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Mike Rosendahl

E: mrosendahl@pcecompanies.com

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Industry Trends

Trucking Demand Remains Unsteady

Demand for commercial vehicles in the medium and heavy-duty sectors is expected to decline in 2024 due to an imbalanced freight environment and margin pressures affecting buyers' capital expenditures. However, robust vocational markets, and preparations for the EPA'27 mandate may mitigate this downturn. Additionally, due to pent-up demand and expected consumer financial stability, demand for for medium-duty vehicles is projected to remain stable in 2024. An uptick in in demand is anticipated for 2025 driven by improved economic conditions and reduced retail inventory corrections.1

Airlines Ready for a Strong Q4

Business aviation is poised for a positive 2024, as companies return to pre-pandemic travel levels and curtail virtual meetings. Escalating rental car prices are driving more travelers to consider air travel. The trend of combining business with leisure is growing and creating more travel opportunities. An increase in business pilot licenses signals a preference for private flying. Despite ongoing health concerns and challenges, the industry is optimistic, with new jet deliveries and a bright outlook for business aviation entering Q4.2

Logistic Centers and Warehouses Benefit From the Pandemic Supply Chain Issues

The industrial real estate market is cooling down as companies lease less warehouse space due to weak freight demand, high-interest rates, and shifting consumer spending. However, the market remains historically tight. While leasing has slowed, demand is still strong by historical standards, as warehouse rents rise. To counteract supply chain issues, companies are expanding and holding more inventory closer to customers. While major distribution players have seen tempured growth, smaller logistics operators are finding opportunities and will likely maintain momentum to close out the year.3

Diesel Price Forecast Rises To Match Inflationary Environment

The U.S. Energy Information Administration (EIA) has revised its diesel price outlook for 2023 and 2024, expecting higher prices. The new forecast predicts an average of $4.31 per gallon for on-highway diesel fuel in 2023 and $4.07 per gallon in 2024, up from the previous estimates of $4.17 and $3.94 per gallon, respectively. This adjustment is driven by stronger diesel crack spreads and lower distillate inventories, resulting from refinery maintenance and reduced supplies on the East Coast, potentially leading to higher diesel prices.4

Largest Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • NCH International Trade Services Corporation
  • TECMA Customs Solutions LLC
  • n/a
  • U.S. Marine Management LLC
  • Maritime Partners, LLC
  • n/a
  • Blue Force Technologies, Inc.
  • Anduril Industries, Inc.
  • n/a

Other Financial Buyer Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • n/a
  • n/a
  • n/a

Other Strategic Buyer Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • n/a
  • n/a
  • n/a

 

Source S&P Capital IQ as of 10/10/2023 and PCE Proprietary Data

PCE Transactions

Contacts

Michael Rosendahl

New York Office

201-444-6280 Ext 1 |

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Eric Zaleski

Chicago Office

847-239-2466 |

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Kyle Wishing

Atlanta Office

404-994-4186 |

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Data Assumptions

This report represents transaction activity as mergers & acquisitions, consolidations, restructurings and spin-offs. Targets are defined as U.S. Based companies with either foreign or U.S. based buyers. Transaction information provided is based on closed dates only.

Glossary

EBIT - Earnings Before Interest and Taxes
EBITDA - Earnings Before Interest, Taxes, Depreciation, Amortization
LTM - Last Twelve Months
TEV - Total Enterprise Value

Sources:

  1. 1. “Trucking Industry Forecast for 2023.” ACT Research, www.actresearch.net/resources/blog/trucking-industry-forecast.
  2. 2. Trever. “Business Travel Trends for 2024.” Inflight Pilot Training, 2 Sept. 2023, inflightpilottraining.com/2023/09/business-travel-trends-for-2024.
  3. 3. Young, Liz. “How Warehouses Are Escaping Real Estate’s Doom Loop, in Charts.” Wall Street Journal, 20 Sept. 2023, www.wsj.com/articles/how-warehouses-are-escaping-real-estates-doom-loop-in-charts-2728d7ea.
  4. 4. “EIA Bumps up USA Diesel Price Forecast.” Www.rigzone.com, www.rigzone.com/news/eia_bumps_up_usa_diesel_price_forecast-18-sep-2023-174029-article.
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