GE Trailer Fleet Services
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|Fate||Sold to Element Financial and Arval|
|Founded||Philadelphia, Pennsylvania (1957)|
|Joe Artuso (Chairman and CEO)|
GE Trailer Fleet Services (formerly Transport International Pool, Inc. (TIP)) was a wholly owned affiliate of GE Capital, which is a subsidiary of General Electric. Founded in 1957, the business rented and sells truck trailers. These 48 and 53-foot trailers were primarily used to haul raw materials to factories, and finished goods to distribution centers and retail stores. Older trailers were often used as storage units in retail, agricultural and other applications.
In 2013, GE sold its Canadian fleet operations to Element Financial. In 2015, GE sold its fleet operations in the United States, Mexico, Australia and New Zealand to Element Financial and its European operations to Arval, a unit of BNP Paribas.
Formation and Early Company History: 1957–1979
Transport International Pool began as “Container Leasing, Inc.” founded on September 12, 1957 by a group of entrepreneurs at 43 South 19th Street, Philadelphia, Pennsylvania. The company’s official filing stated that Container Leasing, Inc. would “engage in the business of buying, selling, renting and/or leasing for hire all type of trucks, automotive equipment, railroad equipment, marine equipment, aircraft equipment, and containers of any type and description, and any other items of like nature used in the transportation of general merchandise of any kind whatsoever.”
By August 1959, Container Leasing, Inc had eight shareholders, led by the original majority owner, Solomon Katz. Katz was also president of Strick Corporation, a trailer manufacturer. After another executive at Strick Corp., William “Bill” Sennett, observed that customers were increasingly asking for rental trailers, the Katz and Sennett founded Rentco, a separate business that used trade-in vans from Strick to serve the rental demand.
Katz named Sennett president of the new Container Leasing business, and its legal framework was used to form a new trailer rental business. In May 1966, Container Leasing changed its legal name to Transport Pool. The firm was operated from an office in California, and its first branch was in North Bergen, NJ. Other locations soon followed in Los Angeles, Chicago, Denver, Charlotte, NC and Trevose, PA.
In 1969, Sennett hired an Australian immigrant, Laurie Weisheit, as a salesman and later a branch manager. By this time the firm had four divisions: West, Midwest, South and Northeast. Weisheit became the Western division vice president in 1970 and began opening branches in quick succession. Transport Pool expanded into Canada in 1967, and in 1969 it started Space Rentals, an office trailer division that later became known as Modular Space, a provider of temporary office and classroom space.
Sennett and CFO Michael Morris expanded the business into Europe in 1969, opening a branch in the United Kingdom and a corporate office in Rotterdam, the Netherlands. By the end of that year, Transport Pool was operating 25 U.S. and five foreign branches. Transport Pool opened more branches between 1969 and 1974, bringing the total to 96.
Soon, the firm became the first national trailer rental company to introduce a mileage charge and a collision/damage waiver. In 1971, a holding company of Transport Pool was listed by NASDAQ. When recession hit in 1975, the firm’s stock dipped to $2 per share. Minneapolis-based Gelco Corporation, a firm that leased cars and trucks to large corporate fleets, offered $5 per share (about $30 million), and Katz, still the majority shareholder, sold the company, which had about 500 employees at the time.
Transport Pool’s operation changed little under Gelco’s supervision. Sennett retired the same year, Morris became president, and Weisheit was named executive vice president in 1977, moving to Philadelphia to head sales and marketing. By the end of the 1970s, TIP had more than 100 branches, however growth through just opening additional locations was becoming impractical.
The trucking industry in the U.S. was deregulated in 1980. Prior to deregulation, the authority to transport certain goods along certain routes was trading for hundreds of thousands of dollars, as regulatory hurdles made acquiring new authority difficult. To deal more effectively with outdated inventory coming in from rental and lease deals, TIP launched its first formal remarketing trailer sales operation in 1980.
After the Motor Carrier Act of 1980, there were 18,000 regulated trucking companies. More than 42,000 such companies were operating by 1989. Many of these new companies were unable to afford to buy trailers and looked to rental companies to fill the need for trailers.
Transport International Pool had 130 branches as of 1988. The extra demand that deregulation caused, combined with TIP’s continuing growth, resulted in an annual need for new trailers. Division managers would give their requisitions to Laurie Weisheit, who became president and chief operating officer in 1982, and he would consolidate the purchasing requests. Weisheit would then negotiate with the leading trailer manufacturers for volume purchasing deals.
