Why did Forward Air pause the sale of its intermodal unit?

Forward Air paused the intermodal sale because Q3 revenue hit $63.5 million, the best performance in over three years. CFO Jamie Pierson stated the unit is "back on track" and that the company would only reopen the sale if market valuations reached what management considers fair value. The company decided keeping and growing the unit internally was a better strategic choice than selling at current prices.

What does this mean for my drayage contract renewal with Forward Air?

Shippers with Forward Air drayage contracts renewing soon should prepare for rate increases. The company has already implemented "strategic rate increases" on several accounts and is focused on maintaining and growing the intermodal business. Drayage revenue per shipment increased 14.1% to $986 in Q3, suggesting the company has pricing power and intends to deploy it during contract negotiations.

Is the intermodal business recovery sustainable?

The recovery shows mixed signals. Q3 revenue of $63.5 million was strong, and Q2 posted the best EBITDA in five quarters. However, year-to-date 2026 intermodal revenue ($176.3 million through nine months) still trails 2025 ($180.0 million). Operating income also declined from Q2 to Q3 despite rising revenue, suggesting cost pressures. Forward Air expects Q4 trends similar to Q3, but normal seasonal headwinds and the smaller number of working days make year-end performance uncertain.

What was the original scope of Forward Air's divestiture plan?

Forward Air announced in May 2025 that it would sell the intermodal unit along with two smaller legacy Omni Logistics businesses, representing approximately $394 million of 2025 revenue. Intermodal was the largest piece at roughly $230 million. The two smaller units have since been sold for about $25 million, but intermodal is now being retained as the company believes it is worth more kept than sold.

How is Forward Air's pricing driving profitability gains?

Forward Air's intermodal profit is growing three times faster than revenue, indicating rate increases are sticking. Operating income rose 26.4% while revenue grew 8.8%, and EBITDA margins improved 110 basis points to 8.2%. The drayage rate per shipment climbed 14.1%, suggesting pricing is the primary growth driver rather than volume expansion, which typically signals strong negotiating position and market demand.

Shipping & Freight

Moderate

Forward Air Pauses Intermodal Sale as Drayage Rates Rise 14%

Nov 12, 2026

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The signal

Forward Air has paused the sale of its intermodal business after third-quarter performance rebounded to its strongest level in over three years, generating $63.5 million in revenue and posting drayage charges of $986 per shipment, up 14.1% year-over-year. The company initially announced the divestiture in May as part of a broader strategic review triggered by investor pressure following its Omni Logistics merger, but the business unit's operational turnaround has now prompted management to reconsider and retain it for growth rather than sell at current market valuations.

For shippers relying on Forward Air for port and rail drayage services, this development signals a shift toward price-focused growth, with several accounts already subject to "strategic rate increases" that are showing strong profitability results. Margins improved 110 basis points year-over-year to 8.2% EBITDA, with operating income climbing 26.4% despite revenue growth of only 8.8%, indicating that the recovery is being driven by pricing power rather than volume gains.

Year-to-date intermodal revenue of $176.3 million still trails 2025 performance at $180.0 million through nine months, so the fourth quarter will be critical to validating whether this turnaround is sustainable or cyclical.

How this affects:

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Frequently Asked Questions

What This Means for Your Supply Chain

Simulation Suggestion

this month

What if Forward Air sustains 14% annual drayage rate increases over the next two years?

Simulate the impact of sustained 14% year-over-year rate increases applied across Forward Air's drayage customer base over the next 8 quarters. Model the effects on total cost of goods sold for a mid-size shipper with $50 million annual ocean freight volume using port drayage services, including volume elasticity (potential customer churn if rates rise faster than market alternatives).

Run this scenario

Simulation Suggestion

this month

What if Forward Air loses market share to competitors due to rate hikes?

Model the scenario where Forward Air's aggressive pricing strategy causes 10-15% of its customer base to switch to competitor drayage providers over the next 4 quarters. Analyze how this would affect lead times and service levels if customers are forced to shift to less familiar carriers with potentially different operational procedures and pickup/delivery reliability standards.

Run this scenario

Simulation Suggestion

strategic

What if Q4 intermodal volume falls short of management expectations due to seasonality?

Simulate a Q4 outcome where intermodal revenue growth decelerates to 3-5% instead of the Q3 momentum rate of 8.8%, driven by typical year-end seasonality and fewer working days. Model the impact on Forward Air's full-year 2026 intermodal revenue trajectory and the implications for the company's confidence in retaining versus selling the unit.

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