Industry Trends
- M&A activity in U.S. Transportation & Logistics in Q3 remained generally stable compared to 2024, with deal makers cautious amid macro and regulatory uncertainty but active where clear strategic fit existed.
- Investors prioritized strategic alignment over volume in Q3, with heightened focus on niche subsectors such as cold chain logistics, tech-enabled freight forwarding, and niche last-mile platforms.
- The proposed $85B merger between Union Pacific and Norfolk Southern was the sector’s standout headline for the quarter, signaling a potential transformation of the U.S. rail sector into a coast-to-coast operator while drawing significant antitrust and regulatory scrutiny.
Market Dynamics
- The Transportation & Logistics industry exhibited relatively consistent performance in EV/EBITDA multiples across segments in Q3 2025.
- Trade policy shifts, especially new tariffs on low-value imports like those on Chinese e-commerce shipments, are weighing on cross-border volume, while freight rates and volumes remain under pressure from falling global container demand. These factors have cooled excess demand and contributed to slower M&A momentum in Transportation & Logistics.
- In response to volatility from heightened geopolitical tensions, logistics providers accelerated nearshoring, supply chain diversification, and adoption of digital technologies. Focus has shifted toward resilience, efficiency, and scenario planning amid an increasingly complex operating environment.
- In Q3 2025, the Aviation sector demonstrated mixed but resilient performance. While global air cargo growth slowed (rising only marginally year-over-year), commercial passenger demand and select high-value cargo lanes continued to support volumes.
- Despite capacity expansion tempering pricing power, aviation providers maintained relative stability compared with other logistics segments, underscoring the role of diversified modal strategies in managing global supply chain volatility.
Sources: Capital IQ as of 09/30/2025. PwC, McKinsey & Company, Everstream Analytics
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Reach out to Dinan Capital Advisors Managing Director Tom Gerlacher for more report insights.