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  5. ODFL: UPS drivers in US apparently negotiated an annual salary of $170k, which is startling of course, and concerning about operational control in the shipping sector. [Old Dominion Freight Line Inc.]
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Q: UPS drivers in US apparently negotiated an annual salary of $170k, which is startling of course, and concerning about operational control in the shipping sector. Could you please comment on impact to major providers in the sector, including TFII?
Asked by Peter on August 28, 2023
5i Research Answer:

There is labour cost pressures across the board, and it may start to impact margins. That being said, this is not a surprise to investors and nearly every company comments on labour in the confernce calls. So it becomes a question of how pervasive it is and how long the inflationary pressures last, vs the overall growth of the economy and the company. TFII has noted some weakness, but, at least for now, investors are looking beyond this and still expect growth. This may change if there are more strikes and/or other labour pressures, beyond current expectations. 

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