UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                     Washington, D.C. 20549

                            FORM 10-K
(Mark One)
 X   ANNUAL  REPORT  PURSUANT  TO  SECTION  13  OR 15(d) OF THE
---  SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2008

                               OR

     TRANSITION  REPORT PURSUANT  TO SECTION 13 OR 15(d) OF THE
---  SECURITIES EXCHANGE ACT OF 1934
For the transition period from ___________ to __________

                 Commission File Number 0-14690

                    WERNER ENTERPRISES, INC.
     (Exact name of registrant as specified in its charter)

NEBRASKA                                              47-0648386
(State or other jurisdiction of                 (I.R.S. Employer
incorporation or organization)               Identification No.)

14507 FRONTIER ROAD                                   68145-0308
POST OFFICE BOX 45308                                 (Zip code)
OMAHA, NEBRASKA
(Address of principal executive offices)

 Registrant's telephone number, including area code: (402) 895-6640

      Securities registered pursuant to Section 12(b) of the Act:
  Title of Each Class       Name of Each Exchange on Which Registered
  -------------------       -----------------------------------------
Common Stock, $.01 Par Value       The NASDAQ Stock Market LLC

   Securities registered pursuant to Section 12(g) of the Act:
                         Title of Class
                         --------------
                              NONE

Indicate by check mark if the registrant is a well-known seasoned
issuer,  as defined in Rule 405 of the Securities Act.
YES X NO
   ---  ---

Indicate by check mark if the registrant is not required to  file
reports pursuant to Section 13 or Section 15(d) of the Act.
YES   NO X
   ---  ---

Indicate  by check mark whether the registrant (1) has filed  all
reports  required  to be filed by Section  13  or  15(d)  of  the
Securities  Exchange Act of 1934 during the preceding  12  months
(or  for such shorter period that the registrant was required  to
file  such  reports),  and (2) has been subject  to  such  filing
requirements for the past 90 days.  YES X NO
                                       ---  ---

Indicate  by  check  mark  if  disclosure  of  delinquent  filers
pursuant  to Item 405 of Regulation S-K is not contained  herein,
and  will  not  be  contained, to the best  of  the  registrant's
knowledge,   in   definitive  proxy  or  information   statements
incorporated by reference in Part III of this Form  10-K  or  any
amendment to this Form 10-K.  X
                             ---

Indicate  by  check  mark  whether  the  registrant  is  a  large
accelerated  filer,  an accelerated filer, or  a  non-accelerated
filer (as defined in Rule 12b-2 of the Act).

Large accelerated filer X Accelerated filer   Non-accelerated filer
                       ---                 ---                     ---

Indicate by check mark whether the registrant is a shell  company
(as defined in Rule 12b-2 of the Act).   YES   NO X
                                            ---  ---
The  aggregate  market value of the common equity  held  by  non-
affiliates  of  the Registrant (assuming for these purposes  that
all  executive  officers and Directors are  "affiliates"  of  the
Registrant)  as of June 30, 2008, the last business  day  of  the
Registrant's  most recently completed second fiscal quarter,  was
approximately  $793 million (based on the closing sale  price  of
the  Registrant's  Common  Stock on  that  date  as  reported  by
Nasdaq).

As  of  February 17, 2009, 71,576,367 shares of the  registrant's
common stock were outstanding.

               DOCUMENTS INCORPORATED BY REFERENCE

Portions  of  the Proxy Statement of Registrant  for  the  Annual
Meeting of Stockholders to be held May 12, 2009, are incorporated
in Part III of this report.

<PAGE>

                        TABLE OF CONTENTS


                                                            Page
                                                            ----
                             PART I

Item 1.     Business                                          1
Item 1A.    Risk Factors                                      8
Item 1B.    Unresolved Staff Comments                        12
Item 2.     Properties                                       12
Item 3.     Legal Proceedings                                13
Item 4.     Submission of Matters to a Vote of Stockholders  14

                             PART II

Item 5.     Market for Registrant's Common Equity, Related
            Stockholder Matters and Issuer Purchases of
            Equity Securities                                15
Item 6.     Selected Financial Data                          17
Item 7.     Management's Discussion and Analysis of
            Financial Condition and Results of Operations    18
Item 7A.    Quantitative and Qualitative Disclosures about
            Market Risk                                      34
Item 8.     Financial Statements and Supplementary Data      35
Item 9.     Changes in and Disagreements with Accountants
            on Accounting and Financial Disclosure           54
Item 9A.    Controls and Procedures                          54
Item 9B.    Other Information                                56

                            PART III

Item 10.    Directors, Executive Officers and Corporate
            Governance                                       56
Item 11.    Executive Compensation                           57
Item 12.    Security Ownership of Certain Beneficial
            Owners and Management and Related Stockholder
            Matters                                          57
Item 13.    Certain Relationships and Related
            Transactions, and Director Independence          57
Item 14.    Principal Accounting Fees and Services           57

                             PART IV

Item 15.    Exhibits and Financial Statement Schedules       58


<PAGE>

     This  Annual Report on Form 10-K for the year ended December
31,  2008 ("Form 10-K") and the documents incorporated herein  by
reference   contain   forward-looking   statements    based    on
expectations, estimates and projections as of the  date  of  this
filing.    Actual  results  may  differ  materially  from   those
expressed  in  such  forward-looking  statements.   For   further
guidance,  see Item 1A of Part I and Item 7 of Part  II  of  this
Form 10-K.

                             PART I

ITEM 1.   BUSINESS

General

     We  are  a  transportation  and  logistics  company  engaged
primarily  in hauling truckload shipments of general  commodities
in  both  interstate and intrastate commerce.   We  also  provide
logistics  services  through  our Value  Added  Services  ("VAS")
division.   We are one of the five largest truckload carriers  in
the  United States (based on total operating revenues),  and  our
headquarters are located in Omaha, Nebraska, near the  geographic
center of our truckload service area.  We were founded in 1956 by
Clarence  L. Werner, who started the business with one  truck  at
the  age  of 19 and serves as our Chairman.  We were incorporated
in  the State of Nebraska on September 14, 1982 and completed our
initial  public offering in June 1986 with a fleet of 632  trucks
as  of February 28, 1986.  At the end of 2008, we had a fleet  of
7,700  trucks, of which 7,000 were owned by us and 700 were owned
and operated by independent owner-operator drivers.

     We  have  two reportable segments - Truckload Transportation
Services   ("Truckload")  and  VAS.   You  can   find   financial
information regarding these segments and the geographic areas  in
which  we conduct business in the Notes to Consolidated Financial
Statements under Item 8 of this Form 10-K.

     Our  Truckload  segment is comprised of  the  following  six
operating  fleets: (i) dedicated services ("Dedicated")  provides
truckload services required by a specific customer, generally for
a   distribution  center  or  manufacturing  facility;  (ii)  the
regional   short-haul  ("Regional")  fleet  provides   comparable
truckload  van service within five geographic regions across  the
United  States; (iii) the medium-to-long-haul van  ("Van")  fleet
transports  a variety of consumer nondurable products  and  other
commodities  in truckload quantities over irregular routes  using
dry van trailers; (iv) the expedited ("Expedited") fleet provides
time-sensitive truckload services utilizing driver teams; and the
(v)   flatbed   ("Flatbed")   and   (vi)   temperature-controlled
("Temperature-Controlled") fleets provide truckload services  for
products with specialized trailers.  Our Truckload fleets operate
throughout  the 48 contiguous U.S. states pursuant  to  operating
authority, both common and contract, granted by the United States
Department  of Transportation ("DOT") and pursuant to  intrastate
authority granted by various U.S. states.  We also have authority
to operate in several provinces of Canada and to provide through-
trailer  service  in and out of Mexico.  The principal  types  of
freight  we transport include retail store merchandise,  consumer
products, manufactured products and grocery products.   We  focus
on  transporting consumer nondurable products that generally ship
consistently throughout the year and whose volumes are  generally
more stable during a slowdown in the economy.

     Our  VAS  segment  is  a non-asset-based transportation  and
logistics  provider.   VAS is comprised  of  the  following  four
operating  units  that  provide  non-trucking  services  to   our
customers:  (i)  truck  brokerage  ("Brokerage");  (ii)   freight
management   (single-source  logistics)  ("Freight  Management");
(iii) intermodal ("Intermodal"); and (iv) Werner Global Logistics
("WGL"    or   "International").    Our   Brokerage   unit    had
transportation services contracts with over 6,400 carriers as  of
December  31,  2008.   Through our WGL  subsidiaries,  we  are  a
licensed U.S. Non-Vessel Operating Common Carrier ("NVOCC"), U.S.
Customs Broker, Class A Freight Forwarder in China, China  NVOCC,
U.S.   Transportation  Security  Administration  ("TSA")-approved
Indirect  Air Carrier and International Air Transport Association
("IATA") Accredited Cargo Agent.

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<PAGE>

Marketing and Operations

     Our  business  philosophy  is to  provide  superior  on-time
customer  service at a competitive cost.  To accomplish this,  we
operate premium modern tractors and trailers.  This equipment has
fewer  mechanical  and maintenance issues and helps  attract  and
retain   qualified   drivers.   We  have  continually   developed
technology to improve customer service and driver retention.   We
focus  on  shippers  who  value the  broad  geographic  coverage,
diversified  truck  and logistics services,  equipment  capacity,
technology, customized services and flexibility available from  a
large financially-stable carrier.

     We  operate in the truckload sector of the trucking industry
and  in the logistics sector of the transportation industry.  Our
Truckload  segment  provides specialized  services  to  customers
based  on (i) each customer's trailer needs (such as van, flatbed
and   temperature-controlled  trailers),  (ii)  geographic   area
(including  medium-to-long-haul throughout the contiguous  United
States, Mexico, Canada and regional areas), (iii) extremely time-
sensitive shipments (expedited) or (iv) the conversion  of  their
private  fleet  to  us (Dedicated).  In 2008,  trucking  revenues
accounted  for  86% of our total revenues, and  non-trucking  and
other  operating revenues (primarily VAS revenues) accounted  for
14%   of  our  total  revenues.   Our  VAS  segment  manages  the
transportation   and   logistics  requirements   for   individual
customers,   providing  customers  with  additional  sources   of
capacity, alternative modes of transportation, a global  delivery
network  and  systems analysis to optimize transportation  needs.
VAS   services   include  (i)  truck  brokerage,   (ii)   freight
management,  (iii)  intermodal transport and (iv)  international.
The  VAS  international services include (i) door-to-door freight
forwarding, (ii) vendor and purchase order management, (iii) full
container  load  consolidation  and  warehousing,  (iv)   customs
brokerage  and  (v) air freight services.  Most VAS international
services are provided throughout North America and Asia.  VAS  is
a  non-asset-based business that is highly dependent on qualified
employees,  information  systems and the  services  of  qualified
third-party  capacity  providers.   You  can  find  the  revenues
generated  by  services  accounting for  more  than  10%  of  our
consolidated revenues, consisting of Truckload and VAS,  for  the
last three years under Item 7 of this Form 10-K.

     We  have a diversified freight base but are dependent  on  a
group  of  customers for a significant portion  of  our  freight.
During  2008,  our  largest 5, 10, 25 and 50 customers  comprised
24%, 39%, 61% and 75% of our revenues, respectively.  No customer
exceeded 10% of revenues in 2008.  By industry group, our top  50
customers  consist  of  44%  retail and  consumer  products,  28%
grocery  products, 18% manufacturing/industrial and 10% logistics
and  other.  Many of our non-dedicated customer contracts may  be
terminated  upon  30  days'  notice, which  is  standard  in  the
trucking industry.  Most dedicated customer contracts are one  to
three  years in length and may be terminated upon 90 days' notice
following the expiration of the contract's first year.

     Virtually all of our company and owner-operator tractors are
equipped  with  satellite communication devices  manufactured  by
QualcommTM.  These devices enable us and our drivers  to  conduct
two-way  communication using standardized and freeform  messages.
This  satellite technology, installed in our trucks beginning  in
1992,  also allows us to plan and monitor shipment progress.   We
obtain  specific data on the location of all trucks in the  fleet
at  least  every  hour of every day.  Using  the  real-time  data
obtained  from the satellite devices, we have developed  advanced
application  systems  to  improve customer  and  driver  service.
Examples of such application systems include: (i) our proprietary
paperless  log  system  used  to electronically  pre-plan  driver
shipment  assignments based on real-time available driving  hours
and to automatically monitor truck movement and drivers' hours of
service; (ii) software that pre-plans shipments drivers can trade
enroute  to meet driver home-time needs without compromising  on-
time  delivery  schedules; (iii) automated "possible  late  load"
tracking  that  informs  the  operations  department  of   trucks
possibly   operating  behind  schedule,  allowing  us   to   take
preventive measures to avoid late deliveries; and (iv)  automated
engine  diagnostics  that  continually monitor  mechanical  fault
tolerances.   In  1998, we began a successful pilot  program  and
subsequently  became  the first trucking company  in  the  United
States  to  receive an exemption from the DOT  to  use  a  global
positioning  system-based paperless log system as an  alternative
to  the  paper  logbooks traditionally used by truck  drivers  to
track  their daily work activities.  On September 21,  2004,  the
Federal  Motor Carrier Safety Administration ("FMCSA") agency  of
the  DOT approved the exemption for our paperless log system  and

                                2
<PAGE>

moved  this  program  from the FMCSA-approved  pilot  program  to
exemption  status, requiring that the exemption be renewed  every
two  years.   On  September 7, 2006, the FMCSA announced  in  the
Federal  Register its decision to renew for two additional  years
our  exemption  from  the  FMCSA's requirement  that  drivers  of
commercial  motor  vehicles  operating  in  interstate   commerce
prepare handwritten records of duty status (logs).  In July 2008,
we  again  applied for the two-year renewal of our paperless  log
exemption.   On  January  9, 2009, the  FMCSA  announced  in  the
Federal Register its determination that our paperless log  system
satisfies   the  FMCSA's  Automatic  On-Board  Recording   Device
requirements and that an exemption is no longer required.

