CRST president, CEO Mike Gannon discusses trucking company’s past, present and future

It’s become a tradition of sorts for CRST to be named the Corridor Business Journal’s Largest Privately Held Company.

The Cedar Rapids-based trucking firm has topped the CBJ’s LPH list every time it’s been published — in 2012, 2014, 2016, 2018, 2020, 2023 and again this year.

But the 2025 designation hasn’t come without its challenges. CRST’s revenue has declined nearly 25%, from $2 billion in 2022 to $1.536 billion in 2024 — a result of a historically challenging period in a trucking industry that’s been buffeted by a host of headwinds.

Still, CRST continues to rank among the largest trucking and logistics companies in the United States, with more than 4,600 employees and a keen eye on the future as the company prepares to celebrate its 70th anniversary later this year.

According to a company timeline, CRST was founded in 1955 as Cedar Rapids Steel Transport by Herald (“Smitty”) and Miriam Smith out of a refurbished chicken coop they purchased for $125.

At the time, they had no trucks or customers, but Mr. Smith convinced firms he could save them money. He contracted with owner-operators hauling livestock to Chicago to return to the Cedar Rapids area with loads of steel instead of empty trucks.

The company was renamed to CRST in 1974, and after acquiring Malone Freight Lines in 1984, it was reorganized as CRST, Inc. to integrate all company operations.

The company launched its Logistics Solutions division in 1983 and its Dedicated Solutions division in 1985. By 2001, CRST ranked tenth nationally among dry van truckload carriers.

As revenue topped $400 million, CRST moved to a new headquarters facility in southwest Cedar Rapids in 2004, and several acquisitions followed: Specialized Transportation in 2011, Allied SPD in 2013, BESL in 2014 and Pegasus Transportation in 2015. After acquiring Gardner Trucking in 2016, CRST moved into its new 11-story, 113,000-square-foot corporate headquarters at the intersection of Second Avenue and First Street SE, forever redefining the downtown skyline.

The company has won a host of awards in recent years, including being named “Long Haul Carrier of the Year” by Uber Freight; honored among Caterpillar’s elite suppliers in 2024; by Home Depot as Flatbed Final Mile Carrier of the Year in 2023 and 2024; and winning two Quest for Quality awards for transportation service providers by Logistics Management Magazine in 2023, in the Industrial & Heavy-Haul and the Van Expedited — Dry Freight categories.

CRST is now comprised of five distinct business units:

Capacity Solutions, which finds smart and efficient solutions for transportation challenges across North America. Its core, asset-backed solutions — including regional, drayage and time-sensitive OTR — are augmented by an expansive third-party carrier network of transportation partnerships.

Dedicated Solutions, which engineers data-driven transportation solutions that maximize speed, efficiency and value to meet customers’ supply chain needs. Using modeling software and state-of-the-art systems, the division engineers, prices and manages dedicated fleets using a diverse set of company assets — including dry van, flatbed, heavy haul and validated refrigerated trailers — for various markets, from health sciences and grocery to building products and e-commerce.

Flatbed Solutions or Asset Light, providing safe and scalable flatbed and van trucking solutions across North America by leveraging the expertise and resources of a diverse network of agents and independent contractors to meet customer needs.

Home Solutions, providing final-mile services for customers across North America, offering custom deliveries and complex installations to every ZIP code in the continental United States through services from single-appointment delivery and installation to managed warehouses to cross-dock capabilities. The division executes nearly 3 million home deliveries and complex installations per year.

Specialized Solutions, offering high-value shipping, custom supply chain solutions and project logistics for customers requiring special handling and equipment through blanketwrap, white glove truckload and LTL shipping, providing real-time tracking and onsite delivery service. An extensive network and warehouse capacity — encompassing 3.1 million square feet across 60-plus locations and more than 1,400 secure third-party facilities — supports customers at every moment in the supply chain, including assembly, order fulfillment, kitting and reverse logistics.

New CRST president and CEO Mike Gannon took the company helm in August 2024 after serving in various leadership roles with CRST for more than four decades.

Over the last 40 years, Mr. Gannon has built a diverse and successful career at CRST, holding a variety of progressive leadership roles, including president of CRST Malone, president of CRST Expedited, group president of CRST’s Fixed Asset Division, and most recently, chief operating officer.

