XPO names Brooks, private-fleet executive, to head its new LTL unit

XPO Logistics Inc. said today that it named Tony Brooks, a long-time trucking executive who has run several large private fleets, to head its less-than-truckload (LTL) unit, formerly known as Con-way Freight.

Brooks, 50, starts Nov. 11. He joins Greenwich, Conn.-based XPO from Sysco Corp., the Houston-based multinational food marketer and distributor, where he headed up North American field operations and ran Sysco's private fleet. Before that, Brooks ran private fleets at Dean Foods, the Dallas-based food giant, and at the Hoffman Estates, Ill.-based retailer Sears Holdings Corp. He was involved in regional private-fleet operations at Purchase, N.Y.-based PepsiCo/Frito-Lay, which is arguably the trucking industry's most successful private fleet. Brooks also spent 11 years as a driver and loader at the former LTL carrier Roadway Express, which was acquired in 2003 by what is now known as YRC Worldwide Inc.

In a phone interview tonight, Bradley S. Jacobs, XPO's chairman and CEO, said he wasn't specifically looking for a candidate from the private-fleet ranks. "We looked at both" the private-fleet and for-hire carrier segments, he said. Brooks was selected because of his executive leadership skills and deep experience in the field, Jacobs said. Brooks is a "bread-and-butter trucking guy, one of the best out there," Jacobs added.

Brooks will be running a $3.3 billion unit that accounted for more than half of the old Con-way Inc.'s $5.8 billion in annual revenue. XPO on Friday closed on its $3 billion purchase of Ann Arbor, Mich.-based Con-way. The Con-way name, as well as its Menlo Worldwide Logistics contract logistics unit, has been rebranded under the XPO banner.

In the interview, Jacobs said XPO continued to gradually position the LTL unit to penetrate the less-time-sensitive, nonpremium segment, an area the old Con-way Freight, whose strength was serving the next-day-to-second-day "premium" delivery category, wasn't much involved in; the so-called economy segment accounts for about three-quarters of all LTL business, according to XPO estimates. However, Jacobs said the migration will take about a year or two to fully complete, noting it will take time to put a network, technology, and support systems in place. "It cannot be done impulsively," he said.

The unit will also court third-party logistics (3PL) companies that specialize in LTL services, Jacobs said. This, too, was a market the old Con-way Freight did not focus on. Jacobs said that CEOs of three of the five top 3PLs whose business is directed at LTL will travel to Ann Arbor in two weeks to meet with him and other XPO executives. "We will grow this business," Jacobs said, adding that "we want their freight." He wouldn't name the companies that plan to visit.

Jacobs said that the former Con-way Truckload, which is now XPO's truckload unit, is holding its own in a soft market because 35 percent of its revenues come from cross-border U.S.-Mexican traffic, which is doing well. Jacobs confirmed last month that XPO had received three unsolicited offers to sell the unit.

The closing of the Con-way acquisition resulted in the layoffs on Friday of 250 out of a workforce out of about 30,000. The layoffs, which occurred at Ann Arbor and at a data center in Portland, Ore., cut about $30 million in expenses, according to Jacobs. At the time the deal was announced in September, XPO pledged to boost the old Con-way's operating profit by up to $420 million over the next two years. Most of that will come from cost-savings in areas like global procurement and rationalization of many back-office functions as well as I.T., he added.

Among those laid off were several top-level people at the parent and the LTL unit. Jacobs said he wasn't concerned about a "brain drain" as those executives take their knowledge, experience, and contacts elsewhere. "We've had a very strong and positive reaction from Con-way customers," he said in the interview.