Seasonality

     In the trucking industry, revenues generally show a seasonal
pattern.   Peak freight demand has historically occurred  in  the
months  of September, October and November; however, we have  not
experienced  this  seasonal increase in demand  during  the  last
three  years.  After the December holiday season and  during  the
remaining winter months, our freight volumes are typically  lower
because  some  customers reduce shipment levels.   Our  operating
expenses  have historically been higher in the winter months  due
primarily  to decreased fuel efficiency, increased cold  weather-
related  maintenance  costs of revenue  equipment  and  increased
insurance  and claims costs attributed to adverse winter  weather
conditions.   We  attempt to minimize the impact  of  seasonality
through our marketing program by seeking additional freight  from
certain  customers during traditionally slower shipping  periods.
Revenue  can  also be affected by bad weather, holidays  and  the
number of business days during a quarterly period because revenue
is directly related to the available working days of shippers.

Employees and Owner-Operator Drivers

     As  of December  31, 2008, we employed 10,667 qualified  and
student drivers; 769 mechanics and maintenance personnel for  the
trucking  operation;  1,386  office personnel  for  the  trucking
operation;  and 704 personnel for VAS,  international  and  other
non-trucking operations.  We also had 700 service  contracts with
owner-operators who provide both a tractor and a qualified driver
or  drivers.  None of our U.S., Canadian or Chinese employees  is
represented  by  a collective bargaining unit,  and  we  consider
relations with all of our employees to be good.

     We  recognize  that our professional driver workforce is one
of our most valuable assets.  Most of our drivers are compensated
on a per-mile basis, using a standardized mileage pay scale.  For
most  company-employed  drivers,  the  rate  per  mile  generally
increases with the drivers' length of service.  Drivers may  earn
additional   compensation  through  a   mileage   bonus,   annual
achievement  bonus and for extra work associated with  their  job
(such  as loading and unloading, extra stops and shorter  mileage
trips).

     At  times,  there  are  driver  shortages  in  the  trucking
industry.   Availability of qualified drivers can be affected  by
(i) changes in the demographic composition of the workforce; (ii)
alternative  employment opportunities other  than  truck  driving
that  become  available  in  the economy;  and  (iii)  individual
drivers' desire to be home more often. The driver recruiting  and
retention  market has improved from a year ago.  The weakness  in
the  construction  and  automotive industries,  trucking  company
failures  and fleet reductions and a rising national unemployment
rate  continue  to positively affect our driver availability  and
selectivity.   In  addition, our strong mileage  utilization  and
financial  strength are attractive to drivers  when  compared  to
other carriers.  We anticipate that availability of drivers  will
remain  high  until  current economic conditions  improve.   When
economic  conditions improve, competition for  qualified  drivers
will  likely  increase  and we cannot  predict  whether  we  will
experience future driver shortages.  If such a shortage  were  to
occur  and a driver pay rate increase became necessary to attract
and retain drivers, our results of operations would be negatively
impacted  to  the  extent that we could not obtain  corresponding
freight rate increases.

                                3
<PAGE>

     We  utilize  student  drivers as a  primary  source  of  new
drivers.  Student drivers have completed a training program at  a
truck  driving school and are further trained by Werner certified
trainer drivers for approximately 300 driving hours prior to that
driver  becoming a solo driver with their own truck.  The student
driver  recruiting  environment  is  currently  good.   The  same
factors  described  above that have aided  our  qualified  driver
recruiting  efforts have also resulted in a plentiful  supply  of
student  drivers.  At the same time, some carriers are decreasing
the number of student drivers they recruit.  The availability  of
student drivers may be negatively impacted in the future  by  the
availability of financing for student loans for driving school, a
potential decrease in the number of driving schools, and proposed
rule  changes  regarding  minimum  requirements  for  entry-level
driver  training.  When  economic conditions improve, competition
for student drivers will likely increase, and we  cannot  predict
whether  we  will experience future shortages in the availability
of  student  drivers.    If such a shortage  were  to  occur  and
additional  driver pay rate increases were necessary  to  attract
student  drivers, our results of operations would  be  negatively
impacted  to the extent that corresponding freight rate increases
were not obtained.

     On  December  26,  2007,  the FMCSA published  a  Notice  of
Proposed  Rulemaking ("NPRM") in the Federal  Register  regarding
minimum  requirements for entry level driver training. Under  the
proposed  rule,  a commercial driver's license ("CDL")  applicant
would  be required to present a valid driver training certificate
obtained  from an accredited institution or program.  Entry-level
drivers  applying for a Class A CDL would be required to complete
a  minimum  of 120 hours of training, consisting of 76  classroom
hours  and  44  driving  hours. The current  regulations  do  not
require  a  minimum  number of training hours  and  require  only
classroom  education. Drivers who obtain their first  CDL  during
the  three-year period after the FMCSA issues a final rule  would
be  exempt. The FMCSA extended the NPRM comment period until July
2008.   On  April 9, 2008, the FMCSA published another NPRM  that
(i)  establishes  new minimum standards to be met  before  states
issue   commercial  learner's  permits;  (ii)  revises  the   CDL
knowledge and skills testing standards; and (iii) improves  anti-
fraud  measures within the CDL program.  If one or both of  these
proposed  rules  is  approved as written, the final  rules  could
materially  impact the number of potential new  drivers  entering
the  industry.   As  of  December 31, 2008,  the  FMCSA  has  not
published a final rule.

     We  also  recognize  that   owner-operators  complement  our
company-employed   drivers.   Owner-operators   are   independent
contractors who supply their own tractor and qualified driver and
are  responsible  for their operating expenses.   Because  owner-
operators  provide their own tractors, less financial capital  is
required  from us. Also, owner-operators provide us with  another
source  of  drivers to support our fleet.  We intend to  maintain
our emphasis on owner-operator recruiting, in addition to company
driver  recruitment.   We,  along  with  the  trucking  industry,
however,  continue to experience owner-operator  recruitment  and
retention difficulties that have persisted over the past  several
years.   Challenging operating conditions, including inflationary
cost  increases  that are the responsibility of  owner-operators,
higher  fuel  prices and tightened equipment financing  standards
have made it difficult to recruit and retain owner-operators.

Revenue Equipment

     As of  December 31, 2008, we operated 7,000 company tractors
and had contracts for 700 tractors owned by owner-operators.  The
company-owned  tractors  were  manufactured  by  Freightliner  (a
Daimler  company), Peterbilt and Kenworth (divisions  of  PACCAR)
and   International  (a  Navistar  company).   We  adhere  to   a
comprehensive maintenance program for both company-owned tractors
and  trailers.   We  inspect  owner-operator  tractors  prior  to
acceptance  for  compliance with Werner and DOT  operational  and
safety requirements.  We periodically inspect these tractors,  in
a  manner  similar  to  company tractor inspections,  to  monitor
continued  compliance.  We also regulate  the  vehicle  speed  of
company-owned trucks to a maximum of 65 miles per hour to improve
safety and fuel efficiency.

     The average age of our truck fleet was 1.3 years at December
31,  2006,  2.1  years  at December 31, 2007  and  2.5  years  at
December  31,  2008.  The higher average age of the  truck  fleet
results in more maintenance that is not covered by warranty.  The
average  odometer  miles per truck in our truck  fleet  has  also
increased  from  December 31, 2006 to  December  31,  2008.   The
percentage   increase  in  the  average  miles   per   truck   is
significantly  less than the percentage increase in  the  average

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age  due to the large pre-buy of new trucks in 2006.  The pre-buy
delayed  the purchase of more expensive trucks with 2007 engines.
The  pre-buy trucks were put into service throughout 2007  as  we
sold  our  used  trucks.  Based  on  current  used  truck  market
conditions,  we  may  be  unable  to  sell  enough used trucks to
maintain the current 2.5 year average  age of our company tractor
fleet.

     We  operated  24,940 trailers  at December 31,  2008.   This
total  is  comprised  of  23,316 dry vans;  473  flatbeds;  1,142
temperature-controlled  trailers;  and  9  specialized  trailers.
Most  of  our  trailers  were  manufactured  by  Wabash  National
Corporation.   As  of December 31, 2008, of our dry  van  trailer
fleet,  98% consisted of 53-foot trailers, and 100% was comprised
of  aluminum  plate or composite (DuraPlate) trailers.   We  also
provide  other  trailer  lengths, such  as  48-foot  and  57-foot
trailers, to meet the specialized needs of certain customers.

     Our  wholly-owned subsidiary, Fleet Truck Sales,  sells  our
used trucks and trailers and is believed to be one of the largest
domestic  Class  8  truck sales entities in  the  United  States.
Fleet  Truck Sales has been in business since 1992 and  currently
operates in 16 locations.

     The U.S. Environmental Protection Agency ("EPA") mandated  a
new  set  of  more stringent engine emissions standards  for  all
newly   manufactured  truck  engines.   These  standards   became
effective  in  January  2007.  Compared to  trucks  with  engines
manufactured  before 2007 and not subject to the  new  standards,
the trucks manufactured with the new engines have higher purchase
prices  (approximately $5,000 to $10,000  more  per  truck).   To
delay  the cost impact of these new emissions standards, in  2005
and  2006  we  purchased significantly more new  trucks  than  we
normally  buy  each year, and we maintained a newer  truck  fleet
relative to historical company and industry standards.  Our newer
truck fleet allowed us to delay purchases of trucks with the  new
2007-standard engines until first quarter 2008, when we began  to
take  delivery of trucks with 2007-standard engines.  In  January
2010,  a  final  set  of  more  rigorous  EPA-mandated  emissions
standards  will become effective for all new engines manufactured
after  that  date.   We  are  currently  evaluating  the  options
available to us to prepare for the upcoming 2010 standards.

Fuel

     We   purchase   approximately  96%   of  our  fuel  from   a
predetermined network of fuel stops throughout the United States.
We  negotiated  discounted pricing based on  historical  purchase
volumes  with  these  fuel stops.  Bulk  fueling  facilities  are
maintained  at  seven of our terminals and three Dedicated  fleet
locations.

     Shortages of fuel, increases in fuel prices and rationing of
petroleum  products  can have a material adverse  effect  on  our
operations  and  profitability.   Our  customer  fuel   surcharge
reimbursement  programs have historically enabled us  to  recover
from  our  customers a majority, but not all, of the higher  fuel
prices  compared to normalized average fuel prices.   These  fuel
surcharges,  which  automatically adjust depending  on  the  U.S.
Department of Energy ("DOE") weekly retail on-highway diesel fuel
prices, enable us to recoup much of the higher cost of fuel  when
prices  increase.  We do not generally recoup higher  fuel  costs
for miles not billable to customers, out-of-route miles and truck
engine   idling.   During  2008,  our  fuel  expense   and   fuel
reimbursements  to  owner-operators increased by  $117.2  million
because  of  higher fuel prices in the first half  of  the  year,
partially offset by fuel savings resulting from 6% fewer company-
owned tractors and the results of our initiatives to improve fuel
efficiency.  We cannot predict whether fuel prices will  increase
or  decrease in the future or the extent to which fuel surcharges
will  be  collected from customers.  As of December 31, 2008,  we
had no derivative financial instruments to reduce our exposure to
fuel price fluctuations.

     We  maintain aboveground  and underground fuel storage tanks
at  many of our terminals.  Leakage or damage to these facilities
could  expose us to environmental clean-up costs.  The tanks  are
routinely inspected to help prevent and detect such problems.

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<PAGE>

Regulation

     We are a motor carrier regulated by the DOT, the federal and
provincial Transportation Departments in Canada, the Secretary of
Communication  and  Transportation  ("SCT")  in  Mexico  and  the
Ministry  of Transportation in China.  The DOT generally  governs
matters  such as safety requirements, registration to  engage  in
motor  carrier  operations, accounting systems, certain  mergers,
consolidations and acquisitions and periodic financial reporting.
We  currently have a satisfactory DOT safety rating, which is the
highest  available  rating,  and  continually  take  efforts   to
maintain    our   satisfactory   rating.    A   conditional    or
unsatisfactory  DOT  safety  rating  could  adversely  affect  us
because  some  of our customer contracts require  a  satisfactory
rating.   Equipment  weight and dimensions are  also  subject  to
federal, state and international regulations.

     Effective  October  1, 2005, all truckload  carriers  became
subject to revised hours of service ("HOS") regulations issued by
the  FMCSA ("2005 HOS Regulations").  The most significant change
for us from the previous regulations is that now, pursuant to the
2005  HOS regulations, drivers using the sleeper berth must  take
at  least  one  break of eight consecutive hours off-duty  during
their  ten  hours off-duty.  Previously, drivers using a  sleeper
berth were allowed to split their ten-hour off-duty time into two
periods,  provided neither period was less than two  hours.   The
more  restrictive  sleeper berth regulations are  requiring  some
drivers to plan their time better.  The 2005 HOS Regulations also
had  a  negative impact on our mileage efficiency,  resulting  in
lower mileage productivity for those customers with multiple-stop
shipments or those shipments with pick-up or delivery delays.