In the local community, Mr. Gannon serves as vice chair of the Xavier Catholic Schools Foundation Board. He holds a bachelor’s degree in Transportation Logistics from Iowa State University and an MBA from The University of Iowa. He and his wife Mollie have three daughters.

As part of this year’s CRST recognition, Mr. Gannon agreed to a one-on-one interview with the CBJ addressing a host of topics – from driver shortages and decreasing volume to the latest trucking technology, CRST maintaining its commitment to its Cedar Rapids roots, and if leaders would ever consider taking the company public.

---

Here, in lightly edited form, is the transcript of the CBJ’s interview with Mr. Gannon.

CBJ: Is CRST still coping with a shortage of drivers? What strategies has the company employed to address the issue, and how has the shortage impacted the types of routes run by CRST drivers?

Mr. Gannon: We’ve seen market ebbs and flows in driver availability. Since the freight recession the last two-plus years, it’s certainly been a looser market. It’s been easier to find drivers. Notably, it’s been better to retain drivers. I do think that’s part and parcel with the wage increases that happened during the pandemic.

But I would also say that at some point — I’ve been at this 40 years — it’s going to turn back. We will have some pain points. I think we’re more diversified and ready to handle it. I would tell you our strategies. First and foremost is aligning our positions as much as possible around the driver lifestyle. Specifically, driver home time is the big thing that we’ve changed over the last three to five years, putting drivers in position to be home more frequently, creating jobs that allow them to be home more frequently. The second one — and this doesn’t get enough play in the industry, but really, we’ve always been this way — we really emphasize safety, and that resonates with our drivers. When you tell them the most important thing is to get you home safe, it really resonates and makes them feel like you care about them. I take that to heart, and our team takes that to heart. And then the last is we have to be market competitive on wages, and we do that, but we also get direct feedback from our drivers on a regular basis.

Those are the three big strategies that we employ. Does it affect where we operate or how we operate? I would say freight market conditions have affected that more than the driver situation. Certainly in the past, it was more impactful on your ability to grow and serve customers, but it never really affected how we went to market. It just affected how much we could go to market. But right now, I don’t see anything that holds us back in that regard, what markets we want to be in from the driver front.

CBJ: So you’re not seeing a great shortage? You don’t have a number of open positions where you’re trying to hire and just can’t find the people?

Mr. Gannon: No, we’re in a good spot right now, across the board.

CBJ: And that is different than it may have been in previous years?

Mr. Gannon: I would say that’s different than most of my 40 years. Changing the jobs and the type of jobs and that home time certainly lends itself, but the driver market certainly is the loosest I’ve seen in my time.

CBJ: CRST closed its driver training school in 2022. Where do the company’s drivers come from now?

Mr. Gannon: Right now, our drivers mostly come as experienced drivers. So two things: One, as our jobs have become more regional or localized, we hire from experienced drivers. We still maintain contract partner schools across the country that we always had when we had the driving school. Unfortunately, we had to shut down the driving school, mostly because government regulation made it cost prohibitive, for both us and the applicant.

It was a very difficult decision, because we had a school that I think produced outstanding drivers, safe drivers. It was more the distance of commuting to Cedar Rapids and then going back home and getting the licensing set up, that’s what really changed things. The majority of our drivers we get with multi-year experience. We still rely on some schools, but those partnerships are 10-plus years.

CBJ: Will self-driving trucks be coming to the CRST fleet soon? If so, what percentage of the company’s fleet will be converted, and in what time frame?

Mr. Gannon: We don’t see any self-driving trucks in our fleet in the next 12 to 18 months. Beyond that, I don’t know that I can predict, just because the technology is evolving. I get asked this question frequently, and I would tell you, it’s an evolution. There are no driverless trucks operating commercially in America today. There are trucks with drivers in them. They can run autonomously, but they’ve still got a driver to watch it and guide it. It’s kind of like your hands-free. You go hands-free for a little bit, but you still have somebody in the car.

But there’s stuff that I think is just industry-changing. We just saw the fifth-generation Freightliner Cascadia, and it has cameras on all sides. It’s got mirrors inside, instead of mirrors outside. It gives the driver a virtual picture down the side of a trailer. Lane collision, collision avoidance, lane avoidance, anti-roll technology, things that help the driver. That’s the evolution.

