Dealmaking declines across freight transportation sectors as investors wait out economic and trade uncertainty

A report recently issued by New York-based AlixPartners, a New York-based global consulting firm highlighted a third quarter decline in freight transportation M&A (mergers and acquisition) activity.

The report, entitled “Transport M&A Review: Q3 2025,” stated that quarterly deal volume, at 111, saw an 18% decrease compared to the second quarter, which was also slow, adding that on an annual basis Q3 deal volume was off 47% compared to the third quarter 2024.

“Freight transport M&A slows further as tariff uncertainty persists, anticipated rate cuts are delayed, and freight fundamentals now show a durable upward trend,” the report said.  

From a sector perspective, AlixPartners said that dealmaking was down across the board year-to-date, with ports and infrastructure deals down 8%, from the first quarter through the third quarter of 2025, with the report noting this sector “displayed the greatest resilience.” Logistics and transportation and shipping dealmaking saw declines of 41% and 47%, respectively, for the same period.

In terms of the key themes underpinning dealmaking activity, the report cited four key areas, including: market consolidation and control; geographic expansion; capability-driven acquisition; and supply chain localization. As ways in which stakeholders could leverage currently low valuations and also “future-proof businesses by seizing emerging capabilities, it cited: re-shoring, nearshoring, and regionalization; high-margin niches; inland and port-adjacent; and prioritizing speed

In an interview with LM, Marc Iampieri, global co-leader of the Logistics & Transportation practice, as well as partner and managing director, at AlixPartners, said that the report’s findings, in a way, have served as a proxy, of sorts, for freight transportation M&A activity over the better part of the last three years.

“It has never been this long; it has always been cyclical and snap back,” he said. “Things have been sideways for a while, outside of the Yellow bankruptcy and liquidation. The interest rate environment is challenging, relative to deals a couple of years ago that were easy to finance, and lenders have tighter terms now in comparison to when things were really booming, which was followed by the pandemic. And tariff uncertainty can have an acute negative impact or deposit impact, depending on where you provide your logistics services. That is why maybe there has been more money on the sidelines.”

But this is not a new situation, he added, as there have been periods in the past where there has been a lot of dealmaking in an industry that slows down, with that industry being tied to transactions in order for things to work. At the moment, he said things are coming back, albeit slowly, save for the proposed historic merger between Union Pacific and Norfolk Southern.

“There are some deals with strategic investors and some deals in the infrastructure space that don’t have a short time horizon,” he said. “Goods are going to continue to be imported into North America. So, you have to make sure the infrastructure at the marine terminal has the right cranes, material handling equipment, and the right labor deal. Those types of deals have weathered the storm better, but in a lot of other different sub-sectors of transportation, logistics, and the more commoditized-type of services, limited partners don’t want to invest their money into something that is kind of uncertain right now—and you also need to borrow at a higher interest rate, too. The exciting part is that pent-up demand eventually turns into something to talk about.”     

By and large, Iampieri explained that uncertainty is the biggest obstacle to a stable dealmaking environment, which could be addressed in various ways and influence how dealmaking decisions are made, including: actions taken by the next Federal Reserve Chair, in terms of policy and guidance on rate cuts; certainty related to tariff levels to create a more solid trade landscape; and consistent and stable inbound trade flows from Southeast Asia, Canada, and Mexico, among others.  

These types of actions, he said, reduce risk and uncertainty and help to spur spending activity, and, in turn, drive dealmaking activity, too.