     Effective  December 27, 2007, the FMCSA  issued  an  interim
final  rule  that amended the 2005 HOS regulations to  (i)  allow
drivers  up  to  11 hours of driving time within a 14-hour,  non-
extendable  window  from the start of the workday  (this  driving
time  must follow 10 consecutive hours of off-duty time) and (ii)
restart calculations of the weekly on-duty time limits after  the
driver  has at least 34 consecutive hours off duty.  This interim
rule made essentially no changes to the 11-hour driving limit and
34-hour restart rules that we have been following since the  2005
HOS  Regulations became effective.  In 2006 and  2007,  the  U.S.
Court of Appeals for the District of Columbia also considered the
2005 HOS Regulations and heard arguments on the various petitions
for  review,  one  of which was submitted by  Public  Citizen  (a
consumer  safety organization).  On January 23, 2008,  the  Court
denied  Public  Citizen's motion to invalidate the interim  final
rule.   The  FMCSA solicited comments on the interim  final  rule
until  February 15, 2008.  On November 19, 2008, the FMCSA issued
a  final  rule  which adopts the provisions of the December  2007
interim final rule.  This rule became effective January 19, 2009.

     On  January  18, 2007, the FMCSA published an  NPRM  in  the
Federal Register on the trucking industry's use of Electronic On-
Board  Recorders ("EOBRs") for compliance with  HOS  rules.   The
intent of this proposed rule is to (i) improve highway safety  by
fostering  development of new EOBR technology for HOS compliance;
(ii) encourage EOBR use by motor carriers through incentives; and
(iii)  require EOBR use by operators with serious and  continuing
HOS  compliance  problems.  Comments  on  the  NPRM  were  to  be
received  by  April  18, 2007.  On January 23,  2009,  the  FMCSA
withdrew the proposed rule for reconsideration.  While we do  not
believe the rule, as proposed, would have a significant effect on
our  operations  and profitability, we will continue  to  monitor
future developments.

     We  have unlimited authority to carry general commodities in
interstate commerce throughout the 48 contiguous U.S. states.  We
also have authority to carry freight on an intrastate basis in 43
states.  The Federal Aviation Administration Authorization Act of
1994 (the "FAAA Act") amended sections of the Interstate Commerce
Act to prevent states from regulating motor carrier rates, routes
or  service after January 1, 1995.  The FAAA Act did not  address
state   oversight   of   motor  carrier  safety   and   financial
responsibility or state taxation of transportation.  If a carrier
wishes  to  operate in intrastate commerce in a state  where  the
carrier did not previously have intrastate authority, the carrier
must, in most cases, still apply for authority in such state.

     WGL and its subsidiaries have obtained business licenses  to
operate  as  a U.S. NVOCC, U.S. Customs Broker, Class  A  Freight
Forwarder  in  China,  China  NVOCC,  TSA-approved  Indirect  Air
Carrier and IATA Accredited Cargo Agent.

                                6
<PAGE>

     With  respect  to  our activities in the air  transportation
industry,  we are subject to regulation by the TSA  of  the  U.S.
Department of Homeland Security as an Indirect Air Carrier and by
IATA   as  an  Accredited  Cargo  Agent.   IATA  is  a  voluntary
association  of  airlines  which  prescribes  certain   operating
procedures  for air freight forwarders acting as agents  for  its
members.   A  majority of our air freight forwarding business  is
conducted with airlines that are IATA members.

     We  are  licensed as a customs broker by Customs and  Border
Protection ("CBP") of the U.S. Department of Homeland Security in
each  U.S.  customs district in which we conduct  business.   All
U.S.  customs brokers are required to maintain prescribed records
and   are   subject  to  periodic  audits  by  CBP.    In   other
jurisdictions  in  which we perform clearance  services,  we  are
licensed by the appropriate governmental authority.

     We   are   also   registered  as  an  Ocean   Transportation
Intermediary  by  the  U.S. Federal Maritime Commission  ("FMC").
The  FMC  has  established  certain qualifications  for  shipping
agents,  including surety bonding requirements.  The FMC is  also
responsible  for  the  economic  regulation  of  NVOCC   activity
originating or terminating in the United States.  To comply  with
these  economic  regulations, vessel  operators  and  NVOCCs  are
required  to  electronically  file  tariffs,  and  these  tariffs
establish the rates charged for movement of specified commodities
into  and  out  of the United States.  The FMC may enforce  these
regulations by assessing penalties.

      Our  operations are subject to various federal,  state  and
local  environmental  laws and regulations,  many  of  which  are
implemented  by  the  EPA and similar state regulatory  agencies.
These  laws  and regulations govern the management  of  hazardous
wastes, the discharge of pollutants into the air and surface  and
underground waters and the disposal of certain substances.  We do
not believe that compliance with these regulations has a material
effect  on  our  capital expenditures, earnings  and  competitive
position.

     Several  U.S.  states,  counties  and  cities  have  enacted
legislation or ordinances restricting idling of trucks  to  short
periods of time.  This action is significant when it impacts  the
driver's ability to idle the truck for purposes of operating  air
conditioning  and  heating  systems  particularly  while  in  the
sleeper berth.  Many of the statutes or ordinances recognize  the
need of the drivers to have a comfortable environment in which to
sleep and include exceptions for those circumstances.  California
had  such  an  exemption; however, since  January  1,  2008,  the
California  sleeper berth exemption no longer  exists.   We  have
taken  steps  to address this issue in California, which  include
driver  training, better scheduling and the installation and  use
of  auxiliary power units ("APUs").  California has also  enacted
restrictions  on  transport refrigeration unit ("TRU")  emissions
that  require companies to operate compliant TRUs in  California.
The   California  regulations  apply  not  only   to   California
intrastate  carriers, but also to carriers outside of  California
who  wish  to enter the state with TRUs.  On January 9, 2009  the
EPA  issued California a waiver from preemption (as published  in
the   Federal  Register  on  January  16,  2009),  which  enables
California  to  phase  in  its  regulations  over  several  years
beginning  July  17,  2009.   For compliance  purposes,  we  have
started  the TRU registration process in California, and  we  are
currently  evaluating  our options and alternatives  for  meeting
these requirements in 2009 and over the next several years as the
regulations gradually become effective.

     Various  provisions  of   the   North  American  Free  Trade
Agreement  ("NAFTA")  may alter the competitive  environment  for
shipping  into and out of Mexico.  We believe we are sufficiently
prepared  to  respond  to the potential changes  in  cross-border
trucking  if  U.S. regulations on international trade  and  truck
transport  became  less restrictive with respect  to  the  border
shared by the United States and Mexico.  We conduct a substantial
amount of business in international freight shipments to and from
the United States and Mexico (see Note 8 (Segment Information) in
the  Notes to Consolidated Financial Statements under Item  8  of
this Form 10-K) and continue preparing for various scenarios that
may  result.  We believe we are one of the five largest truckload
carriers in terms of the volume of freight shipments to and  from
the United States and Mexico.

                                7
<PAGE>

Competition

     The  trucking industry  is highly competitive  and  includes
thousands of trucking companies.  The annual revenue of  domestic
trucking is estimated to be approximately $600 billion per  year.
We  have  a  small share (estimated at approximately 1%)  of  the
markets we target.  Our Truckload segment competes primarily with
other  truckload carriers. Logistics companies, railroads,  less-
than-truckload  carriers  and  private  carriers   also   provide
competition for both our Truckload and VAS segments.

     Competition  for the freight we transport is based primarily
on  service, efficiency, available capacity and, to some  degree,
on  freight  rates  alone.  We believe that few  other  truckload
carriers have greater financial resources, own more equipment  or
carry  a larger volume of freight than ours.  We are one  of  the
five  largest  carriers in the truckload transportation  industry
based on total operating revenues.

     The  significant industry-wide accelerated purchase  of  new
trucks in advance of the January 2007 EPA emissions standards for
newly  manufactured trucks contributed to excess truck  capacity.
The weakness in the housing and automotive sectors (each of which
is  not  principally served by us) caused carriers  dependent  on
these  freight  markets to aggressively compete in other  freight
markets  that we serve.  Weaker economic conditions in  the  last
four  months of 2008 resulted in customers shipping less freight,
which we believe increased price competition for freight.  During
the  same  period  in  which truckload freight  rates  have  been
depressed,  inflationary  and  operational  cost  pressures  have
challenged  truckload  carriers,  particularly  highly  leveraged
private  carriers.  In 2008, the industry experienced the highest
number  of  carrier  failures since 2001, which  we  believe  can
primarily  be attributed to higher diesel fuel prices during  the
first  half  of  2008.  If recent weaker economic conditions  and
tighter financing market conditions continue, additional trucking
company  failures  are  more likely, which  could  also  help  to
balance the supply of trucks relative to demand over time.

Internet Website

     We   maintain  an  Internet   website  where  you  can  find
additional  information  regarding our business  and  operations.
The  website address is www.werner.com.  On the website, we  make
certain  investor information available free of charge, including
our  annual report on Form 10-K, quarterly reports on Form  10-Q,
current  reports  on  Form  8-K, ownership  reports  filed  under
Section  16  of  the Securities Exchange Act of 1934  as  amended
("Exchange  Act")  and any amendments to such  reports  filed  or
furnished pursuant to Section 13(a) or 15(d) of the Exchange Act.
This information is included on our website as soon as reasonably
practicable   after  we  electronically  file  or  furnish   such
materials to the U.S. Securities and Exchange Commission ("SEC").
We also provide our corporate governance materials, such as Board
committee  charters  and our Code of Corporate  Conduct,  on  our
website  free  of  charge, and we may occasionally  update  these
materials when necessary to comply with SEC and NASDAQ  rules  or
to promote the effective and efficient governance of our company.

     Information provided  on our website is not incorporated  by
reference into this Form 10-K.

ITEM 1A.  RISK FACTORS

     The  following  risks and uncertainties may cause our actual
results,   business,  financial  condition  and  cash  flows   to
materially  differ from those anticipated in the  forward-looking
statements included in this Form 10-K.  Caution should  be  taken
not  to  place undue reliance on forward-looking statements  made
herein  because such statements speak only to the date they  were
made.  We  undertake  no  obligation  to  revise  or  update  any
forward-looking statements contained herein to reflect subsequent
events  or  circumstances  or  the  occurrence  of  unanticipated
events.  Also  refer  to  the Cautionary  Note Regarding Forward-
Looking Statements in Item 7 of Part II of this Form 10-K.

                                8
<PAGE>

Our business is subject to overall economic conditions that could
have a material adverse effect on our results of operations.
     We  are  sensitive to changes in overall economic conditions
that impact customer shipping volumes.  In 2008, the overall U.S.
economy  fluctuated and weakened in the last four months  of  the
year.   We  believe that our customers, and retailers  generally,
responded  to these financial market conditions by shipping  less
freight.  We also believe other factors that may have contributed
to  lower  customer shipping volumes and flat  to  lower  freight
rates  were (i) inventory tightening and reductions by  retailers
and  other  customers,  (ii)  excess  truck  capacity  and  (iii)
weakness in the retail, housing, and manufacturing sectors.  When
shipping   volumes  decline,  pricing  generally   becomes   more
competitive  as  carriers  compete for loads  to  maintain  truck
productivity.   We may be negatively affected by future  economic
conditions including employment levels, business conditions, fuel
and energy costs, interest rates and tax rates.

Increases  in  fuel  prices and shortages  of  fuel  can  have  a
material  adverse  effect  on  the  results  of  operations   and
profitability.
     Fuel prices in 2008 averaged 76 cents per gallon higher than
2007.   Prices  climbed in the first half of the  year  and  fell
during the last half of the year.  When fuel prices rise rapidly,
a  negative  earnings lag occurs because the cost of  fuel  rises
immediately  and  the  market  indexes  used  to  determine  fuel
surcharges increase at a slower pace.  This was the trend  during
the first half of 2008.  In a period of declining fuel prices, we
generally  experience  a  temporary  favorable  earnings   effect
because  fuel  costs  decline at a faster pace  than  the  market
indexes  used to determine fuel surcharge collections.  This  was
the trend during the second half of 2008 as fuel prices decreased
and  resulted  in  temporarily  lower  net  fuel  expense,  which
partially  offset uncompensated fuel costs resulting  from  truck
idling,  empty  miles not billable to customers and  out-of-route
miles.   If fuel prices remain stable or increase in the  future,
we do not expect the temporary favorable trend to continue.  Fuel
shortages,  increases  in  fuel  prices  and  petroleum   product
rationing  can  have a material adverse impact on our  operations
and  profitability.  We cannot predict whether fuel  prices  will
increase  or decrease in the future or the extent to  which  fuel
surcharges will be collected from customers.  To the extent  that
we  cannot recover the higher cost of fuel through customer  fuel
surcharges, our financial results would be negatively impacted.

Difficulty  in  recruiting and retaining  qualified  and  student
drivers   and  owner-operators  could  impact  our   results   of
operations and limit growth opportunities.
     At  times,  the  trucking  industry has  experienced  driver
shortages.   Driver  availability may  be  affected  by  changing
workforce  demographics and alternative employment  opportunities
in the economy.  However, recent weakness in the construction and
automotive  industries,  trucking  company  failures  and   fleet
reductions  and a rising national unemployment rate  continue  to
positively   affect  our  driver  availability  and  selectivity.
Consequently,  the  driver recruiting and  retention  market  has
improved  from  a year ago.  In addition, we believe  our  strong
mileage  utilization  and financial strength  are  attractive  to
drivers  when  compared to other carriers.   We  anticipate  that
availability  of drivers will remain high until current  economic
conditions   improve.    When   economic   conditions    improve,
competition  for qualified drivers will likely increase,  and  we
cannot   predict  whether  we  will  experience   future   driver
shortages.  If such a shortage were to occur and driver pay  rate
increases  were  necessary to attract  and  retain  drivers,  our
results of operations would be negatively impacted to the  extent
that we could not obtain corresponding freight rate increases.

