(MT Newswires) --
The mergers and acquisitions landscape for the transportation and logistics sector is 'primed for a resurgence' this year, according to a report published by investment bank Harris Williams in early January.
The expected resurgence will be buoyed by renewed dealmaking appetite among both buyers and investors, according to the report's projection.
"Many areas continue to demonstrate resilient demand, well-established growth drivers, and intact fundamentals, including automotive and heavy-duty aftermarket, third-party logistics and transportation infrastructure services," Harris Williams' Outlook 2026: Transportation & Logistics report stated.
The report described a market where "quality is king" and strategic options are expanding. It described the third-party logistics landscape as "very dynamic" and projected that heading into 2026, the best third-party logistics providers would grow and capture market share by expanding their services suite, adopting innovative technology, identifying cost-saving initiatives and helping shippers diversify and strengthen their supply chains.
"A key area in which many other top-tier 3PLs [third-party logistics providers] are finding an edge is specialization," the report stated. "In a volatile freight market, those focused on specific, resilient end markets or complex service offerings are outperforming the competition."
Meanwhile, the report indicated that AI adoption could unlock "significant opportunities" for what it described as "forward-thinking logistics providers" to separate themselves from the competition.
With regard to the automotive and heavy-duty aftermarket, the report indicated that growth-focused investors were prioritizing companies with "nondiscretionary demand, recurring revenue and a demonstrated ability to manage tariff turbulence".
"Transportation / Logistics is definitionally cyclical, which in part is what keeps the T&L [transport and logistics]-focused private equity investor universe smaller to begin with," Kyle McNickle, managing director at Robert W. Baird & Co., told MT Newswires in written comments. "Couple an already small investor universe with a much-prolonged freight recession, the strong performing businesses have really stood out from the crowd."
"Generally speaking, logistics providers who are serving highly-regulated industries like pharmaceuticals carry significant barriers-to-entry, while also proving "sticky" to their customers. As such, when you look at the performance of these businesses over the last several years, they are often the types of companies who have continued to grow top and bottom line amidst an otherwise challenged freight cycle," McNickle added.
Ioannis Koliousis, associate professor at Cranfield School of Management, told MT Newswires in an email that buyers are favoring stability. "To me, sectors like healthcare, pharma, defence and regulated goods are the ones with higher focus," he explained, adding that "compliance is like a moat" and that "failure costs dwarf transport costs, so price sensitivity is lower". Koliousis added that: "switching costs are high, improving margin durability".
Andrew Bahlmann, founder of Deal Leaders International, told MT Newswires that the focus of buyer activity in the private sector had transitioned from "broad freight exposure" - such as a general freight business - to businesses with "predictable demand," "pricing discipline," and "defensible niches."
A significant change in the focus of buyer activity has been their desire for "earnings quality and downside protection" rather than simply "volume growth", he added.
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