I think we’ll get there at some point. But the idea right now that you’re going to have no human in an 80,000-pound vehicle running down the road, we’re a ways out from being there. I do think that it’s feasible in the next two to five years, that we’ll have trucks where a driver can be in the truck, but not have to be up and staffing the truck. Shorter, really tight local, I can see that developing. But the class A over-the-road 80,000-pound trucks, (it’s) tough right now to envision that that’s a viable part of the capacity solution versus real humans driving trucks. NOTE: Mr. Gannon requested that the following statement be added after our initial interview. “Although true driverless trucks are not operational on a large scale today, there are small pilot programs underway as the technology continues to be tested and improved, always prioritizing the safety of the motoring public.”

CBJ: That sounds like you’re saying it’s industry-wide that there wouldn’t be a move to fully driverless trucks.

Mr. Gannon: It’s talked about. And there’s practical applications being deployed today. But every one of them has a driver in the truck that is there to make sure that you can operate it, and there’s tests where it’s run, but a lot of times there’s two chase vehicles behind it and one in front of it to make sure nothing happens. I see it as something that will happen.

But the one I get excited about in the near term, in the next two to five years, is the advances in safety that make the motoring public and our drivers safer. It is some really cool stuff that assists the driver to drive, and it takes some of those decisions out of the driver’s hands and puts them in the trucks’ hand to operate better, safer and avoid collisions.

CBJ: Those are some of the same technologies that are emerging in the commercial auto fleet, right?

Mr. Gannon: I get wizbanged on it, because it’s pretty cool. This one we saw last week, it’s amazing. It has the two mirrors inside, and it shoots down the side of a trailer. You’ve got a tractor and a 53-foot trailer behind you, and you can see everything, whereas before, there were so many blind spots for a driver. And then you can match it up with the technology of automobiles, where if you didn’t have that, you can’t do the lane departure like you have in your car, because your car sees everything. Now you have this. It makes our drivers safer, and then you can retain drivers. And they get home. I can’t stress that enough. They get home safe.

CBJ: Will the company be bringing electric and alternative fuel tractors into its fleet? What are the advantages or disadvantages of those vehicles compared to diesel fueled trucks, and how does sustainability play into that equation?

Mr. Gannon: We brought five trucks in the fourth quarter last year in Southern California. The positives are (they’re) easier to maintain, certainly lower emissions. I think we all still have to be realistic about the disposal of batteries at some point, because the battery pack on a Class A truck is not small, so we’ve got to understand the sustainability of that. But right now, the advantage is just less parts to maintain. There’s no oil to change.

The disadvantages, or the challenges, right now, it is not economically viable. The cost of the (electric) truck is three times a diesel truck. The range of the truck is [variable] depending on weather and conditions, whether it’s too hot or too cold, and how much you have to run the air conditioner or the heat. With a diesel truck, the driver can run 500 miles in a day. We anticipate we’ll get 300-ish miles in a day (with an electric truck), so the cost of operating that vehicle just doesn’t support the market conditions. We’re just not going to get paid for the cost of operating that vehicle right now. It doesn’t mean it isn’t a viable technology. I do think CNG, compressed natural gas or hydrogen, are alternatives that people seem to be willing to lean towards because of this range thing on the electric trucks.

Now I’m not the engineer to know where electric trucks are going to go, but it is a technological marvel to me that they can even build an electric truck that hauls 80,000 pounds. To do it commercially, that’s a challenge. What we strive to do (for) sustainability is continue to evolve our fuel economy. We have idle smart on all our trucks. We really focus on improving fuel efficiency, all the things that burn less gallons and that’s where our focus is on sustainability.

This truck we just looked at (recently), the aerodynamics on it versus a truck even 10 years ago are amazing. The headlights are flat. It’s just so smooth. And they’ve got air intakes that are just amazing. They’re pretty slick.

CBJ: The trucks that you’ve brought into service in Southern California —are those basically being used more for short-haul?

