Dave Bozeman, CEO of CH Robinson.
Source: CH Robinson
As Dave Bozeman takes the stage during his first investor day as CEO of C. H. Robinsonhe will face a freight recession, the threat of higher tariffs and the turnaround of a century-old logistics giant.
“I want to lay out our vision and we've actually already started to execute on that,” Bozeman told CNBC in an exclusive interview Thursday ahead of the company's investor day. “We will grow our market share and increase our overall operating margins.”
On Thursday, executives from the shipping company will present new financial targets, answer questions about the shift to a streamlined business model and provide an update on business conditions, including the potential impact of President-elect Donald Trump's proposed tariffs.
Trump has said he will impose tariffs of 60% on goods from China and 25% on goods from Mexico and Canada. That could have a material impact on CH Robinson, which transports goods around the world for nearly 100,000 customers.
CH Robinson's major business segments include global freight forwarding, often referred to as freight brokerage between the U.S. and other regions; and North American surface transportation, in which freight is transported primarily over land.
Analysts estimate that CH Robinson is a top 3 carrier on the China-US freight route, and the company says it carries about 10% of the freight on the US-Mexico route.
“Some shippers will say, 'We'll take that rate.' The economics of that volume will probably change in terms of prices and things like that. Regardless, we're still going to move that freight,” Bozeman said. “The freight still has to move. It could be that he moves to a different starting point, and we would still be there to move that.”
Citi transportation analyst Ari Rosa upgraded CH Robinson to a buy rating in November. He believes the tariffs create a short-term boost for freight and agrees with Bozeman that the company has the long-term ability to mitigate the impact of potential tariffs.
“There is no doubt that their global freight forwarding activities are very sensitive to China,” Rosa told CNBC. “But I do think their activities are diversified enough that they can work through tariffs.”
New era
Technology will also be the focus of Thursday's investor day, including CH Robinson's collaboration with Microsoft and using Azure AI.
“We've been working hard on AI. It's a game changer for us and especially for our size,” Bozeman said, noting that the partnership with Microsoft has been a great value-add, but that much of the work is being done internally done.
“Our engineers actually create the big language models. We send out 10,000 email quotes [per day] that are deployed via large language models. I am very pleased with the productivity we have had using this technology,” said Bozeman.
“We can send quotes back to customers in a conversational manner in less than two minutes,” he said. “It now allows our people to solve and execute things together with our customers, instead of spending time on menial tasks.”
This week, Wells Fargo analyst Christian Wetherbee upgraded shares of CH Robinson in a note, writing in part: “We see a unique opportunity to grow earnings through '27, driven by improved execution (led by technology), which should lead to stock gains and margin expansion.”
Key to all of Bozeman's goals for CH Robinson is the shift to a new, streamlined business model focused on continuous improvement and reducing activities and inefficiencies that do not add value to the business or the customer.
A lean model is relatively new in logistics. However, it is used in 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, easily outperforming 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 will be a company that is easy to invest in because it is the market leader.”
