Dave Bozeman, CEO of CH Robinson.
Source: CH Robinson
Dave Bozeman takes the stage at his first investor day as CEO CH RobinsonHe has to contend with a freight slowdown, the threat of higher tariffs and changes at the century-old logistics giant.
“I want to lay out our vision and that we’ve already started executing,” Bozeman told CNBC in an exclusive interview ahead of the company’s investor day on Thursday. “We’re going to grow market share, and we’re going to expand our overall operating margin.”
Shipping company executives on Thursday will present new financial targets, answer questions about the shift to a leaner operating model and provide an update on business conditions, including the potential impact of President-elect Donald Trump’s proposed tariffs.
Trump said he would impose a 60% tariff on goods from China and 25% on goods from Mexico and Canada. This could have a material impact on CH Robinson, which transports goods around the world for around 100,000 clients.
CH Robinson’s principal business segments include global forwarding, often referred to as freight brokerage between the United States and other regions; and North American Surface Transportation, which primarily transports freight over land.
Analysts estimate CH Robinson is the top 3 carrier in the China-US freight lane, and the company says it carries about 10% of the freight in the US-Mexico lane.
“Some shippers will say, ‘We’ll take that duty.’ The economics of that volume will probably change in price and things like that anyway we’re still going to move that freight,” Bozeman said. “The freight still needs to be moved. It just might go to a different starting point, and we’ll still be there to move it.”
Citi Transportation analyst Ari Rosa upgraded CH Robinson to a buy rating in November. He believes the tariffs are creating a short-term drag on freight products and agrees with Bozeman that, long-term, the company has the ability to mitigate the impact of potential tariffs.
“There’s no question that their global forwarding business is very open to China,” Rosa told CNBC. “But I think their business is diverse enough that they can work through tariffs.”
new era
Technology will also be a focus at Thursday’s investor day, with a partnership with CH Robinson Microsoft and use of Azure AI.
“We’ve worked hard with AI. It’s a game changer for us and especially for our scale,” Bozeman said, adding that the partnership with Microsoft has been a big value-add, but most of the work has been done internally.
“Our engineers actually do large language models. We’re driving 10,000 email citations (per day) that are being deployed through large language models. I’ve been really pleased with the productivity we’ve gotten using this technology,” Bozeman said.
“We were able to get quotes back to customers in less than 2 minutes in a conversational manner,” he said. “It allows our people to now work with our customers to solve and execute and resolve things, versus spending time on trivial tasks.”
This week, Wells Fargo analyst Christian Weatherby upgraded CH Robinson stock in a note, writing in part: “We see a unique earnings opportunity through ’27, driven by improved execution (led by technology), which should lead to share gains. . and margin expansion.”
Key to all of Bozeman’s goals for CH Robinson is the transition to a new lean operating model, focused on continuous improvement and reducing operations and inefficiencies that do not add value to the enterprise or the customer.
A lean model is relatively new in logistics. However, it is used amazon, caterpillar And Ford — All companies where Bozeman has served as a top executive.
The shift has been well received. Shares of CH Robinson are up more than 25% this year, outpacing the Dow Jones Transportation Average’s roughly 7% gain over the same period.
“I’m building a new company, a new culture,” Bozeman said. “It’s going to be a company that’s an easy bet to invest in because it’s a market leader.”