We  operate  in  a highly competitive industry, which  may  limit
growth opportunities and reduce profitability.
     The  trucking  industry is highly competitive  and  includes
thousands  of  trucking companies.  We estimate the  ten  largest
truckload carriers have about 9% of the approximate $180  billion
U.S.  market we target.  This competition could limit our  growth
opportunities and reduce our profitability.  We compete primarily
with   other   truckload  carriers  in  our  Truckload   segment.
Logistics companies, railroads, less-than-truckload carriers  and
private  carriers also provide a lesser degree of competition  in
our   Truckload  segment,  but  such  carriers  are  more  direct
competitors in our VAS segment.  Competition for the  freight  we
transport  or manage is based primarily on service and efficiency
and, to some degree, on freight rates alone.

                                9
<PAGE>

We  operate in a highly regulated industry.  Changes in  existing
regulations or violations of existing or future regulations could
adversely affect our operations and profitability.
     We  are  regulated  by the DOT, the federal  and  provincial
Transportation Departments in Canada, the SCT in Mexico  and  the
Ministry of Transportation in China and may become subject to new
or more comprehensive regulations mandated by these agencies.  We
are  also  regulated by agencies in certain U.S.  states.   These
regulatory  agencies  have  the authority  and  power  to  govern
transportation-related  activities,  such  as  safety,  financial
reporting, authorization to conduct motor carrier operations  and
other matters.  The subsidiaries of WGL have business licenses to
operate  as  a U.S. NVOCC, U.S. Customs Broker, Class  A  Freight
Forwarder  in  China,  China  NVOCC,  TSA-approved  Indirect  Air
Carrier  and  IATA Accredited Cargo Agent.  The loss  of  any  of
these business licenses could adversely impact the operations  of
WGL.

     On  January  18, 2007, the FMCSA published an  NPRM  in  the
Federal  Register  on the trucking industry's use  of  EOBRs  for
compliance  with  HOS rules.  Comments on the  NPRM  were  to  be
received  by  April  18, 2007.  On January 23,  2009,  the  FMCSA
withdrew  the  proposed  rule  for reconsideration.   We  do  not
believe  the  rule, as proposed, would significantly  affect  our
operations  and  profitability, and we will continue  to  monitor
future developments.

     California  has enacted  restrictions on TRU emissions  that
require  companies to operate compliant TRUs in  California.   On
January  9,  2009  the  EPA  issued  California  a  waiver   from
preemption  (as published in the Federal Register on January  16,
2009), which enables California to phase in its regulations  over
several  years beginning July 17, 2009.  For compliance purposes,
we  have started the TRU registration process in California,  and
we  are  currently  evaluating our options and  alternatives  for
meeting  these  requirements in 2009 and over  the  next  several
years as the regulations gradually become effective.

     As  of  January 2007,  all newly manufactured truck  engines
must  comply  with  the  EPA's  more stringent  engine  emissions
standards.   Trucks  manufactured with the new  engines  produced
under these 2007 standards have higher purchase prices, are  less
fuel-efficient  and  result in increased  maintenance  costs.   A
final  set  of more rigorous EPA emissions standards will  become
effective  in  January 2010 and apply to all  new  truck  engines
manufactured after that date.  We are evaluating our  options  to
prepare for compliance with the 2010 standards, but we are unable
to predict at this time to what extent such standards will affect
us or what the impact will be.

The  seasonal  pattern  generally  experienced  in  the  trucking
industry  may  affect  our periodic results during  traditionally
slower shipping periods and winter months.
     In the trucking industry, revenues generally show a seasonal
pattern.   Peak freight demand has historically occurred  in  the
months  of September, October and November; however, we have  not
experienced  this  seasonal increase in demand  during  the  last
three  years.  After the December holiday season and  during  the
remaining winter months, our freight volumes are typically  lower
because  some  customers reduce shipment levels.   Our  operating
expenses have historically been higher in winter months primarily
due  to decreased fuel efficiency, increased cold weather-related
maintenance  costs  of revenue equipment and increased  insurance
and  claims  costs due to adverse winter weather conditions.   We
attempt   to  minimize  the  impact  of  seasonality  by  seeking
additional  freight  from certain customers during  traditionally
slower shipping periods.  Bad weather, holidays and the number of
business  days during a quarterly period can also affect  revenue
because revenue is directly related to the available working days
of shippers.

We  depend  on  key customers, the loss or financial  failure  of
which  may  have a material adverse effect on our operations  and
profitability.
     A  significant portion of our revenue is generated from  key
customers.  During 2008, our top 5, 10 and 25 customers accounted
for  24%,  39%  and 61% of revenues, respectively.   No  customer
exceeded  10% of our revenues in 2008,  and our largest  customer
accounted  for  6%  of  our  revenues  in  2008.  We  do not have
long-term  contractual  relationships   with  many  of  our   key
non-dedicated customers.  Our contractual relationships with  our
dedicated  customers are  typically one to  three years in length
and  may  be  terminated  upon  90  days'  notice  following  the
expiration  of  the contract's first year.  We cannot provide any
assurance  that key customer  relationships will  continue at the
same levels.  If a significant customer reduced or terminated our
services, it could have a material adverse effect on our business

                                10
<PAGE>

and  results of operations.  We  review our  customers' financial
condition  for  granting  credit,  monitor  changes in customers'
financial  conditions  on  an  ongoing  basis, review  individual
past-due  balances and  collection concerns  and maintain  credit
insurance  for some customer accounts.  However, a key customer's
financial   failure  may   negatively  affect   our  results   of
operations.

We  depend on the services of third-party capacity providers, the
availability  of which could affect our profitability  and  limit
growth in our VAS segment.
     Our  VAS  segment  is  highly  dependent  on the services of
third-party capacity providers, such as other truckload carriers,
less-than-truckload  carriers,   railroads,  ocean  carriers  and
airlines.   Many  of  those  providers  face  the  same  economic
challenges  as  us.  Continued  freight  demand  softness and the
temporary  increased  truck supply  caused by  the industry truck
pre-buy  made  it  somewhat  easier  to  find qualified truckload
capacity  to  meet  customer  freight  needs  for  our  Brokerage
operation  in 2007.  A  large number  of carrier failures in 2008
tightened  capacity  in the  first half  of 2008, making  it more
difficult  to  obtain  capacity  at  a comparable margin to prior
quarters.  However, in recent months capacity became more readily
available due to the weakened domestic economy.  If we are unable
to secure  the services of these  third-party capacity providers,
our results of operations could be adversely affected.

Our  earnings  could be reduced by increases  in  the  number  of
insurance claims, cost per claim, costs of insurance premiums  or
availability of insurance coverage.
     We  are  self-insured for a significant portion of liability
resulting from bodily injury, property damage, cargo and employee
workers'  compensation  and  health  benefit  claims.   This   is
supplemented  by premium-based insurance with licensed  insurance
companies  above  our  self-insurance  level  for  each  type  of
coverage.  To the extent we experience a significant increase  in
the  number  of  claims,  cost per claim or  costs  of  insurance
premiums  for  coverage in excess of our retention  amounts,  our
operating results would be negatively affected.  A portion of our
insurance  coverage  for the current and prior  policy  years  is
provided by insurance companies that are subsidiaries of American
International   Group,  Inc.  ("AIG").    These   AIG   insurance
subsidiaries   are   regulated   by   various   state   insurance
departments.   We do not currently believe that financial  issues
affecting AIG will impact our current or prior insurance coverage
or our ability to obtain coverage in the future.

Decreased  demand for our used revenue equipment could result  in
lower unit sales, resale values and gains on sales of assets.
     We  are  sensitive to changes in used equipment  prices  and
demand, especially with respect to tractors.  We have been in the
business of selling our company-owned trucks since 1992, when  we
formed our wholly-owned subsidiary Fleet Truck Sales.  We have 16
Fleet   Truck  Sales  locations  throughout  the  United  States.
Carrier failures and company fleet reductions have increased  the
supply  of  used  trucks for sale, while buyer  demand  for  used
trucks  is weak due to the soft freight market and a shortage  of
available financing.  Gains on sales of assets are reflected as a
reduction of other operating expenses in our income statement and
amounted to gains of $9.9 million in 2008, $22.9 million in  2007
and $28.4 million in 2006.  If these market and demand conditions
continue  or  deteriorate further, our gains on sales  of  assets
could be negatively affected.

Our  operations  are  subject to various environmental  laws  and
regulations,  the violation of which could result in  substantial
fines or penalties.
     In  addition to  direct regulation by the DOT, EPA and other
agencies,  we  are  subject  to various  environmental  laws  and
regulations  dealing  with the handling of  hazardous  materials,
underground  fuel  storage tanks and discharge and  retention  of
storm-water.   We  operate  in  industrial  areas,  where   truck
terminals  and other industrial activities are located and  where
groundwater  or  other forms of environmental contamination  have
occurred.   Our operations involve the risks of fuel spillage  or
seepage, environmental damage and hazardous waste disposal, among
others.   We  also maintain bulk fuel storage at several  of  our
facilities.   If  we  are involved in a spill or  other  accident
involving  hazardous substances, or if we  are  found  to  be  in
violation  of  applicable laws or regulations, it  could  have  a
material adverse effect on our business and operating results. If
we  fail to comply with applicable environmental regulations,  we
could  be subject to substantial fines or penalties and to  civil
and criminal liability.

                                11
<PAGE>

We rely on the services of key personnel, the loss of which could
impact our future success.
     We  are  highly  dependent on the services of key  personnel
including  Clarence L. Werner, Gary L. Werner, Gregory L.  Werner
and  other  executive officers.  Although we believe we  have  an
experienced  and highly qualified management group, the  loss  of
the  services of these executive officers could have  a  material
adverse impact on us and our future profitability.

Difficulty  in obtaining goods and services from our vendors  and
suppliers could adversely affect our business.
     We  are  dependent on our vendors and suppliers.  We believe
we  have good vendor relationships and that we are generally able
to  obtain  attractive pricing and other terms from  vendors  and
suppliers.   If  we  fail to maintain satisfactory  relationships
with  our  vendors and suppliers or if our vendors and  suppliers
experience  significant financial problems, we  could  experience
difficulty  in  obtaining needed goods and  services  because  of
production  interruptions  or other reasons.   Consequently,  our
business  could  be adversely affected.  One of  our  large  fuel
vendors declared bankruptcy in December 2008 and is continuing to
operate its fuel stop locations post-bankruptcy.  If this  vendor
were  to  reduce or eliminate truck stop locations in the future,
we  believe we have the ability to obtain fuel from other vendors
at a comparable price.

We   use  our  information  systems  extensively  for  day-to-day
operations, and service disruptions could have an adverse  impact
on our operations.
     The  efficient operation of our business is highly dependent
on  our  information systems.  Much of our software was developed
internally or by adapting purchased software applications to  our
needs.  We purchased redundant computer hardware systems and have
our  own  off-site  disaster recovery facility approximately  ten
miles  from our headquarters for use in the event of a  disaster.
We  took  these  steps to reduce the risk of  disruption  to  our
business operation if a disaster occurred.

ITEM 1B.  UNRESOLVED STAFF COMMENTS

     We  have  not received  any written comments from SEC  staff
regarding  our periodic or current reports that were  issued  180
days  or more preceding the end of our 2008 fiscal year and  that
remain unresolved.

ITEM 2.   PROPERTIES

     Our headquarters are located on approximately 197 acres near
U.S.  Interstate 80 west of Omaha, Nebraska, 107 acres  of  which
are  held for future expansion.  Our headquarters office building
includes  a  computer  center, drivers'  lounges,  cafeteria  and
company  store.   The Omaha headquarters also includes  a  driver
training  facility, equipment maintenance and  repair  facilities
and  a  sales office for selling used trucks and trailers.  These
maintenance  facilities contain a central parts warehouse,  frame
straightening  and  alignment machine,  truck  and  trailer  wash
areas,  equipment  safety  lanes, body  shops  for  tractors  and
trailers,  paint  booth  and  reclaim  center.   Our  headquarter
facilities  have suitable space available to accommodate  planned
needs for at least the next three to five years.

