Covenant Transport has distinguished itself largely through its team driving emphasis, and its leadership sees good potential to capitalize further on that asset.
The company has about 900 teams and 375 solo drivers. About 90 of the trucks are owner-operated. For hazmat-certified owner-operators, the team opportunities include 100 percent no-touch freight, $1.03 per mile, a safety bonus, a $1,000 monthly bonus to each team that runs 15,000 miles, and other benefits.
The team advantage has been most evident recently with e-commerce freight and organic food, said senior executives I met with during a visit to the Chattanooga, Tenn., headquarters.
Though the company has long valued teams, its current focus and market position has evolved greatly in the last two decades. CTG grew too quickly between 1997 and 2000, from 1,600 trucks to 4,000, said Joey Hogan, president of holding company Covenant Transportation Group. Then the recession hit, and the company struggled until 2010.
Prior to 2011, when the company developed a comprehensive strategic plan, its team operation was used largely as a “just-in-time inventory system around manufactured goods,” where the value added wasn’t all that critical, said Richard Cribbs, CTG executive vice president and chief financial officer.
“We had to price accordingly,” he said. “What we should’ve been competing with was air freight.”
Now Covenant is hauling lots of freight for Amazon and less-than-truckload carriers like FedEx and UPS. With the LTL contracts, Covenant often transports consolidated shipments long-haul, and the LTL receiver breaks down the shipment for distribution. Team operations can meet deadlines acceptable to these customers, but solo drivers can’t, he said.
