Derek Leathers : Yes. So there’s obviously going to be a lot of opportunity out there over the next 12 months. There’s a lot of folks looking for an exit, lot of its demographic based as much as anything. But what we’ve stated even in the prepared remarks, our focus right now because of doing 4 in 18 months, because of the early returns being as positive as they are on those 4, and because in each case, I think we’ve learned, we’ve gotten better and we’ve set ourselves up for even further success in the future. I want to see these things integrated. I want to see them all functioning as one. I want to make sure that our cross-selling capabilities are where they need to be. We just came out of our annual sales meeting that I was personally in attendance at, and meeting with all of the sales teams from each of the organizations.
And I think we’ve made large strides to what this looks like going forward. But there’s work to be done. So that’s — I guess my way of saying there’s nothing is off the table. We’re not — we’ve got room with the credit facility to be able to do more. We’ve got an open mind to look at opportunities as they become available. But in the meantime, our focus will be on integration on synergies and on execution.
Ken Hoexter: Thanks, Derek. And then maybe just a little bit — we’ve heard a lot of shifting in contracts, right? Everything used to be a yearlong when you talk contracts. I know your dedicated business, a little bit different multi-year, but if the retailers are now talking less than one year, what is your thoughts on the pricing paradigm in that market given your kind of mid-single-digit downtick on One-Way and slowing and Dedicated. What — how does that change the market dynamics in this environment?
Derek Leathers : Yes, great question. The — first off, I just want to point out the guidance we gave on One-Way is a first half guidance. So we believe it will end up being a tale of two halves, and we’re just not comfortable yet talking about the second half, so I think that’s important. As it relates to people going to shorter bid durations right now, I mean, normally, under almost every cycle, I can recall and every time frame, we’re always pushing for stability in our network over any short-term type pricing. But if somebody wants to price short right now, we’re going to be all ears. I mean, we’ll have that conversation because we have conviction that is things turning quicker than people realize. And I’d rather not be settle with that price for 12 months if 6 months will do.
So we’ll be open-minded. We’ll have those dialogues, and we’ll figure it out. We’re also going to hold people accountable just like they held us accountable and should hold us accountable to the agreements we made during COVID. The same thing is true now. If we have agreements in place, we’re going to look for that to hold up, and we’ll have those dialogues. And lastly, I’ll just point to something you mentioned in the question. So I know you know, but 63% of our businesses in TTS — and TTS is in that dedicated arena, and that is almost entirely made up of long-term contracts.
Ken Hoexter: But you did talk about decelerating pricing even on the Dedicated write-down, I guess, flattish, right, in terms of your pricing now?
John Steele: Flat to up 3% and that’s comping up against 7.6% that we achieved for revenue per truck increases in Dedicated in 2022.
Derek Leathers : Yes. I mean, not to be cheeky, but look, it is raining out there. Dedicated is a free darn good raincoat, but it’s still raining. So we’re going to have to perform. We’re going to have to execute in Dedicated, and we’re going to have to ask for what we feel is fair and appropriate. But it’s not going to be in the first half, the rate environment that we’ve seen over the last couple of years, and we hope to outperform that. But you know us, we’re going to be conservative with our guidance, and we’re going to try to make sure that what we put out there is achievable and exceed it where we can.
Ken Hoexter: Sounds good. Appreciate the time and thoughts. Thanks.
Operator: The next question is from Tom Wadewitz with UBS. Please go ahead.
Tom Wadewitz: Good afternoon. I know you’ve talked a bit about rates, but I wanted to see if you could offer just a thought on what we end up with in terms of the bid season and truckload contract rates. It seems like the comment in the first half down 3% to 6% is maybe not exactly what you think the rates could be. I mean, I guess if you think of the timing being that the contracts get implemented and partially 2Q more in 3Q, do we also expect that the rates would be down more in second half than that 3 to 6. So just, I guess, some commentary on kind of how to think about contract rates relative to the guidance?
Derek Leathers : Yes, sure. So first, let’s talk about what that cadence looks like. You really got kind of 60% of the revenues are done in the first two quarters, then 20% and 20% thereafter in Q3 and Q4. We’ve got a decent feel for Q1 implementations, and those are progressing. At this point, even just this point in Q1, our mindset is already starting to shift relative to how we think about rating business based on when we believe the turn is happening and the recent acceleration of some of these the deactivations we’ve been speaking of. So, we’re giving first half guidance. We think spot rates gone about as low as it can go, and it’s well below people’s operating cost. We’re fortunate that less than 5% of our revenues are in the spot market.
But we think that flush happens quicker than maybe it has in past cycles. So I mean that’s more color and context maybe than an exact answer. But certainly, I’m encouraged. Lastly, I’ll just tell you the comps in the first half are significantly tougher than the comps in the second half just based on how 2022 played out. So, that’s as much the issue as really anything.
