Site Search

Menu

Capabilities

Menu

Artificial Intelligence (AI)

Menu

Cybersecurity, Risk and Regulatory

Menu

Financial Markets & Real Estate

Loading Results

Transportation and logistics: US Deals 2025 outlook

T&L deals set to rebound amid growing confidence and strategic supply shifts

The global transportation and logistics (T&L) sector recorded a total deal value of $51.5 billion with 71 disclosed deals for the six-month period ending November 15, 2024, compared to $39.5 billion and 69 deals for the prior six-month period ending May 15, 2024. While deal volume remains stable, the increase in deal value may be indicative of improving investor confidence, driven by anticipated profitability improvements amid rising demand and supply adjustments.

Subsectors such as trucking and maritime freight have recently contended with prolonged lower freight rates. However, these rates are now rebounding due to escalating consumer demand and strategic supply rationalization. The trucking industry in particular has seen distressed assets absorbed through mergers and acquisitions (M&A), while the maritime sector has gained advantages from trade route disruptions in the Red Sea and port congestion, which have collectively absorbed excess supply.

Transportation and logistics deal value and volume, last eight quarters

Note: The primary M&A data source used in the 2025 outlook is S&P Capital IQ.

These trends are expected to heighten investor interest in T&L mergers and acquisitions, as enhanced profitability bolsters valuation justifications. Nevertheless, investors should remain mindful of several macroeconomic factors:

  • The incoming US administration's pursuit of tariffs could negatively impact ocean freight, though domestic North American trucking may gain from a renewed focus on onshoring strategies.
  • Efforts to resolve geopolitical conflicts, including the Russia-Ukraine war and unrest in the Red Sea, may mitigate supply chain constraints while potentially increasing capacity.
  • A focus on economic stability and growth may lead to greater Federal Trade Commission (FTC) tolerance for dealmaking, thus opening new avenues for sector consolidation.
  • A soft landing in the US economy could spur higher consumer demand, further enhancing M&A opportunities as T&L activity rebounds.

These dynamics underscore a promising outlook for the T&L sector, with strategic M&A poised to capitalize on improving market conditions.

Strategic thinking

Like many other sectors, dealmakers in the T&L sector faced considerable uncertainty in the first half of 2024, grappling with concerns over the trajectory of interest rates and the likelihood of a soft landing for the economy. Low freight rates and capacity overhang persisted, posing challenges to valuations and tempering enthusiasm for M&A in the early part of the year.

Toward the end of the year, the US election introduced further complexities in predicting the future of the T&L sector and its attractiveness for deals. The trade policies of a new administration could significantly affect supply chains, nearshoring and importing activities. Shifts in regulatory stances might influence the sector's environmental trajectory and openness to large-scale M&A. Additionally, the energy policies of the new administration could lower fuel prices. Given these variables and valuation challenges, it is unsurprising that M&A activity, although starting to rebound, remains relatively restrained.

informative stat

What to watch

In the coming months, it's crucial to monitor the upcoming administration’s stance on trade policy and regulation, as this can influence trade flows, the energy transition agenda and M&A. Consumer sentiment will also play a vital role, as shifts in consumer demand could affect demand for T&L.

The trucking and railroad sectors will warrant close attention. In trucking, the impact of consolidation at the lower end of the market and easing regulations may be key trends. In the railroad sector, innovation in first and last mile logistics — handling systems that use robotics and software to expedite the loading and unloading of goods — could be active, as railroads look for ways to expand their ecosystem.

Lastly, logistics is expected to continue evolving as a competitive differentiator in the consumer space. Keeping track of new advancements in logistics technology will be important, as it can greatly improve how efficiently and effectively businesses operate. These innovations are expected to reshape supply chains and improve the customer experience — and will continue to attract investor interest.

What to do next

Dealmakers should prepare for a dynamic year in 2025, marked by a rebound in M&A activity. This resurgence is likely to be driven by substantial capital reserves, lower interest rates and optimism about a soft economic landing. The new administration's supportive stance toward dealmaking is also likely to stimulate the market. To navigate this environment, dealmakers should prioritize a well-defined diligence and value creation strategy that is both effective and repeatable. Building strong confidence in value creation opportunities will be key, as will having a trusted team of advisors capable of managing multiple processes concurrently.

In today’s competitive deal environment, attracting and nurturing the right talent is critical for success. Building a team with the expertise and agility to respond quickly to opportunities and challenges will position dealmakers to take full advantage of the expected rise in M&A activity, paving the way for meaningful growth.

“T&L deals activity is set to rebound, driven by demand recovery and supply rationalization. However, macro factors such as trade policy and deregulation will continue to shape M&A opportunities.”

— Darach Chapman, US Transportation and Logistics Deals Leader

The bottom line

The transportation and logistics (T&L) sector is witnessing an uptick in dealmaking spurred by favorable economic conditions and investor confidence. Following the Fed's first rate cut in over four years and the incoming administration's deregulatory agenda, M&A activity is set to rebound. While financial buyers' participation has slowed, strategic participants are driving deals, especially as freight rates and profitability stabilize. Key trends to watch include trucking consolidation, railroad logistics innovation and advancements in logistics technology. For dealmakers, agility in funding, talent retention and a robust M&A playbook will be critical to capitalize on the anticipated market upswing.

Explore national M&A trends

Our solutions

Acquisitions Capital Markets Deals Strategy Divestitures

{{filterContent.facetedTitle}}

Required fields are marked with an asterisk(*)

By submitting your email address, you acknowledge that you have read the Privacy Statement and that you consent to our processing data in accordance with the Privacy Statement (including international transfers). If you change your mind at any time about wishing to receive the information from us, you can send us an email message using the Contact Us page.

Hide
Audit and Assurance services Consulting Tax services Newsroom Alumni US offices Contact us

© 2017 - 2024 PwC. All rights reserved. PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structure for further details.