Trucking giant YRC Worldwide lost $257.4 million in the first quarter as shipment volumes dropped at its carriers and throughout the less-than-truckload industry.
The nation’s largest LTL carrier and third-largest trucking operator by revenue saw operating revenue drop 32 percent to $1.5 billion from $2.2 billion a year ago.
The $257.4 million loss is a 5.1 percent increase from the fourth quarter 2008 loss of $244.4 million. YRC lost $46.4 million in the first quarter last year.
The $8.9 billion company lost $974.4 million in 2008 and $634.8 million in 2007.
Losses mounted despite YRC’s efforts to streamline operations, secure financing and lower labor costs, as shippers voted with their pallets, shifting freight to competitors.
Shipment volumes fell 29.5 percent at YRC National Transportation, the company’s long-haul division, and 22 percent at YRC Regional Transportation.
Total shipments at YRC National and YRC Regional dropped 28.3 percent and 20.1 percent, respectively, compared with a 2.2 percent drop at rival UPS Freight.
Total LTL revenue at UPS Freight fell 12.6 percent, compared with declines of 35.1 percent and 30.8 percent at YRC National and YRC Regional.
YRC Chairman, President and CEO William D. Zollars admitted some shippers had switched to competitors, at least temporarily.
“Our volumes were impacted by multiple factors, most notably the economy and business diversion due to customer anxiety surrounding the integration of Yellow and Roadway,” Zollars said.
He claimed some customers have returned, “but it is difficult to predict at what levels or how quickly the rest will come back.”
The company is rolling out a "Core Stimulus Package" to win customers back, with incentives for large, medium and small account as well as new cusotmers. Those incentives include a preferred pricing program, introductory discounts and a rewards program offering prepaid gift cards and even carbon offset rewards for shippers that meet predefined volume thresholds.
YRC made significant investments in its network in the first quarter, Zollars said, spending $65 million to integrate Yellow Transportation and Roadway.
It also tightened the network of regional carrier USF Holland, shedding terminals.
“Unfortunately, the economy progressively weakened throughout the quarter, making it more challenging to get ahead of the volume declines,” Zollars said.