YRC Worldwide Inc., in what is seen as an unusual attempt to attract new customers and retain its existing shipper base, is offering a $50-off coupon for each transaction generating $150 or more in freight charges.
The promotion, which runs until March 31, covers as many as 10 shipments, meaning shippers can earn up to $500 in discount coupons. Each coupon would be issued in the form of stickers that would be affixed to the "Special Instructions" section of the shipper's bill of lading, YRC said on its Web site. Each transaction must meet or exceed $150 in freight charges after any discounts, value-added charges known as "accessorials," and applicable fuel surcharges are factored in.
In a statement, YRC said "at any one time, promotions, offers, and sale initiatives are available for all customers, as a normal course of business." The company declined further comment.
The YRC promotion is the latest illustration of the lengths less-than-truckload (LTL) carriers will go to win and keep business in a market beset by soft demand, persistent overcapacity and aggressive rate-cutting. In the fall, FedEx Freight, one of YRC's chief rivals, rolled out a "90-for-90 program," which offered discounts of 90 percent off tariff rates for a 90-day period. It is believed the program is still in place.
Satish Jindel, president of SJ Consulting Group Inc., a Pittsburgh-based transport and logistics consultancy, says this is the first time he's seen a promotional offer like this in his 25 years in the industry. Jindel believes YRC, which survived a brush with bankruptcy on New Year's Eve by getting its bondholders to swap $530 million in debt for 1 billion newly issued equity shares, stands a decent chance of surviving in 2010 and beyond. However, he doubts a program like this will do much to drive profitable revenue.