LTL giant folds regional operations

ANN ARBOR, Mich. — Abandoning an operations strategy it has been following since its inception 24 years ago, LTL powerhouse Con-way Freight announced it will combine all its regional operating arms into one centralized operation headquartered in Ann Arbor, Mich.

“This transformation will improve Con-way Freight’s performance by enabling us to anticipate and respond to customer needs more quickly and intelligently,” said John G. Labrie, president, Con-way Freight. “We are a great company that will become an extraordinary company by aligning and unifying management and processes around customers’ needs while improving our cost structure in an increasingly competitive LTL market.”

The company had operated under three units — Con-way Freight-Central, Con-way Freight-Southern and Con-way Freight-Western — since 1983.

Under the old model, each region had individual goals, practices and pricing models. The evolution into a new, centralized entity enables Con-way Freight to adopt uniform new processes and best practices designed to make the organization more responsive to the market and to customers throughout North America, the company said. The streamlined structure will reduce complexity, while the concurrent reductions in overhead will be leveraged into continuous improvement and innovation.

Costs for the reorganization are estimated to range from $12 million to $16 million and are expected to be incurred during the remainder of 2007 and the first quarter of 2008.

Meanwhile, the parent company recently announced Labrie as Con-way Freight’s new president.