Mr. Gannon: Yes, within the Southern Cal region. We’ll go out to Arizona with them. We want to test them out further, and we want to get some miles on them and get some tests with them. The other disadvantage or challenge we’ve had is just the infrastructure. It’s taken us a couple years just to get the power plants installed, because they’re so backed up installing them. We’ve had the trucks on order for two years, and it’s taken us that long to get the infrastructure to support running them. We delayed the delivery, delayed the delivery, and finally got them in the fourth quarter because we want to try them, but the California utilities that install the charging stations are just so backed up and so jammed up, that’s created some challenges for us that we frankly didn’t perceive when we bought them.

CBJ: According to our records, CRST’s revenue has declined from $2 billion in 2022 to $1.536 billion in 2024. What are the key factors contributing to that decline? How has CRST needed to pivot to account for that decline? And do you see that trend reversing anytime soon?

Mr. Gannon: One of the primary factors that affect that is rates. So from 2020 to 2022, it was just go, go, go, and rates really skyrocketed. Those rates have come down, and it’s been a challenge. That’s a meaningful portion of it. We’ve intentionally exited some businesses that we just said we cannot be successful serving customers and make money in, so there’s a portion there. And about a third of that reduction is market demand. We don’t have as much need, especially in our over the road space. That’s the most challenging.

