Infrastructure Fuels J. B. Hunt Intermodal

by Andrew Jensen  on Monday, Apr. 7, 2008 12:00 am  

Vision Realized

Back in 1990, the late company founder J.B. Hunt and then-BNSF president Michael Haverty spoke enthusiastically about $90 million in new business thanks to the deal.

The two have rightly been declared visionaries in the two decades since.

BNSF’s operating revenue has skyrocketed 21.7 percent in the last three years, growing from $12.98 billion in 2005 to $15.8 billion in 2007.

Since 2000, J.B. Hunt’s operating revenue from its intermodal division has leaped 142 percent from $681.1 million to $1.6 billion in 2007.

Over the same period, J.B. Hunt’s over-the-road trucking revenue has advanced less than 1 percent, from $833.8 million to $841.7 million.

High diesel prices and a slowing economy in 2007 reduced its OTR revenue by 12.8 percent from 2006. Meanwhile, intermodal revenue increased 15.6 percent, just above its average annual growth rate of 13.5 percent since 2000.

Not only has intermodal been J.B. Hunt’s largest source of operating revenue since 2003, when it first surpassed the trucking division, it is also easily the most profitable.

Intermodal represented 47 percent of J.B. Hunt’s total 2007 revenue but accounted for 65 percent of its net income, or $239 million.

Bergant, an executive at the company for 30 years and the president of intermodal since 2004, said despite its trucking history, J.B. Hunt’s indifference to the OTR model is what allows it to excel at intermodal.

“We’ve never had a truck or intermodal preference and that continues today,” Bergant said. “A lot of competitors have tried to imitate it, but they still have a foot stuck in the trucking world.”
 

Sustainable Growth

 

 

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