                                12
<PAGE>

     We also have several terminals throughout the United States,
consisting of office and/or maintenance facilities.  Our terminal
locations are described below:

<TABLE>
<CAPTION>

Location                  Owned or Leased   Description                           Segment
-----------------------   ---------------   -----------------------------------   -------------------------
<S>                       <C>               <C>                                   <C>
Omaha, Nebraska           Owned             Corporate headquarters, maintenance   Truckload, VAS, Corporate
Omaha, Nebraska           Owned             Disaster recovery, warehouse          Corporate
Phoenix, Arizona          Owned             Office, maintenance                   Truckload
Fontana, California       Owned             Office, maintenance                   Truckload
Denver, Colorado          Owned             Office, maintenance                   Truckload
Atlanta, Georgia          Owned             Office, maintenance                   Truckload, VAS
Indianapolis, Indiana     Leased            Office, maintenance                   Truckload
Springfield, Ohio         Owned             Office, maintenance                   Truckload
Allentown, Pennsylvania   Leased            Office, maintenance                   Truckload
Dallas, Texas             Owned             Office, maintenance                   Truckload, VAS
Laredo, Texas             Owned             Office, maintenance, transloading     Truckload, VAS
Lakeland, Florida         Leased            Office                                Truckload
El Paso, Texas            Owned             Office, maintenance                   Truckload
Ardmore, Oklahoma         Leased            Maintenance                           Truckload, VAS
Indianola, Mississippi    Leased            Maintenance                           Truckload, VAS
Scottsville, Kentucky     Leased            Maintenance                           Truckload, VAS
Fulton, Missouri          Leased            Maintenance                           Truckload, VAS
Tomah, Wisconsin          Leased            Maintenance                           Truckload
Newbern, Tennessee        Leased            Maintenance                           Truckload
Chicago, Illinois         Leased            Maintenance                           Truckload
Alachua, Florida          Leased            Maintenance                           Truckload, VAS
South Boston, Virginia    Leased            Maintenance                           Truckload, VAS
Garrett, Indiana          Leased            Maintenance                           Truckload

</TABLE>

     We currently lease (i) approximately 60 small sales offices,
Brokerage  offices and trailer parking yards in various locations
throughout  the  United States  and  (ii) office space in Mexico,
Canada  and China.  We  own (i) a  96-room motel located near our
Omaha  headquarters;  (ii)  a  71-room  private   driver  lodging
facility  at our  Dallas terminal; (iii) four  low-income housing
apartment  complexes in the Omaha area; (iv) a warehouse facility
in Omaha; and (v) a terminal facility in Queretaro, Mexico, which
we  lease  to  a  related  party  (see  Note  7  in  the Notes to
Consolidated  Financial  Statements  under  Item  8 of  this Form
10-K).  We  also  have  50% ownership  in  a 125,000  square-foot
warehouse  located  near our headquarters in  Omaha.   The  Fleet
Truck  Sales network currently has 16 locations, of which 13  are
located in our terminals listed above and 3 are leased.

ITEM 3.   LEGAL PROCEEDINGS

     We  are a party subject to routine litigation incidental  to
our  business,  primarily  involving claims  for  bodily  injury,
property damage, cargo and workers' compensation incurred in  the
transportation  of freight.  We have maintained a  self-insurance
program   with   a   qualified  department  of  risk   management
professionals  since  1988.  These employees  manage  our  bodily
injury,  property damage, cargo and workers' compensation claims.
An actuary reviews our self-insurance reserves for bodily injury,
property  damage  and  workers'  compensation  claims  every  six
months.

                                13
<PAGE>

     We  were  responsible for liability claims up  to  $500,000,
plus  administrative  expenses,  for  each  occurrence  involving
bodily  injury or property damage since August 1, 1992.  For  the
policy  year  beginning August 1, 2004, we  increased  our  self-
insured  retention ("SIR") and deductible amount to $2.0  million
per  occurrence.   We  are also responsible  for  varying  annual
aggregate  amounts  of  liability for claims  in  excess  of  the
SIR/deductible.  The following table reflects the  SIR/deductible
levels  and aggregate amounts of liability for bodily injury  and
property damage claims since August 1, 2005:

<TABLE>
<CAPTION>

                                                    Primary Coverage
        Coverage Period          Primary Coverage    SIR/Deductible
------------------------------   ----------------   ----------------
<S>                                <C>              <C>
August 1, 2005 - July 31, 2006     $5.0 million     $2.0 million (1)
August 1, 2006 - July 31, 2007     $5.0 million     $2.0 million (1)
August 1, 2007 - July 31, 2008     $5.0 million     $2.0 million (2)
August 1, 2008 - July 31, 2009     $5.0 million     $2.0 million (3)

</TABLE>

(1)  Subject to an additional $2.0 million aggregate in the $2.0
to  $3.0 million layer, no aggregate (meaning that we were fully
insured)  in the $3.0 to $5.0 million layer, and a $5.0  million
aggregate in the $5.0 to $10.0 million layer.

(2)  Subject to an additional $8.0 million aggregate in the $2.0
to  $5.0 million layer and a $5.0 million aggregate in the  $5.0
to $10.0 million layer.

(3)  Subject to an additional $8.0 million aggregate in the $2.0
to  $5.0 million layer and a $4.0 million aggregate in the  $5.0
to $10.0 million layer.

     We  are  responsible  for workers' compensation up  to  $1.0
million  per  claim.  Effective April 2007,  we  were  no  longer
responsible for the additional $1.0 million aggregate for  claims
between $1.0 million and $2.0 million.  We also maintain a  $26.3
million bond and have insurance for individual claims above  $1.0
million.

     Our  primary  insurance covers the range of liability  under
which  we  expect most claims to occur.  If any liability  claims
are  substantially in excess of coverage amounts  listed  in  the
table above, such claims are covered under premium-based policies
(issued  by  insurance  companies) to coverage  levels  that  our
management  considers  adequate.  We  are  also  responsible  for
administrative  expenses  for  each occurrence  involving  bodily
injury  or property damage.  See also Note 1 and Note  6  in  the
Notes  to Consolidated Financial Statements under Item 8 of  this
Form 10-K.

ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF STOCKHOLDERS

     During the fourth quarter of 2008, no matters were submitted
to a vote of stockholders.

                                14
<PAGE>

                             PART II

ITEM 5.   MARKET   FOR   REGISTRANT'S  COMMON   EQUITY,   RELATED
          STOCKHOLDER  MATTERS  AND ISSUER  PURCHASES  OF  EQUITY
          SECURITIES

Price Range of Common Stock

     Our common stock trades on the NASDAQ Global Select MarketSM
tier  of  the  NASDAQ Stock Market under the symbol "WERN".   The
following  table  sets  forth, for the  quarters  indicated  from
January  1, 2007 through December 31, 2008, (i) the high and  low
trade  prices per share of our common stock quoted on the  NASDAQ
Global Select MarketSM and (ii) our dividends declared per common
share.

<TABLE>
<CAPTION>

                                               Dividends
                                              Declared Per
                            High      Low     Common Share
                          -------   -------   ------------
         <S>              <C>       <C>          <C>
         2008
         Quarter ended:
           March 31       $ 20.51   $ 15.26      $ .050
           June 30          21.12     17.54        .050
           September 30     28.78     17.72        .050
           December 31      22.34     14.92       2.150

</TABLE>

<TABLE>
<CAPTION>

                                               Dividends
                                              Declared Per
                            High      Low     Common Share
                          -------   -------   ------------
         <S>              <C>       <C>          <C>
         2007
         Quarter ended:
           March 31       $ 20.92   $ 17.58      $ .045
           June 30          20.40     17.99        .050
           September 30     22.00     16.71        .050
           December 31      19.66     16.66        .050

</TABLE>

     As  of  February 17, 2009, our common stock was held by  190
stockholders  of  record.  Because many of our shares  of  common
stock  are  held by brokers and other institutions on  behalf  of
stockholders,  we  are unable to estimate  the  total  number  of
stockholders represented by these record holders.  The  high  and
low  trade  prices per share of our common stock  in  the  NASDAQ
Global  Select MarketSM as of February 17, 2009 were  $14.85  and
$14.19, respectively.

Dividend Policy

     We  have  paid cash dividends on our common stock  following
each  fiscal  quarter since the first payment in July  1987.   On
December  5, 2008, we also paid a special cash dividend of  $2.10
per  common share payable to stockholders of record at the  close
of  business  on November 21, 2008.  As a result of  the  special
dividend, a total of approximately $150.3 million was paid on our
71.6  million common shares outstanding.  We currently intend  to
continue  paying  dividends  on a  quarterly  basis  and  do  not
currently  anticipate any restrictions on our future  ability  to
pay  such  dividends. However, we cannot give any assurance  that
dividends  will be paid in the future because they are  dependent
on our earnings, financial condition and other factors.

                                15
<PAGE>

Equity Compensation Plan Information

     For  information on  our equity compensation  plans,  please
refer to Item 12 (Security Ownership of Certain Beneficial Owners
and Management and Related Stockholder Matters).

Performance Graph

         Comparison of Five-Year Cumulative Total Return

      The  following  graph  is  not  deemed  to  be  "soliciting
material"  or  to  be  "filed" with the SEC  or  subject  to  the
liabilities  of  Section 18 of the Exchange Act, and  the  report
shall  not  be  deemed to be incorporated by reference  into  any
prior or subsequent filing by us under the Securities Act of 1933
or  the Exchange Act except to the extent we specifically request
that such information be incorporated by reference or treated  as
soliciting material.

                [PERFORMANCE GRAPH APPEARS HERE]

<TABLE>
<CAPTION>

                                     12/31/03   12/31/04   12/31/05   12/31/06   12/31/07   12/31/08
                                     --------   --------   --------   --------   --------   --------
<S>                                   <C>        <C>        <C>        <C>        <C>        <C>
Werner Enterprises, Inc. (WERN)       $ 100      $ 117      $ 102      $  92      $  90      $ 105
Standard & Poor's 500                 $ 100      $ 111      $ 116      $ 135      $ 142      $  90
NASDAQ Trucking Group (SIC Code 42)   $ 100      $ 146      $ 144      $ 135      $ 128      $ 118

</TABLE>

     Assuming  the investment of $100.00 on December 31, 2003 and
reinvestment  of  all  dividends, the graph  above  compares  the
cumulative total stockholder return on our common stock  for  the
last  five  fiscal  years  with the cumulative  total  return  of
Standard  &  Poor's  500  Market Index  and  an  index  of  other
companies  included  in  the trucking industry  (NASDAQ  Trucking
Group - Standard Industrial Classification Code 42) over the same
period.   Our  stock  price was $17.34 as of December  31,  2008.
This  price was used for purposes of calculating the total return
on our common stock for the year ended December 31, 2008.

Purchases  of  Equity  Securities by the  Issuer  and  Affiliated
Purchasers

     On  October 15, 2007, we announced that on October 11,  2007
our  Board  of  Directors approved an increase in the  number  of
shares  of  our common stock that Werner Enterprises,  Inc.  (the
"Company")   is  authorized  to  repurchase.   Under   this   new
authorization,  the  Company  is  permitted  to   repurchase   an
additional  8,000,000  shares.  As  of  December  31,  2008,  the
Company   had  purchased  1,041,200  shares  pursuant   to   this
authorization  and had 6,958,800 shares remaining  available  for
repurchase.   The Company may purchase shares from time  to  time
depending   on   market,  economic  and   other   factors.    The
authorization  will continue unless withdrawn  by  the  Board  of
Directors.

                                16
<PAGE>

     No shares of common stock were repurchased during the fourth
quarter  of  2008  by  either  the  Company  or  any  "affiliated
purchaser," as defined by Rule 10b-18 of the Exchange Act.

ITEM 6.   SELECTED FINANCIAL DATA

     The  following selected  financial data should  be  read  in
conjunction with the consolidated financial statements and  notes
under Item 8 of this Form 10-K.

<TABLE>
<CAPTION>

(In thousands, except per share amounts)

                                                2008         2007         2006         2005         2004
                                             ----------   ----------   ----------   ----------   ----------
<S>                                          <C>          <C>          <C>          <C>          <C>
Operating revenues                           $2,165,599   $2,071,187   $2,080,555   $1,971,847   $1,678,043
Net income                                       67,580       75,357       98,643       98,534       87,310
Diluted earnings per share                          .94         1.02         1.25         1.22         1.08
Cash dividends declared per share                 2.300         .195         .175         .155         .130
Return on average stockholders' equity (1)          8.1%         8.8%        11.3%        12.1%        11.9%
Return on average total assets (2)                  5.0%         5.4%         7.1%         7.6%         7.5%
Operating ratio (consolidated) (3)                 94.8%        93.4%        92.1%        91.7%        91.6%
Book value per share (4)                          10.42        11.83        11.55        10.86         9.76
Total assets                                  1,275,318    1,321,408    1,478,173    1,385,762    1,225,775
Total debt                                       30,000            -      100,000       60,000            -
Stockholders' equity                            745,530      832,788      870,351      862,451      773,169

</TABLE>


(1)  Net income expressed as a percentage of average stockholders'
equity.   Return  on  equity  is  a  measure  of  a  corporation's
profitability relative to recorded shareholder investment.
(2)  Net income expressed as a percentage of average total assets.
Return  on  assets  is a measure of a corporation's  profitability
relative to recorded assets.
(3)  Operating  expenses  expressed as a percentage  of  operating
revenues.   Operating ratio is a common measure  in  the  trucking
industry used to evaluate profitability.
(4)  Stockholders' equity divided by common shares outstanding  as
of  the  end  of  the period.  Book value per share indicates  the
dollar value remaining for common shareholders if all assets  were
liquidated  at  recorded amounts and all debts were  paid  at  the
recorded amounts.

