Renren Inc (NYSE:RENN) has disclosed that it has inked a deal with a view to acquiring Trucker Path at an undisclosed price. This marks the first time the Chinese company, which is listed on the NYSE, is diversifying into the transportation sector. Trucker Path is the trucking industry’s social platform in the U.S. and came into being six years ago. Currently the app has a monthly user base of more than 600,000 people which is about 33% of the longhaul truck drivers based in the United States.
“Currently, the two major emerging technology areas are artificial intelligence and blockchain. With the acquisition of the Trucker Path social platform and the Truckloads freight marketplace, the company will be well-positioned technologically to drive innovation within this important industry,” the chairman and chief executive officer of Renren, Joseph Chen, said.
Social media platform
Initially Renren was primarily a Chinese social media platform but lost out to WeChat and Weibo. Afterwards it diversified in new areas that included payments, logistics as well as hardware.
The acquisition of Trucker Path by Renren comes at a time when there is a growing shortage of drivers in the trucking industry in the United States. Despite close to 400,000 people obtain licenses to driver commercial vehicles across the United States, there is a high and constant turnover due to low pay and the nomadic life. According to trucking executives there is a desperate shortage of drivers needed to operate a fleet that exceeds four million class 8 vehicles (heavy freight trucks).
Per American Trucking Association’s chief economist, Bob Costello, there is an urgent need to increase pay for drivers in order to attract hires. Per Costello a lot of the current drivers are above 50 years and the shortage could increase to 174,000 drivers in the next seven years if nothing is done to help in the recruitment efforts.
Currently the annual compensation for a class 8 driver is an average of between $50,000 and $60,000 – the same amount these drivers were getting more than three decades ago.
On Wednesday shares of Renren Inc jumped by 47.39% to close the day at $18.32 a share.