ABF head: Company benefiting from “confusion” over new
FedEx Freight service
The president and CEO of Arkansas Best Corp., the parent
of less-than-truckload (LTL) carrier ABF Freight System
Inc., hinted that ABF has been taking market share from
FedEx Freight since the FedEx unit rolled out its revamped
service at the end of January.
Speaking at the Stifel, Nicolaus & Co. transportation and
logistics conference in Key Biscayne, Fla., Judy R.
McReynolds said ABF is “seeing an increased level of activity coming to us due to confusion” among FedEx Freight
customers about the operational changes there. She didn’t
disclose specifics about market share gains.
On Jan. 31, FedEx Freight, FedEx’s LTL unit, introduced
an integrated network that combines the unit’s regional and
national operations. The revamp includes a “priority” service with deliveries in two days or less, and an “economy”
service with deliveries in three days.
Ken Van Guilder, a FedEx Freight spokesman, dismissed
the notion that customers were dissatisfied with the new
operation. “Our integration has gone well, and customer
response has been positive,” he said.
For five years, Fort Smith, Ark.-based ABF has operated a
dual-system network for regional and long-haul deliveries.
ABF launched its regional network in March 2006 along the
Eastern Seaboard and expanded it in September 2008 to the
eastern two-thirds of the country. At press time, ABF was
poised to launch regional service in the western United
States, effectively completing a nationwide build-out of a
regional network to augment its national service.
McReynolds said 61 percent of ABF’s 2010 tonnage
moved in two days or less, with the remaining 39 percent
moving in three days or more on its national network. By
contrast, in 2005, only 30 percent of ABF’s freight was delivered in two days or less, she said.
McReynolds echoed comments made by other trucking
executives at the conference that LTL tonnage is increasing,
rate increases are sticking, and yields—measured in revenue per hundredweight—are rising. ABF implemented a
5.9-percent general rate increase at the beginning of
October, its second rate increase of 2010.
Through mid-February, ABF reported a 12.7-percent
year-over-year increase in tonnage, McReynolds said. The
increase would have been closer to 15 percent had it not
been for the impact of severe winter weather, she added.
—M.S.
Changes at YRC fuel speculation of CEO’s imminent departure
Is YRC Worldwide Inc. preparing its stakeholders for the imminent departure of its chairman and CEO, William D. Zollars?
Zollars was conspicuous by his absence from a Feb. 4 company press release announcing YRC’s fourth-quarter results.
Until now, Zollars had provided the commentary that
accompanies YRC’s quarterly financial communications. Instead, Sheila Taylor, YRC’s executive
vice president, CFO, and treasurer, was the executive quoted in the Feb. 4 statement.
In addition, Zollars’ name was not included
among the top YRC executives who circulated
an internal memo discussing the company’s
results the day the press release was issued. The
memo, distributed by YRC’s self-styled “senior
leadership team,” identified six top executives,
among them Taylor; Mike Smid, president of
YRC Inc. and COO of YRC Worldwide; and Greg Reid, executive vice president and chief marketing officer.
A YRC spokeswoman said “there is no significance” to
either development, noting that Zollars participated in a
recent analyst call and a separate video to discuss the company’s financial results. Zollars was also present at a Feb. 7
“town hall” meeting, where top management fielded
ZOLLARS
questions from employees.
But Ken Paff, national organizer for the Teamsters for a
Democratic Union (TDU), a dissident group, said unionized
Zollars’ departure has been the topic of speculation for some time. Last September, YRC and
the leadership of the Teamsters union, which represents about 25,000 YRC workers, struck a deal
calling for union members to make additional
wage and benefit concessions. In return, Zollars,
who has run YRC since 1999, would leave the
company once the financial restructuring was
completed and a new CEO was named. The rank
and file ratified the agreement in late October.
Labor sources said Zollars’ departure was a precondition
of the union’s acceptance of any contract proposals. The
company eventually announced that Zollars would retire
and that it was looking for a successor. Zollars, whose contract was up for renewal at the end of 2010, was expected
to stay until the restructuring is completed. However, there
is no firm deadline for that to happen.