                                17
<PAGE>

ITEM 7.   MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OF   FINANCIAL
          CONDITION AND RESULTS OF OPERATIONS

     Management's Discussion and Analysis of Financial  Condition
and  Results  of  Operations ("MD&A")  summarizes  the  financial
statements  from  management's perspective with  respect  to  our
financial  condition, results of operations, liquidity and  other
factors that may affect actual results.  The MD&A is organized in
the following sections:

       * Cautionary Note Regarding Forward-Looking Statements
       * Overview
       * Results of Operations
       * Liquidity and Capital Resources
       * Contractual Obligations and Commercial Commitments
       * Off-Balance Sheet Arrangements
       * Critical Accounting Policies
       * Inflation

Cautionary Note Regarding Forward-Looking Statements:

     This   annual  report  on  Form  10-K  contains   historical
information  and forward-looking statements based on  information
currently  available  to  our  management.   The  forward-looking
statements in this report, including those made in this  Item  7,
(Management's Discussion and Analysis of Financial Condition  and
Results  of  Operations,) are made pursuant to  the  safe  harbor
provisions  of  the Private Securities Litigation Reform  Act  of
1995,   as  amended.   These  safe  harbor  provisions  encourage
reporting   companies  to  provide  prospective  information   to
investors.  Forward-looking statements can be identified  by  the
use   of   certain   words,  such  as  "anticipate,"   "believe,"
"estimate,"  "expect,"  "intend,"  "plan,"  "project"  and  other
similar  terms  and  language.   We believe  the  forward-looking
statements   are   reasonable  based   on   currently   available
information.  However, forward-looking statements involve  risks,
uncertainties  and assumptions, whether known  or  unknown,  that
could cause our actual results, business, financial condition and
cash  flows  to differ materially from those anticipated  in  the
forward-looking  statements.  A discussion of  important  factors
relating  to forward-looking statements is included in  Item  1A,
(Risk  Factors).  Readers should not unduly rely on the  forward-
looking  statements  included  in this  Form  10-K  because  such
statements  speak  only  to  the date  they  were  made.   Unless
otherwise required by applicable securities laws, we undertake no
obligation  or  duty  to  update or  revise  any  forward-looking
statements  contained  herein  to reflect  subsequent  events  or
circumstances or the occurrence of unanticipated events.

Overview:

     We  operate in the  truckload and logistics sectors  of  the
transportation industry.  In the truckload sector,  we  focus  on
transporting  consumer nondurable products  that  generally  ship
more  consistently throughout the year.  In the logistics sector,
besides   managing  transportation  requirements  for  individual
customers,  we  provide  additional sources  of  truck  capacity,
alternative  modes of transportation, a global  delivery  network
and  systems  analysis  to  optimize transportation  needs.   Our
success  depends  on  our  ability  to  efficiently  manage   our
resources  in  the  delivery  of  truckload  transportation   and
logistics services to our customers.  Resource requirements  vary
with customer demand, which may be subject to seasonal or general
economic conditions.  Our ability to adapt to changes in customer
transportation  requirements is essential to  efficiently  deploy
resources  and make capital investments in tractors and  trailers
(with  respect to  our  Truckload  segment) or  obtain  qualified
third-party  capacity at a reasonable  price (with respect to our
VAS  segment).   Although  our  business  volume  is  not  highly
concentrated, we may also be affected by our customers' financial
failures or loss of customer business.

     Operating   revenues  consist  of  (i)   trucking   revenues
generated  by  the six operating fleets in the Truckload  segment
(Dedicated, Regional, Van, Expedited, Temperature-Controlled  and
Flatbed)  and  (ii) non-trucking revenues generated primarily  by
the  four  operating  units within our  VAS  segment  (Brokerage,
Freight Management, Intermodal and International).  Our Truckload
segment  also  includes a small amount of non-trucking  revenues,

                                18
<PAGE>

consisting primarily of the portion of shipments delivered to  or
from  Mexico  where the Truckload segment utilizes a  third-party
capacity  provider.   Non-trucking  revenues  reported   in   the
operating  statistics table include those revenues  generated  by
the  VAS and Truckload segments.  Trucking revenues accounted for
86%  of  total  operating revenues in 2008, and non-trucking  and
other operating revenues accounted for 14%.

     Trucking  services typically generate revenues on a per-mile
basis.    Other   sources  of  trucking  revenues  include   fuel
surcharges  and  accessorial  revenues  (such  as  stop  charges,
loading/unloading  charges  and  equipment  detention   charges).
Because  fuel surcharge revenues fluctuate in response to changes
in  fuel  costs, these revenues are identified separately  within
the   operating  statistics  table  and  are  excluded  from  the
statistics  to  provide  a  more  meaningful  comparison  between
periods.   The non-trucking revenues in the operating  statistics
table include such revenues generated by a fleet whose operations
fall  within  the Truckload segment.  We do this so that  we  can
calculate  the  revenue  statistics in the  operating  statistics
table  using  only  the  revenue generated  by  company-owned and
owner-operator  trucks.  The  key  statistics  used  to  evaluate
trucking  revenues  (excluding  fuel surcharges)  are (i) average
revenues  per  tractor  per  week, (ii) per-mile rates charged to
customers,  (iii)  average  monthly  miles generated per tractor,
(iv)  average  percentage of  empty miles  (miles without trailer
cargo),  (v) average  trip  length  (in  loaded  miles)  and (vi)
average  number   of  tractors   in  service.   General  economic
conditions,  seasonal  trucking  industry  freight  patterns  and
industry  capacity  are  important  factors   that  impact  these
statistics.

     Our  most  significant  resource  requirements  are  company
drivers,   owner-operators,  tractors,  trailers  and   equipment
operating costs (such as fuel and related fuel taxes, driver pay,
insurance and supplies and maintenance).  To mitigate our risk to
fuel  price increases, we recover additional fuel surcharges from
our  customers  that  recoup a majority,  but  not  all,  of  the
increased fuel costs; however, we cannot assure you that  current
recovery  levels will continue in future periods.  Our  financial
results  are  also affected by company driver and  owner-operator
availability  and the market for new and used revenue  equipment.
We  are  self-insured for a significant portion of bodily injury,
property  damage and cargo claims, workers' compensation benefits
and  health  claims for our employees (supplemented  by  premium-
based insurance coverage above certain dollar levels).  For  that
reason,  our  financial results may also be  affected  by  driver
safety, medical costs, weather, legal and regulatory environments
and  insurance  coverage  costs to protect  against  catastrophic
losses.

     The  operating  ratio is a  common industry measure used  to
evaluate  our  profitability and that of  our  Truckload  segment
operating  fleets.   The  operating ratio consists  of  operating
expenses  expressed as a percentage of operating  revenues.   The
most  significant  variable expenses that  impact  the  Truckload
segment  are  driver  salaries and  benefits,  fuel,  fuel  taxes
(included  in  taxes  and licenses expense), payments  to  owner-
operators   (included   in  rent  and  purchased   transportation
expense),  supplies  and maintenance and  insurance  and  claims.
These  expenses  generally vary based  on  the  number  of  miles
generated.  We also evaluate these costs on a per-mile  basis  to
adjust  for  the  impact  on the percentage  of  total  operating
revenues  caused by changes in fuel surcharge revenues,  per-mile
rates  charged  to  customers  and  non-trucking  revenues.    As
discussed further in the comparison of operating results for 2008
to  2007,  several  industry-wide issues  could  cause  costs  to
increase in 2009.  These issues include a softer freight  market,
changing  fuel  prices, higher new truck purchase  prices  and  a
weaker  used  equipment  market.  Our main  fixed  costs  include
depreciation  expense  for tractors and  trailers  and  equipment
licensing  fees  (included in taxes and licenses  expense).   The
Truckload  segment  requires substantial  cash  expenditures  for
tractor and trailer purchases.  We fund these purchases with  net
cash  from operations and financing available under our  existing
credit facilities, as management deems necessary.

     We  provide non-trucking services primarily through the four
operating  units  within our VAS segment.  Unlike  our  Truckload
segment,  the VAS segment is less asset-intensive and is  instead
dependent  upon  qualified  employees,  information  systems  and
qualified  third-party capacity providers.  The  largest  expense
item  related  to  the  VAS  segment is  the  cost  of  purchased
transportation  we pay to third-party capacity  providers.   This
expense  item  is  recorded as rent and purchased  transportation
expense.   Other operating expenses include salaries,  wages  and
benefits  and  computer hardware and software  depreciation.   We
evaluate  VAS by reviewing the gross margin percentage  (revenues
less  rent and purchased transportation expenses expressed  as  a
percentage of revenues) and the operating income percentage.

                                19
<PAGE>

Results of Operations:

     The  following  table  sets  forth  certain  industry   data
regarding  our  freight revenues and operations for  the  periods
indicated.

<TABLE>
<CAPTION>

                                   2008          2007          2006          2005          2004
                               -----------   -----------   -----------   -----------   -----------
<S>                            <C>           <C>           <C>           <C>           <C>
Trucking revenues, net of
  fuel surcharge (1)           $ 1,430,560   $ 1,483,164   $ 1,502,827   $ 1,493,826   $ 1,378,705
Trucking fuel surcharge
  revenues (1)                     442,614       301,789       286,843       235,690       114,135
Non-trucking revenues,
  including VAS (1)                273,896       268,388       277,181       230,863       175,490
Other operating revenues (1)        18,529        17,846        13,704        11,468         9,713
                               -----------   -----------   -----------   -----------   -----------
  Operating revenues (1)       $ 2,165,599   $ 2,071,187   $ 2,080,555   $ 1,971,847   $ 1,678,043
                               ===========   ===========   ===========   ===========   ===========

Operating ratio
  (consolidated) (2)                  94.8%         93.4%         92.1%         91.7%         91.6%
Average revenues per tractor
  per week (3)                 $     3,427   $     3,341   $     3,300   $     3,286   $     3,136
Average annual miles per
  tractor                          121,974       118,656       117,072       120,912       121,644
Average annual trips per
  tractor                              197           184           175           187           185
Average trip length in
  miles (loaded)                       538           558           581           568           583
Total miles (loaded and
  empty) (1)                       979,211     1,012,964     1,025,129     1,057,062     1,028,458
Average revenues per total
  mile (3)                     $     1.461   $     1.464   $     1.466   $     1.413   $     1.341
Average revenues per loaded
  mile (3)                     $     1.686   $     1.692   $     1.686   $     1.609   $     1.511
Average percentage of empty
  miles (4)                           13.3%         13.5%         13.1%         12.2%         11.3%
Average tractors in service          8,028         8,537         8,757         8,742         8,455
Total tractors (at year end):
   Company                           7,000         7,470         8,180         7,920         7,675
   Owner-operator                      700           780           820           830           925
                               -----------   -----------   -----------   -----------   -----------
      Total tractors                 7,700         8,250         9,000         8,750         8,600
                               ===========   ===========   ===========   ===========   ===========

Total trailers (Truckload and
  Intermodal, at year end)          24,940        24,855        25,200        25,210        23,540
                               ===========   ===========   ===========   ===========   ===========

</TABLE>

(1) Amounts in thousands.
(2)  Operating expenses expressed as a percentage  of  operating
revenues.   Operating ratio is a common measure in the  trucking
industry used to evaluate profitability.
(3) Net of fuel surcharge revenues.
(4) Miles without trailer cargo.

     The  following  table  sets forth  the  revenues,  operating
expenses   and  operating  income  for  the  Truckload   segment.
Revenues  for the Truckload segment include non-trucking revenues
of  $8.6 million in 2008, $10.0 million in 2007 and $11.2 million
in 2006, as described on page 18.

<TABLE>
<CAPTION>

                                                              2008               2007               2006
                                                       -----------------  -----------------  -----------------
Truckload Transportation Services (amounts in 000's)       $         %        $         %        $         %
----------------------------------------------------   -----------------  -----------------  -----------------
<S>                                                    <C>         <C>    <C>         <C>    <C>         <C>
Revenues                                               $1,881,803  100.0  $1,795,227  100.0  $1,801,090  100.0
Operating expenses                                      1,786,789   95.0   1,673,619   93.2   1,644,581   91.3
                                                       ----------         ----------         ----------
Operating income                                       $   95,014    5.0  $  121,608    6.8  $  156,509    8.7
                                                       ==========         ==========         ==========

</TABLE>

                                20
<PAGE>

     Higher  fuel  prices  and higher fuel surcharge  collections
increase  our  consolidated  operating  ratio  and  the Truckload
segment's operating ratio when fuel surcharges are reported on  a
gross  basis  as revenues  versus netting  against fuel expenses.
Eliminating  fuel surcharge revenues,  which are generally a more
volatile source of revenue, provides a more consistent basis  for
comparing  the results of  operations from period to period.  The
following  table calculates  the  Truckload  segment's  operating
ratio as if fuel surcharges are excluded from revenue and instead
reported as a reduction of operating expenses.

<TABLE>
<CAPTION>

                                                              2008               2007               2006
                                                       -----------------  -----------------  -----------------
Truckload Transportation Services (amounts in 000's)       $         %        $         %        $         %
----------------------------------------------------   -----------------  -----------------  -----------------
<S>                                                    <C>                <C>                <C>
Revenues                                               $1,881,803         $1,795,227         $1,801,090
Less: trucking fuel surcharge revenues                    442,614            301,789            286,843
                                                       ----------         ----------         ----------
Revenues, net of fuel surcharges                        1,439,189  100.0   1,493,438  100.0   1,514,247  100.0
                                                       ----------         ----------         ----------
Operating expenses                                      1,786,789          1,673,619          1,644,581
Less: trucking fuel surcharge revenues                    442,614            301,789            286,843
                                                       ----------         ----------         ----------
Operating expenses, net of fuel surcharges              1,344,175   93.4   1,371,830   91.9   1,357,738   89.7
                                                       ----------         ----------         ----------
Operating income                                       $   95,014    6.6  $  121,608    8.1  $  156,509   10.3
                                                       ==========         ==========         ==========

</TABLE>

     The  following  table  sets  forth the  VAS  segment's  non-
trucking  revenues,  rent  and purchased transportation  expense,
other  operating expenses and operating income.  Other  operating
expenses for the VAS segment primarily consist of salaries, wages
and benefits expense.  VAS also incurs smaller expense amounts in
the  supplies  and maintenance, depreciation, rent and  purchased
transportation  (excluding  third-party  transportation   costs),
insurance,  communications  and  utilities  and  other  operating
expense categories.