Purchase by GE Capital in 1987
Gelco's acquisition of CTI Container Corporation resulted in financial losses that TIP’s profits were ultimately unable to offset. In 1986 and 1987, Gelco reported losses of $6.4 million and $4.9 million, respectively. To recover, Gelco sold TIP Europe in 1986 to a management and investor consortium. Then, in December 1987, GE Capital Service], a unit of Fairfield, Connecticut-based General Electric, bought Gelco for about $414 million.
At the time, Gary Wendt, president of GE Capital, told The New York Times the purchase was complementary to the company’s plans to grow its rail-car, aircraft, auto and container leasing businesses. While the other Gelco divisions were rolled into existing parts of the portfolio, TIP was brought in as a stand-alone division of GE Capital.
Since its acquisition by GE Capital, TIP's growth had been modest. In 1992, GE Capital brought in Robert M. Agans, one of its financial executives with extensive M & A experience as CEO of TIP and GE Capital Modular Space.
Following two acquisitions in its core product area, Canadian company Intercan Leasing in November 1992 and Transamerica Corporation’s 19,000-trailer U.S. fleet the next month, TIP became the largest North American truck-trailer renting and leasing firm, and now owned about 62,000 trailers. Later, in 1998, TIP bought the Chicago-based Trailer Leasing Co. to further expand its domestic trailer rental and lease business.
TIP also took actions to grow and formalize its intermodal container business. In August 1997, GE Capital consolidated TIP Intermodal Services and Genstar Container Corporation, calling the new entity TIP Intermodal Services. This added Genstar’s 18,000 intermodal containers to TIP’s 6,000-unit fleet. Subsequent intermodal business acquisitions brought the total intermodal fleet to more than 100,000 assets in 1999.
TIP opened its first Mexico branches in 1994 in the northern industrial city of Monterrey, and in Mexico City. In April 1993, it bought back TIP Europe PLC, and Barry DeSantis was appointed in 1994 to run the division, and was its president until 1998.
In the U.S., TIP faced an increasing problem in the 1990s with obsolete equipment, driven in part by the asset portfolios it was acquiring as well as changing specifications in the industry. After discussion, another TIP unit was created in 1997, National Trailer Storage (NTS). They aimed to reuse older trailers in the storage and cartage market.
TIP was soon starting to face increased competition. Customer service became more emphasized and in the late 1990s, credit card orders and 24-7 access via 800 numbers and the Internet became more important to the company.
As the economy faltered during the 1990s, TIP's revenue fell and its margins tightened. Many of its customers were going bankrupt, fuel prices reduced profits, and the global economy was changing traditional trucking routes. The rapid expansion of big box retailers created entire new private fleets with needs of their own. Technology required major investments and a change in core business processes. TIP needed financial assistance of its parent company in order to work technologically, but GE Capital faced changes as well.
Gary Wendt, the head of GE Capital Services (GECS) who had led the business the entire time TIP had been with GE, left in 2000, and was replaced by Dennis Dammerman as chairman and Dennis Nayden as president and CEO.
In August 2002, GE’s new chairman Jeff Immelt announced the reorganization of the GE Capital Services portfolio into four business units, portions of which were later grouped with GE’s industrial-side businesses.
TIP ultimately became part of a new division named GE Equipment Services, part of GE Industrial, along with related businesses such as Rail Services, GE’s Penske Truck Leasing limited partnership, the GE SeaCo marine container joint venture and Equipment Services Europe (ESE). The ESE business included the former TIP Europe trailer business, which had separated from TIP in the United States by then, but was still part of GE.
To further balance the portfolio, Equipment Services transferred the TIP Intermodal business and assets in 2002 to GE’s Rail Services unit in Chicago, which allowed it to benefit from relationships the business had with rail customers and shippers.
TIP went back to its core business model of renting, leasing, financing, maintaining and remarketing trailers, primarily dry vans, flatbeds, and refrigerated vans. There was a new leadership team was in place, partly shared with GE Modular Space, the offshoot of TIP’s 1969 entry into portable office and classroom trailer leasing.
TIP changed its name in August 2004, to “Trailer Fleet Services.” The action was partly a requirement of new GE branding guidelines, and partly to leverage GE’s brand strength.
Maintenance Services were first offered in 2000, and include providing maintenance services on company-owned and customer-owned trailers, said Tony O’Brien, in 2010 the Remarketing Services vice president for Trailer Fleet Services.
The company then designed its own trailer-tracking system, had it validated and tested at GE's Global Research Center in upstate New York, and launched the VeriWise asset monitoring product in April 2003.
- Bray, Chad (2015-06-29). "G.E. to Sell Bulk of Fleet-Financing Business for $6.9 Billion". The New York Times. ISSN 0362-4331. Retrieved 2015-11-11.
- I.D. Systems Buys Asset Intelligence in $15 Million Deal, truckinginfo.com, Jan. 13, 2010