UPS acquires Freightex to accelerate expansion of UK and European truckload brokerage business

Jan 10, 2017: UPS has acquired UK based Freightex, asset-light provider of truckload, less-than-truckload, specialised and refrigerated over-the-road services. This will help UPS to establish its presence in the growing UK and European third-party logistics (3PL) over-the-road brokerage transportation market.

Also, it launches a new global and regional UPS growth platform from an established base of customers and carriers.

The transaction follows UPS’s acquisition of Coyote Logistics in August 2015. Coyote is a leading truckload brokerage provider in North America. Coyote and Freightex business models are complementary and UPS expects to share the best system technologies, business processes, as well as leverage customers and carriers across the two units.

Terms of the January 3, 2017 transaction were not disclosed.

“The UK and Europe are strategic 3PL freight brokerage growth markets for UPS and there is significant cross border opportunity,” said Alan Gershenhorn, chief commercial officer, UPS.

The European 3PL market was forecast to reach $174 billion by the end of 2016¹. The freight brokerage portion of the UK and total European 3PL market is growing at a faster rate than the total market and is expected to further expand as shippers and carriers further adopt the brokerage model². Brokered shipping services often provide greater efficiency brought about by higher fleet asset utilisation when compared to operating dedicated fleets.

More than one-half million road freight carriers currently operate in Europe, presenting significant opportunities to expand UPS’s existing carrier base to create more value for customers and carriers from the advantages of higher equipment and staff utilisation.

Shippers of all sizes and industries today rely on Freightex for the efficient movement and visibility of goods across the UK and Europe every day. Freightex also routinely handles freight from shippers who require temperature-controlled, specialized, and other types of customized equipment. The company has eight locations across the UK and Europe and uses an asset-light model to match customers’ outgoing freight shipments with available trucking capacity in its network of carriers.

By gaining access to UPS’s global network, Freightex customers will gain the benefits of scale, reach, and access to a broad integrated portfolio of shipping solutions for all their supply chain management and shipping needs. In turn, Freightex operations will provide UPS customers a turn-key UK and European solution where brokered freight movements provide the most competitive option.

“We will improve our efficiency through Coyote’s technology and use of the UPS network, while continuing to out-service the competition and provide results that customers count on us to deliver,” said Tim Phillips, Freightex’s chief executive officer.

Phillips will continue to lead the Freightex business, which will operate as a wholly-owned subsidiary of UPS.

“UPS has many existing customers who will benefit from UK and European transportation brokerage capabilities. We will provide added value, helping customers and carriers streamline operations and have simplified visibility through the same Coyote system that they use in North America,” Gershenhorn added.

“Freightex’s proven expertise and strong regional network, combined with Coyote’s technology, people, processes, and service reputation will present a best-in-class solution for customers.”