<TABLE>
<CAPTION>

                                                              2008               2007               2006
                                                       -----------------  -----------------  -----------------
Value Added Services (amounts in 000's)                    $         %        $         %        $         %
---------------------------------------                -----------------  -----------------  -----------------
<S>                                                    <C>                <C>                <C>
Revenues                                               $  265,262  100.0  $  258,433  100.0  $  265,968  100.0
Rent and purchased transportation expense                 225,498   85.0     224,667   86.9     240,800   90.5
                                                       ----------         ----------         ----------
Gross margin                                               39,764   15.0      33,766   13.1      25,168    9.5
Other operating expenses                                   25,194    9.5      21,348    8.3      17,747    6.7
                                                       ----------         ----------         ----------
Operating income                                       $   14,570    5.5  $   12,418    4.8  $    7,421    2.8
                                                       ==========         ==========         ==========

</TABLE>

2008 Compared to 2007
---------------------

Operating Revenues

     Operating  revenues increased 4.6% in 2008 compared to 2007.
Excluding  fuel  surcharge revenues, trucking revenues  decreased
3.5%  due  primarily to a 6.0% decrease in the average number  of
tractors  in  service  (as  discussed further  below),  partially
offset by a 2.8% increase in average annual miles per tractor.

     The  truckload freight  market, as  measured  by our overall
pre-booked  percentage  of  loads  to  trucks  ("pre-books"), was
softer during most of 2008 compared to 2007.  Freight demand  was
lower  the first  five months  of 2008 compared to the first five
months  of  2007.  In  June  2008, freight  volumes  improved and
exceeded  those of June  2007 but were  approximately the same in
third quarter 2008 compared to third quarter 2007.  During fourth
quarter  2008,  freight volumes declined and  were  significantly
lower than fourth quarter 2007.

     The  industry-wide  accelerated purchase of  new  trucks  in
advance of the 2007 EPA engine emissions standards contributed to
excess  truck  capacity that partially disrupted the  supply  and
demand balance during early 2008.  These excess trucks along with
a  weakening economy resulted in lower freight volumes during the
first  five  months  of  2008  compared  to  2007.   Fuel  prices
increased  significantly  beginning in  late  February  2008  and
peaked  in  July  2008, contributing to an increase  in  trucking
company failures.  We believe these failures resulted in  a  more
even balance of truck supply to freight demand, which caused pre-
books  in  June  2008 to exceed those in June 2007 and  pre-books
during  third  quarter 2008 to be flat compared to third  quarter
2007.   A  very  weak retail environment combined with  extremely

                                21
<PAGE>

soft   housing  and  manufacturing  markets  resulted  in   fewer
available shipments during fourth quarter 2008 compared to fourth
quarter  2007.   Fuel prices also decreased significantly  during
fourth quarter 2008, resulting in fewer trucking company failures
during fourth quarter 2008.

     Freight  demand  softness caused  by the  weak  economy  and
excess  truck  capacity  made  for a challenging  freight  market
during  much  of 2008.  We believe these factors increased  price
competition  for freight in the spot market as carriers  competed
for  loads to maintain truck productivity.  Our Van fleet has the
most  exposure  to  the spot freight market and  faced  the  most
operational and competitive challenges.  As a result,  to  better
match the volume of freight with the number of trucks and improve
profitability, we reduced the size of this fleet by 750 trucks in
2008,  including a reduction of 500 trucks during fourth  quarter
2008.  This decrease in the Van fleet was partially offset by  an
increase  in trucks in the more profitable Regional and Expedited
fleets, as total trucks decreased by 550 during 2008.  As freight
demand  deteriorated during fourth quarter 2008 and into  January
2009,  we  reduced the Van fleet by an additional 150  trucks  in
January  2009.  Since March 2007, we have reduced the  Van  fleet
from  3,000  trucks to about 1,350 trucks (a reduction  of  1,650
trucks).

     To-date in 2009, the freight market remains very challenging
and  demand  continues to be lower than a year ago.  January  and
February freight demand is very depressed, and we continue to see
the freight market weaken, even after considering the significant
fleet reduction we implemented in fourth quarter 2008 and January
2009.

     The  average percentage of empty miles decreased to 13.3% in
2008  from  13.5%  in 2007.  This decrease was the  result  of  a
decrease  in  the average empty miles percentage related  to  the
Dedicated  fleets.  These fleets generally operate  according  to
arrangements under which we provide trucks and/or trailers for  a
specific  customer's  exclusive use. Under nearly  all  of  these
arrangements,  Dedicated customers pay us on  an  all-mile  basis
(regardless  of whether trailers are loaded or empty)  to  obtain
guaranteed truck and/or trailer capacity.  For freight management
and  statistical reporting purposes, we classify a  mile  without
cargo  in the trailer as an "empty mile" or "deadhead mile."   If
we   excluded  the  Dedicated  fleet,  the  average  empty   mile
percentage  would  be  12.4% in 2008 and  11.8%  in  2007.   This
increase  resulted  from  the  weaker  freight  market  and  more
regional shipments with shorter lengths of haul.

     Fuel surcharge revenues represent collections from customers
for  the higher cost of fuel.  These revenues increased to $442.6
million in 2008 from $301.8 million in 2007 in response to higher
average fuel prices in 2008.  To lessen the effect of fluctuating
fuel  prices  on our margins, we collect fuel surcharge  revenues
from our customers.  Our fuel surcharge programs are designed  to
(i) recoup higher fuel costs from customers when fuel prices rise
and  (ii) provide customers with the benefit of lower fuel  costs
when  fuel prices decline.  Our fuel surcharge standard is a  one
(1.0)  cent per mile rate increase for every five (5.0) cent  per
gallon  increase  in  the  DOE weekly  retail  on-highway  diesel
prices.   This standard is used for many fuel surcharge programs.
Some  customers  also  have  their own  fuel  surcharge  standard
program  for  carriers.  These programs enable us  to  recover  a
majority,  but  not  all,  of  the  fuel  price  increases.   The
remaining portion is generally not recoverable because  of  empty
miles  not billable to customers, out-of-route miles, truck  idle
time and the volatility of fuel prices when prices change rapidly
in  short  time  periods.  Also, in a rapidly rising  fuel  price
market,  there  is  generally a several week  delay  between  the
payment  of  higher  fuel prices and surcharge  recovery.   In  a
rapidly  declining  fuel  price market,  the  opposite  generally
occurs,  and  there  is  a  temporary higher  surcharge  recovery
compared to the price paid for fuel.

     VAS  revenues  are generated  by its four  operating  units:
Brokerage, Freight Management, Intermodal and International.  VAS
revenues  increased  3% to $265.3 million  in  2008  from  $258.4
million  in 2007 due to an increase in Brokerage, Intermodal  and
International revenues.  This growth was partially  offset  by  a
structural change to a customer's continuing third-party  carrier
arrangement that became effective in July 2007.  Consequently, we
began  reporting VAS revenues for this customer on  a  net  basis
(revenues net of purchased transportation expense) rather than on
a  gross  basis.   This  change affected  the  reporting  of  VAS
revenues  and purchased transportation expenses for this customer
in  third  quarter 2007 and subsequent periods.   This  reporting
change  resulted in a reduction in VAS revenues and VAS rent  and
purchased transportation expense of $36.3 million comparing  2008
to  2007.   This  reporting change had no impact  on  the  dollar

                                22
<PAGE>

amount  of  VAS gross margin or operating income.  Excluding  the
affected  freight revenues for this customer from 2007  revenues,
VAS  revenues grew 19% in 2008 compared to 2007. VAS gross margin
dollars  increased 18% during 2008 compared to  2007  due  to  an
improvement in the gross margin percentage in the Intermodal  and
International  units offset by a decrease in the  Brokerage  unit
gross margin percentage.

     Brokerage  revenues increased 21% in 2008 compared to  2007,
but  the  Brokerage gross margin percentage and operating  income
percentage  declined.  These declines were due to (i) fuel  price
declines  during the second half of 2008 and (ii) the  tightening
of  truckload capacity in the first half of 2008 due to increased
carrier failures, which made it more challenging for Brokerage to
obtain  qualified third-party carriers at a comparable margin  to
2007.   Intermodal revenues increased by 21%, and  its  operating
income  percentage also improved.  International, formed in  July
2006, revenues grew 86%, and it achieved an improved gross margin
percentage.  Freight Management successfully distributed  freight
to other operating divisions and continues to secure new customer
business  awards  that generate additional freight  opportunities
across all company business units.

Operating Expenses

     Our  operating  ratio (operating  expenses  expressed  as  a
percentage  of operating revenues) was 94.8% in 2008 compared  to
93.4% in 2007.  Expense items that impacted the overall operating
ratio are described on the following pages.  As explained on page
21,  the  total  company operating ratio for 2008 was  140  basis
points  higher than 2007 due to the significant increase in  fuel
expense  and recording the related fuel surcharge revenues  on  a
gross basis.  The tables on pages 20-21 show the operating ratios
and operating margins for our two reportable segments,  Truckload
and VAS.

     The  following table  sets forth the cost per total mile  of
operating expense items for the Truckload segment for the periods
indicated.  We  evaluate  operating  costs  for this segment on a
per-mile basis, which is a better measurement tool for  comparing
the results of operations from year to year.

<TABLE>
<CAPTION>

                                                         Increase
                                                        (Decrease)
                                          2008     2007  per Mile
                                       ----------------------------
     <S>                                 <C>      <C>      <C>
     Salaries, wages and  benefits       $.574    $.571    $.003
     Fuel                                 .518     .401     .117
     Supplies and maintenance             .158     .150     .008
     Taxes and licenses                   .112     .115    (.003)
     Insurance and claims                 .106     .092     .014
     Depreciation                         .166     .159     .007
     Rent and purchased transportation    .175     .160     .015
     Communications and utilities         .020     .020     .000
     Other                               (.004)   (.016)    .012

</TABLE>

     Owner-operator  costs  are included in  rent  and  purchased
transportation expense.  Owner-operator miles as a percentage  of
total miles were 11.9% in 2008 compared to 12.3% in 2007.  Owner-
operators  are  independent  contractors  who  supply  their  own
tractor  and  driver  and  are responsible  for  their  operating
expenses  (including driver pay, fuel, supplies  and  maintenance
and  fuel  taxes).  This decrease in owner-operator  miles  as  a
percentage  of  total  miles shifted  costs  from  the  rent  and
purchased  transportation category to other  expense  categories.
Due  to  this  decrease,  we estimate  that  rent  and  purchased
transportation  expense for the Truckload segment  was  lower  by
approximately  0.6  cents  per  total  mile,  and  other  expense
categories  had  offsetting increases on a  total-mile  basis  as
follows: (i) salaries, wages and benefits, 0.2 cents; (ii)  fuel,
0.3 cents; and (iii) depreciation, 0.1 cent.

     Salaries,  wages  and  benefits  in  the  Truckload  segment
increased  0.3  cents  per mile on a total  mile  basis  in  2008
compared  to  2007.   This  increase is primarily  attributed  to
higher student pay (average active trainer teams increased  13%),
higher workers' compensation expense and, as discussed above, the
shift  from rent and purchased transportation to salaries,  wages
and benefits because of the decrease in owner-operator miles as a
percentage  of total miles.  Within the Truckload segment,  these

                                23
<PAGE>

cost increases were offset partially by lower non-driver pay  for
office and equipment maintenance personnel (due to efficiency and
cost  control  improvements)  and lower  group  health  insurance
costs.  Non-driver salaries, wages and benefits increased in  the
non-trucking VAS segment due to growth in the VAS segment.

     The  qualified  and student driver recruiting and  retention
markets improved in 2008 compared to 2007.  The weakness  in  the
construction and automotive industries, trucking company failures
and  fleet  reductions  and a rising national  unemployment  rate
continue  to  positively  affect  our  driver  availability   and
selectivity.    In  addition,  we  believe  our  strong   mileage
utilization and financial strength are attractive to drivers when
compared  to other carriers.  We anticipate that availability  of
drivers  will  remain  strong until current  economic  conditions
improve.   When  economic  conditions  improve,  competition  for
qualified  drivers  will likely increase, and we  cannot  predict
whether  we will experience future driver shortages.  If  such  a
shortage  were  to  occur  and driver  pay  rate  increases  were
necessary   to  attract  and  retain  drivers,  our  results   of
operations  would  be  negatively impacted  to  the  extent  that
corresponding freight rate increases were not obtained.

     Fuel increased 11.7 cents per mile for the Truckload segment
due  primarily  to  higher  average  diesel  fuel  prices  offset
partially  by fuel efficiency improvements.  Average fuel  prices
in  2008  were  76 cents per gallon higher than in  2007,  a  34%
increase.   Average monthly fuel prices in 2008 were higher  than
those  in the comparable months of 2007 for the first ten months,
with  the amount of change over 2007 increasing steadily  through
June  2008 ($1.70 per gallon higher than June 2007).  Fuel prices
began to fall in July 2008 and fell below the 2007 levels in  the
last  two  months of 2008 (December 2008 prices  were  $1.16  per
gallon lower than December 2007).  Average fuel prices to-date in
2009  have  been $1.27 per gallon lower than the same  period  of
2008.