We've grown away from our traditional OTR business. Our home solutions business, which we acquired in 2020, has been the most resilient and has been growing the best, and we continue to gain market share there. We are doing really well in that space, and that's outside traditional markets for us. And then our dedicated has grown nicely, and we continue to invest in technology, people and resources to bring diversified services, more different offerings, to that. We just started hauling donuts up in the Northeast with a combination of straight trucks and tractor trailers, so some pretty good stuff there with non-traditional freight markets. But the home solutions one is intentional. When we bought that, we really needed a different market, and that was a big pivot for us. And we've seen good growth in our logistics/brokerage, especially in our asset light, and we're leaning real heavily into that. CBJ: In a recent interview, Heartland Express CEO Mike Gerdin used the term “rough slog” for the trucking industry in the past two years, but he's predicting a rebound of sorts. Do you agree with that assessment? Mr. Gannon: In my 40 years, it’s the roughest slog I've been through by far. 2024 was a challenging, challenging market. He cited the worst ever. I would agree with him wholeheartedly. At the time, Mike was quoted as saying we're going to see a turnaround. I would have agreed with him. As first quarter numbers come in for us, and for all our peers in the industry, we're not seeing the rebound we thought. But to Mike's point, he said 2025 would be better than 2024, and we are seeing that. It’s just not coming as fast as we thought it would. We all thought we were going to see rates and market volumes come up a bit faster, and this is pre-tariff, but we thought things would turn around faster. I was in Mike's camp. We built our plan similar to what Mike talked about. We're not seeing that come out quite that fast. CBJ: The COVID-19 pandemic was a period of extreme growth, probably one of the best in the industry through 2022 but a number of factors – rising interest rates, inflation, the end of government stimulus – brought that surge to an end. What have been the largest issues to contend with in the wake of the pandemic – excess capacity, loss of demand, or other factors? Mr. Gannon: I think the overarching one is the excess capacity. And what surprises me in my time in this industry is usually the industry self-regulates. We tend to buy too many trucks, and we all went out and bought trucks, and ‘21 and ‘22 happens, and then we all shrink. That hasn't happened for some reason, and nobody can put their finger on it. But that excess capacity has led to probably the bigger challenge, which is that rates have come down dramatically, especially in the open road space, and we have certain business segments where our rates are down over 20% from the peak in 2022, and that's all on capacity. I certainly think market demand and freight volumes are challenged. It’s just become more difficult. And then the last one, that I don't hear people talk a lot about, but near and dear to my heart, being an operational guy, is the transactional nature of the over-the-road freight has shortened the length of contracts with customers, and there's more freight that's bid daily or monthly or quarterly. And it really becomes challenging, in an over-the-road fleet, to keep your network balance stable. We like to say, we run X amount of trucks from, you know, Chicago to Dallas, and Dallas to Chicago, and all different markets. That's become a challenge in the over-the-road arena of keeping your trucks balanced and your freight balanced, so that you can keep drivers moving and keep customers happy. If you have that stability of volume, it helps, but those transactional pieces change things a bit. CBJ: You mentioned the type of contracts that you do now are more short-bid contracts and less extended contracts. And that ties into a question about logistics. What's the future of CRST’s logistics business, and what will need to happen to make that a reality? Mr. Gannon: We started our logistics business in 2002, so that's evolved over time. We continue to invest in it. Probably the two biggest things are our Asset Light group based in Birmingham has seen tremendous growth with their agents. We've really put an effort into bringing them more capacity through brokerage. That business has more than doubled in the past 12 months with our agents, so that's growing rapidly. They do both flatbed and van, so they're able to serve more customers. The other thing we did was we pulled our logistics group into our asset over-the-road business. We're combining the freight network, so we can bring customers both that committed capacity of company-owned assets with the variable capacity of brokerage. We think we can serve customers and be more nimble to their needs. Take the tariff situation right now. We've got to be flexible, nimble to supply chains, and post-COVID, you really have to have a resilient solution to that customer. It stabilized post-COVID, but it was still up and down and up and down. So the logistics piece is one that we’re really leaning into and putting effort and investment into. We do have whole pieces of our business where the contracts are still longer in term, our dedicated (contracts are) typically three years-plus, and our home solutions and our specialized are at least a year-plus. So it's just in that over-the-road space where the contracts have become shorter. CBJ: You mentioned tariffs a bit. The impact of tariffs has yet to be fully realized, and the target just seems to be moving daily or weekly. What are your greatest concerns with tariffs? And do you think there's an opportunity to capitalize on those depending on how they're implemented? Mr. Gannon: The greatest concern is just what everybody else says – the unknown and the prolonged impact on supply chains from our customers. Nobody really knows. Are you going to ship products from Mexico to Vietnam? Are you going to ship products from China to Vietnam? Are boats going to get over here? It could be seasonal, but April is down not quite 2% over the first two weeks of March. Again, that could be a normal April. It could be the timing of Easter. It could be a lot of things. But we expect that to expand. We're hearing more and more that it's just going to get bumpy for the next month to two months, the foreseeable future, and then beyond that, I think it just matters how fast there's resolution to concrete tariff decisions. I can't even fathom what these customers are going through, trying to figure out their supply chains. It's got to be challenging for them. On the capitalization front, especially, the one we get excited about is more domestic manufacturing, especially in the steel and aluminum space. We're well-positioned with our flatbeds. We've got a large flatbed fleet, open deck fleet, and we're well-positioned to serve those needs. And then both our dedicated and home solutions have a wide footprint. They can both cover a lot of territory. And as people bring more into the country, or even just move more domestically, those are three areas where I think we're positioned well to capitalize. CBJ: Of course, some of those things don't happen overnight, either. Mr. Gannon: They