Con-way Freight overhauls network, closes 40 service centers
LTL carrier says capacity reductions part of network improvements
By Dave Hannon -- Purchasing, 11/4/2008 8:49:00 PM
Con-way Freight, the less-than-truckload division of Con-way, announced this week it will close 40 service centers around the country as part of a network improvement initiative.
According to a statement from Con-way, under the new design, the freight from closing locations will be redistributed and balanced among more than 100 nearby service centers, with the company continuing to provide service to all markets.
“Consolidating volumes more strategically among fewer locations increases network density and enables improvements in both service performance and operational efficiency,” Con-way officials said. John G. Labrie, president of Con-way Freight, said in the statement, “We are simply balancing business volumes across a more strategic network footprint. It makes better use of available capacity and improves service with more efficient operations.”
But Con-way’s announcement is only the latest in a continuing flow of signs that indicate demand for trucking is on a steep decline. Last week, LTL giant YRC, parent to Yellow and Roadway, said it would lay off up to 3,750 workers. Earlier in the week Credit Suisse analyst Christopher J. Ceraso told the Associated Press that that freight demand should continue to weaken through 2009 and possibly fall for five more quarters. "This does not bode well for the less-than-truckload group as a whole, and YRC, in particular, has a track record of underperforming its peers operationally," he said.
And Purchasing.com reported last month that a host of trucking firms announced capacity reductions in the wake of slow third-quarter volumes.
See also: Truckers , analysts say peak season is not peaking
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