Here’s a bit of my personal experience with one of Mr. Jacobs former companies, Waste Management.
So, I’m not exactly where I was in the cycle, but about 30 years ago when I moved into my current dwelling the garbage company (that’s what we called it) was something different, Allied Waste (maybe). Anyway, every truck had three guys, a driver and two guys that hung off the back of the truck. The two guys in back would jump off at every stop, pick up the cans at the curb and dump the garbage in the truck. Hop back on, and off to the next stop.
Later, they became Republic Services. But from my perspective not much else changed. Later still they kept the name, but all the trucks are now labeled “Waste Management.”
Not long after that a lot changed. They distributed uniform, wheeled bins to all their customers at very low monthly rates. But the big change was mainly the trucks and coincidentally, the labor requirements.
Soon all the trucks only had one guy on board, they’re equipped with “arms” that reach around the bins, pick them up and dump the garbage into the back of truck. All the trucks are powered by natural gas.
About those other two guys? Where I live we have three pick-ups. Land-fill bound garbage, recyclables and organics. So you could say they still have jobs, doing less arduous work and probably better pay. But actually, I don’t know how guys (all men) moved from the back of the truck to the front.
My point is, that took a lot of capital investment, not too sure the labor went down, my guess is they hired more folks to working at the recycling and composting plants (somebody did anyway).
Waste Management may not be a stellar growth company, but it’s a solid long term investment.
So, I’m no all that sure that changing capital deployment is a bad thing. If it helps XPO grow bigger, faster with increasing earnings it might be right thing. It might be worth keeping an eye on it again is all I’m really saying right now.