Following their late 2021 announcement, in which Vienna, Va.-based LaserShip, the largest regional e-commerce parcel carrier and last-mile delivery services provider, and Chandler, Ariz.-based regional shipping services provider OnTrac, announced they had entered into a definitive agreement to merge, with LaserShip acquiring OnTrac for $1.3 billion, the companies last week stated they are taking a major next step in the process.
That process, the companies said, is the rollout of a new transcontinental delivery service, which they said is focused on helping retailers reach consumers in the nation’s most populated regions with faster and more reliable home delivery at a cheaper cost. And they added that this service will connect the companies East and West Coast delivery footprints, moving packages both way in three days.
When the merger was initially announced, LaserShip and OnTrac said they would form the only pure-play national e-commerce solution in last-mile parcel delivery and enhance customers’ ability to meet growing demand in the consumer delivery market. And they added, at the time, that in order to ensure continued exceptional service through the holiday season with expectations of heightened shipping volumes, LaserShip and OnTrac would not begin to link their networks until 2022 and would operate independently until then.
Josh Dinneen, Chief Commercial Officer at LaserShip and OnTrac, told LM that this transcontinental service is a huge win for retailers, as it empowers them to reach consumers in the country’s most populated areas with faster, reliable, cost-effective home delivery.
“As national carriers continue to implement surcharges and off-schedule rate increases, our transcontinental service gives retailers a proven alternative that can help them diversify their carrier mix, increase flexibility and capacity, and scale their businesses by reaching 74% of the U.S. population across 30 states and Washington, D.C.,” he noted.
What’s more, Dinneen explained that the transcontinental service launch was based on overwhelming feedback LaserShip and OnTrac received from their customers about the need for a carrier with their speed, reliability, cost-savings and service, but with nationwide scale.
“Our new service fills that void and we’re excited to serve as a supportive, long-term partner for our customers,” he said. “We are also expanding to Texas in the first quarter of 2023 in the urban megaregion of Austin, Dallas, Houston and San Antonio to reach an additional 19 million consumers.”
In terms of the competitive benefits the network’s launch provides, Dinneen said it goes back to how retailers have had to balance consumer expectations of free and fast home delivery with rising delivery rates, surcharges, and capacity constraints that erode profitability and customer satisfaction.
“By connecting our East and West Coast delivery footprints and launching our transcontinental service, LaserShip and OnTrac help retailers solve that problem, as we have evolved into a critical part of the e-commerce infrastructure,” he said. “Leading omnichannel retailers and direct-to-consumer e-commerce brands have already signed up to secure volume ahead of our launch. Our new service enables our combined company to provide delivery solutions on a national scale. We look forward to continuing to innovate for our retail partners in the future.”
When LaserShip and OnTrac first announced the merger, Rob Martinez, founder and co-CEO for San Diego-based Shipware, an audit and parcel consulting services company, told LM that it should be viewed as good news for parcel shippers, as the parcel industry has been clamoring for alternatives to FedEx and UPS for years.
“Having real competition nationally can potentially reign the runaway price increases we've seen over the past couple of years,” he said. It’s also great for the industry in general and it is exciting to see significant investment continue to pour into the logistics and delivery space.”