don't. It’s going to take some time for that to happen. But you know, when you've been around 70 years, you ride the storm and you prepare for the long term, not the short term. CBJ: You're relatively new to your role as president and CEO, but as you've mentioned, you've been with the company for more than 41 years. What have been the biggest challenges in your new position? Mr. Gannon: I don't want to be trite, but the challenge is certainly the freight market we're in. But I haven't focused on that. I tell my girls all the time – attitude determines altitude, and I try to bring that to bear on the team here. We’re trying to shape our business for that nimbleness. Our focus has really been on elevating the customer. We serve the customer and the driver, but really, the customer comes first. What I’ve focused on is streamlining the business, aligning our resources with our revenues. You've noted our revenues are down, and we've had to be intentional about trucks, trailers, technology, terminals, talent, making sure they're right-sized to the business that we do have. And then we've moved more towards putting autonomy and decision-making in our five business units and their presidents, so they can move, they can invest, they can be more flexible to chart their own success and future. I've really focused on that in the first eight months here, and we're starting to see real progress there within each of the business units, refining how they go to market, how they structure their teams. I’m really excited about that. I've seen a lot in 40 – it's actually 42 years now. At some point, I tried to stop having birthdays. It's not a marketing pitch, but we're going to be here for the long term, and we're going to solve customer needs more than ever. I’m convinced we’ve got to be nimble to market demands. We ‘ve got to respond, pick up and deliver freight, but we've got to be flexible to an evolving supply chain, and that's where our focus is in shaping the future of CRST. CBJ: You're sitting in a relatively new headquarters building downtown. I believe the $37 million estimate is still accurate for when it opened in 2014. Mr. Gannon: I'm not privy to what John and Dyan and the family invested in it. (EDITOR’S NOTE: John Smith started with CRST in 1971 and held various roles in the organization, including president and CEO from 1987 to 2010). But I will tell you this. Young people always ask me, ‘why do you stay someplace 42 years?’ I couldn't be more proud of what John did in investing down here. We still have our southwest roots. Our original corporate headquarters is still on 16th Avenue SW. We've still got property all up and down 16th Avenue, and will remain there. But when the community needed it, when the flood happened, I just can't tell you how much John and Diane did to help this community. The city fathers and mothers came to John and said, ‘hey, we need some stimulus downtown.’ It probably wasn’t the easiest decision, but he and Diane went for it. It’s a beautiful building. Not all the floors are ours. We have great business partners here in the building. But that commitment to this community – Cedar Rapids is always going to be home to CRST. I am just so proud that we're such a part of the fabric. With some of the bigger companies making changes, we’ve become a bigger part of the fabric of Cedar Rapids. It's been a great community to us. And John being born and bred here – we’re never leaving Cedar Rapids. CBJ: To address that further, can you speak to why the company has decided to maintain that Cedar Rapids commitment, when it may have been just as easy to relocate somewhere else for easier property acquisition or lower cost or other factors? Mr. Gannon: This is our roots. The people we've employed here over the years, it’s just a great community to hire from within. I think we have above average talent available to us versus across the state. I grew up in Davenport, and I lived in Des Moines for a while, and I don't want to disparage any of those cities, but Cedar Rapids is pretty special. We've been blessed with a lot of great people here in the Cedar Rapids area. And John's and Diane’s commitment to this community. I talk to him about it all the time. He puts so much effort into making sure Cedar Rapids is vibrant. Since I started in 1983, his involvement has been apparent from day one. It’s important for the company to do well, but it's important for the company to be part of the community, for the community to do well, to John and Diane. That's why we've stayed. CBJ: Is there any thought of making CRST a publicly-owned company, and why or why not? Has that ever been a consideration? Mr. Gannon: Being privately held has served us well for 70 years, and there's no plans to go public. John likes the ability to think in the long term and not be pressured by market forces, to not have to answer to anybody but himself and the family and the employees and our customers. They just like it that way, and, and I don't see any change happen … John’s got a really long view on things, and he likes to be able to execute a strategy on his timeline, not somebody else's. Being privately held allows him to do that. CBJ: What do you see as the greatest opportunities for growth for CRST? Acquisitions, geographic expansion, or other avenues that are being explored? Mr. Gannon: A bit of a pivot, but our growth will be focused largely on being organic. We have three specific business units that we're investing the most of those assets and resources, and that's our Home Solutions, our Dedicated and our Asset Light businesses. Those are the ones that are growing or resilient to the market challenges we've talked about. They really have great opportunity. Home Solutions taking market share. Dedicated, we've just got a fantastic product offering there. We do some really cool stuff for people. And then our Asset Light brings over-the-road solutions that are the most nimble with both brokerage and independent contractors and an agent network. So we're investing in those three. We certainly will maintain and try to grow the other ones, but those three are where we tend to focus all our energies right now. I would say we're going to be less aggressive on the acquisition front than we have been in the past several years, and just focus on that organic growth and really investing in those businesses, bringing the team in and the people in to make those businesses go and grow. CBJ: Are there other other topics you want to address? Mr. Gannon: The challenges of the industry are going to be there, but we're in it for the long term, and we always have been. We're celebrating our 70th year later this year, and that [makes us] the second oldest trucking company around. And if you know this industry like I do, that's a feat that's pretty special, our ability to navigate challenges. Do I get concerned about market conditions? Sure, but we’re a company that’s always had the right moral, ethical, logical compass. That's what drives us, and that's what makes us great, and that's what will continue to serve us going forward. So we stay the course.

---

CRST details:

2024 Revenue: $1,536,300,000

Established: 1953

Top Executive: Mike Gannon, president and CEO

This article was originally published in the CBJ’s Largest Privately Held Companies special edition.