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Con-Way cuts executive, board pay, 401(k) match

The Associated Press

SAN MATEO, Calif. (AP) — Trucking company Con-Way Inc. said Monday it has cut salaries for its chief executive and other top management by 10 percent and reduced other expenses in an effort to save as much as $130 million this year.

Con-Way also suspended its 401(k) match and reduced pay for all other executives and employees by 5 percent at Con-way Freight and Con-way Inc.. The company also lowered the annual retainer paid to non-employee members of the board by 10 percent and made changes to its defined benefit pension plan and vacation policies.

The changes are expected to be completed early in the second quarter. The measures are in addition to 2,500 layoffs, suspension of merit-based pay increases and other cuts implemented in the fourth quarter of 2008.

"These actions are designed to ensure we continue to maintain the strongest financial foundation possible during these unprecedented economic times," Chief Executive Douglas W. Stotlar said in a statement. Stotlar said the cuts will be reevaluated when the economy recovers.

Stotlar said tonnage at Con-way Freight declined 12.5 percent year-over-year through February. He said the market isn't expected to change soon and the company needs to control expenses to protect market share and conserve capital.

Con-way is a $5 billion freight transportation and logistics services company based in San Mateo, Calif., which operates 500 locations across North America and in 20 countries.

Shares fell 16 cents to close at $13.20. The stock traded last August at $55, but lost much of its value in the wake of the market meltdown last fall, recently bottoming at $12.99.