C.H. Robinson CEO says logistics business can weather Trump tariffs

As Dave Bozeman takes the stage at his first investor day as CEO of C.H. Robinson, he’ll have to contend with a freight recession, the threat of higher tariffs and the turnaround of a century-old logistics giant.

“I want to lay out our vision and that we actually already started executing,” Bozeman told CNBC in an exclusive interview ahead of the company’s investor day on Thursday. “We are going to grow market share, and we are going to expand our overall operating margins.”

On Thursday executives of the shipping company will present new financial targets, answer questions about its shift to a lean operating model, and provide an update on the business conditions, including the potential impact of President-elect Donald Trump’s proposed tariffs.

Trump has said he’ll impose 60% tariffs on goods from China and 25% tariffs on goods from Mexico and Canada. That could have a material impact on C.H. Robinson, which transports goods around the world for almost 100,000 clients.

C.H. Robinson’s main business segments include global forwarding, often referred to as freight brokerage between the U.S. and other regions; and North American surface transportation, which is primarily moving freight over land.

Analysts estimate C.H. Robinson is a top 3 carrier on the China-U.S. freight lane, and the company says it carries about 10% of the freight on the U.S.-Mexico lane.

“Some shippers will say, ‘We will take on that tariff.’ The economics of that volume will probably change in pricing and things like that. Either way we’re still going to move that freight,” Bozeman said. “The freight still has to move. It might just move at a different starting point, and we would still be there to move that.”

Citi transportation analyst Ari Rosa upgraded C.H. Robinson to a buy rating in November. He believes tariffs are creating a short-term pull forward of freight and agrees with Bozeman that, long term, the company has the ability to mitigate the impact of potential tariffs.

“There’s no question that their global forwarding business is very exposed to China,” Rosa told CNBC. “But I do think that their business is diversified enough that they can work through tariffs.”

Technology will also be in focus at Thursday’s investor day, including C.H. Robinson’s partnership with Microsoft and its use of Azure AI.

“We went in hard with AI. It’s a game changer for us and particularly for our scale,” Bozeman said, noting the partnership with Microsoft has been a major value add, but much of the work is done internally.

“Our engineers actually do the large language models. We are driving out 10,000 email quotes [per day] that are being deployed via large language models. I’ve been really pleased with the productivity that we have had using this technology,” Bozeman said.

“We’re able to get quotes back to customers in less than 2 minutes in a conversational manner,” he said. “It allows our people to now stay on solutioning and executing and solving things with our customers, versus spending time on menial tasks.”

This week, Wells Fargo analyst Christian Wetherbee upgraded C.H. Robinson stock in a note, writing in part: “We see a unique opportunity for earnings to compound through ’27, driven by improved execution (led by technology), which should lead to share gains and margin expansion.”

Key to all of Bozeman’s goals for C.H. Robinson is the shift to a new lean operating model, focused on continuous improvement and reducing activities and inefficiencies that do not add value to the enterprise or customer.

A lean model is relatively new to logistics. However, it is used at Amazon, Caterpillar and Ford — all companies where Bozeman has served as a top executive.

The shift has been well received. Shares of C.H. Robinson are up more than 25% this year, well outperforming the Dow Jones Transportation Average’s roughly 7% gain over the same period.

“I’m building a new company, a new culture,” said Bozeman. “It’s going to be a company that is an easy bet to invest in because it’s a market leader.”