vehicle Leasing Outlook, 2021.
Importance of Acquisitions in Enabling Economies of Scale
Frost & Sullivan’s fleet and leasing program has highlighted mergers and acquisitions as a strategic response to the need for greater transparency and improved operational efficiencies in the commercial fleet industry. Reducing empty miles, enhancing technology applications, building on a robust freight market, and advancing service capabilities have been among the key motivations behind the hectic M&A activity in the trucking industry in recent times.
In addition, our research highlights the importance of acquisitions in enabling economies of scale. We also find that companies are increasingly looking for inorganic routes to grow since it helps in instant fleet expansion while preventing the need to invest in new trucks. As crucially, it allows them immediate access to that scarcest of commodities: trained drivers.
While Penske’s acquisition of DeCarolis might well have been the last of 2021, it will set the tone for 2022.
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