     During  2008, we implemented numerous initiatives to improve
fuel  efficiency  and our fuel miles per gallon  ("mpg").   These
initiatives  include (i) reducing truck engine  idle  time,  (ii)
lowering  non-billable miles, (iii) increasing the percentage  of
aerodynamic,  more  fuel efficient trucks in  the  company  truck
fleet  and (iv) installing APUs in company trucks.  Truck  engine
idle  time  percentages  can  be  affected  by  seasonal  weather
patterns (such as warm summer months and cold winter months) that
prompt drivers to idle the engine to provide air conditioning  or
heating  for  comfort during non-driving periods.   Thus,  engine
idle  time percentages for trucks without APUs may be higher (and
fuel  mpg may be lower as a result) during the summer and  winter
months  as  compared to temperate spring and fall  months.   APUs
provide an alternate source to power heating and air conditioning
systems  when the main engine is not operating, and APUs  consume
significantly less diesel fuel than idling the main  engine.   As
of  December 31, 2008, we had installed APUs in approximately 50%
of   the  company-owned  truck  fleet.   As  a  result  of  these
initiatives, we improved our company truck average mpg by 4.3% in
2008  compared  to  2007. This mpg improvement  resulted  in  the
purchase of 7.0 million fewer gallons of diesel fuel in 2008 than
in  2007.   This  equates to a reduction of approximately  77,000
tons of carbon dioxide emissions.  As we purchase new trucks,  we
intend  to  continue  installing APUs and taking  part  in  other
environmentally  conscious  initiatives,  such  as   our   active
participation  in the SmartWay Transport Partnership  program  of
the EPA.

     We  have  historically been successful recouping a majority,
but  not  all, of fuel cost increases through our fuel  surcharge
program.   The  remaining portion not recouped is caused  by  the
impact  of  operational costs such as truck idling, empty  miles,
and  out-of-route  miles for which we are not compensated.   Each
year  in  the  prior four years, rising fuel costs (net  of  fuel
surcharge  collections) had a negative impact  on  our  operating
income  when  compared to the previous year.  The total  negative
impact  on our operating income due to fuel expense, net of  fuel
surcharge collections, during 2004 to 2008 was approximately  $72
million.

     When  fuel  prices  rise  rapidly, a negative  earnings  lag
occurs  because the cost of fuel rises immediately and the market
indexes  used to determine fuel surcharges increase at  a  slower
pace.   As a result, during these rising fuel price periods,  the
negative  impact  of  fuel  on  our  financial  results  is  more
significant.  This was the trend during the first two quarters of
2008.   In  a  period  of  declining fuel  prices,  we  generally
experience  a  temporary favorable earnings effect  because  fuel

                                24
<PAGE>

costs  decline at a faster pace than the market indexes  used  to
determine  fuel surcharge collections.  This trend  began  during
third  quarter 2008 as fuel prices began to decrease  but  had  a
larger  impact  during  fourth  quarter  2008  when  fuel  prices
decreased  over  $1.70 per gallon from the end of  third  quarter
2008  to  the  end  of  fourth quarter 2008.   This  resulted  in
temporarily  lower  net  fuel  expense  that  helped  to   offset
uncompensated  fuel  costs from truck  idling,  empty  miles  not
billable  to  customers, and out-of-route miles.  If fuel  prices
stabilize  or  increase  in the future,  we  do  not  expect  the
temporary favorable trend to continue.

     Shortages  of  fuel, increases in fuel prices and  petroleum
product  rationing can have a materially adverse  effect  on  our
operations  and profitability.  We are unable to predict  whether
fuel price levels will increase or decrease in the future or  the
extent to which fuel surcharges will be collected from customers.
As   of  December  31,  2008,  we  had  no  derivative  financial
instruments to reduce our exposure to fuel price fluctuations.

     Supplies and maintenance for the Truckload segment increased
0.8  cents  (5%)  per total mile in 2008 compared  to  2007.   An
increase  in the average age of our company truck fleet from  2.1
years  at  December  31, 2007 to 2.5 years at December  31,  2008
caused  an  increase in maintenance cost per  mile.   The  higher
average  age of the truck fleet results in more maintenance  that
is  not  covered by warranty.  In addition to the higher  average
truck age, a higher percentage of the repairs was performed over-
the-road as a result of the decrease in our equipment maintenance
personnel  (see  previous  discussion  of  salaries,  wages   and
benefits).   Over-the-road vendors also raised  their  labor  and
parts  rates  during 2008, which contributed to the  increase  in
maintenance costs.  The prices of some parts purchased from over-
the-road  vendors,  as well as those purchased  for  use  in  our
shops, increased in 2008 because of higher commodity prices.

     Taxes  and licenses for the Truckload segment decreased  0.3
cents  per total mile in 2008 compared to 2007 due to a  decrease
in  fuel  taxes  per mile resulting from the improvement  in  the
company  truck mpg.  An improved mpg results in fewer gallons  of
diesel fuel purchased and consequently less fuel taxes paid.

     Insurance  and  claims for  the Truckload  segment increased
from 9.2  cents per  total mile in  2007 to 10.6  cents per total
mile in 2008 (an increase of 1.4 cents per total mile).  Of  this
increase, 1.2 cents per total mile relates to unfavorable  claims
development  on larger  claims that  occurred in  years prior  to
2008  offset partially  by lower large  claims incurred  in 2008.
The development  of these prior  year claims  will limit  further
negative  development on other large claims in these same  policy
years  as we have now met our annual aggregates in some of  these
older  policy years.  We renewed our liability insurance policies
on  August  1, 2008 and continue to be responsible for the  first
$2.0 million per claim with an annual $8.0 million aggregate  for
claims  between  $2.0  million  and  $5.0  million.   The  annual
aggregate  for claims between $5.0 million and $10.0 million  was
lowered from $5.0 million to $4.0 million effective with the  new
policy  year  beginning  August  1,  2008.   See  Item  3  (Legal
Proceedings)  for information on our bodily injury  and  property
damage  coverage  levels  since August 1,  2005.   Our  liability
insurance premiums for the policy year beginning August  1,  2008
are slightly lower than the previous policy year.

     Depreciation expense for the Truckload segment increased 0.7
cents per total mile in 2008 compared to 2007.  This increase was
due  primarily to depreciation of the APUs installed  on  company
trucks  and,  to  a  lesser extent, to higher costs  of  tractors
purchased during 2008 and a higher ratio of trailers to  tractors
resulting  from the reduction of our fleet.  The APU depreciation
expense is offset by lower fuel costs because tractors with  APUs
generally  consume  less  fuel during periods  of  idle.   Higher
average  miles per tractor during 2008 compared to 2007  has  the
effect  of lowering this fixed cost when evaluated on a  per-mile
basis and offset a portion of the increases discussed above.

     Depreciation expense was historically affected by the engine
emissions  standards imposed by the EPA that became effective  in
October  2002 and applied to all new trucks purchased after  that
time,  resulting in increased truck purchase costs.  Depreciation
expense is affected because in January 2007, a second set of more
strict  EPA engine emissions standards became effective  for  all
newly  manufactured  truck  engines.   Compared  to  trucks  with
engines  produced  before  2007,  the  trucks  with  new  engines
manufactured  under  the  2007  standards  have  higher  purchase
prices.  We  began  to take delivery of trucks with  these  2007-
standard engines in first quarter 2008 to replace older trucks in
our  fleet.  The engines in our fleet of company-owned trucks  as
of  December  31,  2008 consist of 78% Caterpillar,  14%  Detroit

                                25
<PAGE>

Diesel,  7%  Mercedes  Benz  and  1%  Cummins.   In  June   2008,
Caterpillar announced it will not produce on-highway engines  for
use  in  the  United States that will comply with new EPA  engine
emissions  standards that become effective in  January  2010  but
will   continue   to  sell  on-highway  engines  internationally.
Caterpillar  also  announced it is pursuing a strategic  alliance
with  Navistar.   Approximately one million trucks  in  the  U.S.
domestic   market  have  Caterpillar  heavy-duty   engines,   and
Caterpillar has stated it will fully support these engines  going
forward.

     Rent and purchased transportation expense consists mainly of
payments to third-party capacity providers in the VAS segment and
other non-trucking operations and payments to owner-operators  in
the  Truckload segment.  These expenses generally vary  depending
on  changes  in the volume of services generated by the  segment.
As   a  percentage  of  VAS  revenues,  VAS  rent  and  purchased
transportation  expense decreased to 85.0% in  2008  compared  to
86.9%  in 2007.  As discussed on page 22, the VAS segment's  rent
and purchased transportation expense was affected by a structural
change  to a large VAS customer's continuing third-party  carrier
arrangement  that  became effective in July  2007.   That  change
resulted  in  a  reduction  in VAS  revenues  and  VAS  rent  and
purchased  transportation expense of $36.3 million from  2007  to
2008.   Excluding  the rent and purchased transportation  expense
for  this  customer, the dollar amount of this expense  increased
for  the  VAS  segment  by 20% compared to  an  increase  in  VAS
revenues of 19%.

     Rent  and purchased transportation for the Truckload segment
increased  1.5  cents  per total mile in 2008  due  primarily  to
increased fuel prices that necessitated higher reimbursements  to
owner-operators  for fuel during most of 2008 compared  to  2007,
offset slightly by a decrease in the percentage of owner-operator
truck  miles versus company truck miles.  Fuel reimbursements  to
owner-operators  amounted to $53.0 million in  2008  compared  to
$36.0 million in 2007.  These higher fuel reimbursements resulted
in  an  increase of 1.7 cents per total mile.  Our customer  fuel
surcharge  programs do not differentiate between miles  generated
by   company-owned   and  owner-operator   trucks.    Challenging
operating  conditions continue to make owner-operator recruitment
and   retention  difficult  for  us.   Such  conditions   include
inflationary cost increases that are the responsibility of owner-
operators,  higher fuel prices and a shortage of  financing.   We
have  historically  been able to add company-owned  tractors  and
recruit additional company drivers to offset any decrease in  the
number of owner-operators.  If a shortage of owner-operators  and
company  drivers  occurs, increases in per mile settlement  rates
(for  owner-operators) and driver pay rates (for company drivers)
may  become necessary to attract and retain these drivers.   This
could  negatively affect our results of operations to the  extent
that we did not obtain corresponding freight rate increases.

     Other operating expenses for the Truckload segment increased
1.2  cents per mile in 2008.  Gains on sales of assets (primarily
trucks  and  trailers)  are reflected as  a  reduction  of  other
operating   expenses  and  are  reported  net  of   sales-related
expenses,  including  costs to prepare the  equipment  for  sale.
Gains  on sales of assets decreased to $9.9 million in 2008  from
$22.9 million in 2007, or a reduction of 1.2 cents per mile.   We
believe Fleet Truck Sales demand softened during 2008 due to  the
softer freight market and higher fuel prices.  At the same  time,
carrier  failures  and  company fleet  reductions  increased  the
supply  of  used  trucks for sale.  We expect this  to  continue,
which  will likely have a continued negative impact on the amount
of  our  gains  on sales.  We continued to sell  our  oldest  van
trailers  that  are fully depreciated and we expect  to  continue
doing so in 2009, although the market for used trailers has  also
softened.   Our  wholly-owned subsidiary and  used  truck  retail
network, Fleet Truck Sales, is one of the largest Class  8  truck
sales entities in the United States.  Fleet Truck Sales continues
to be our resource for remarketing our used trucks and trailers.

Other Expense (Income)

     We  recorded $0.1 million of interest expense in 2008 versus
$3.0   million  of  interest  expense  in  2007.    Our   average
outstanding debt per month in 2007 was over $45 million, while in
2008  we had no outstanding debt until the end of November  2008.
We  had  $30.0  million of debt outstanding  and  cash  and  cash
equivalents of $48.6 million at December 31, 2008, for a net cash
position of $18.6 million.  Our interest income was $4.0  million
in  2008 and 2007.  Our average cash and cash equivalents balance
was  higher  in 2008 than in 2007, but the average interest  rate
earned on these funds was lower in 2008.

                                26
<PAGE>

Income Taxes

     Our  effective income tax rate (income taxes expressed as  a
percentage  of  income before income taxes) was  42.3%  for  2008
versus 45.1% for 2007.  During fourth quarter 2007, we reached  a
tentative  settlement agreement with an Internal Revenue  Service
("IRS")  appeals  officer regarding a significant  tax  deduction
based on a timing difference between financial reporting and  tax
reporting  for  our  2000  to 2004 federal  income  tax  returns.
During  fourth quarter 2007, we accrued the estimated  cumulative
interest  charges, net of income taxes, of $4.0 million  for  the
anticipated  settlement of this matter.  The  IRS  finalized  the
settlement  during third quarter 2008, and we paid  the  IRS  the
federal  accrued interest at the beginning of October  2008.   We
filed  amended state returns reporting the IRS settlement changes
to  the states where required during fourth quarter 2008.  We are
now  working  with  those  states to settle  our  state  interest
liabilities.  Our total payments during 2008, before  considering
the  tax  benefit from the deductibility of these payments,  were
$4.9 million for federal and $0.4 million to various states.   We
expect  to  pay  about $1 million to settle the  remaining  state
liabilities.   Our policy is to recognize interest and  penalties
directly  related  to  income  taxes  as  additional  income  tax
expense.   See also Note 4 of the Notes to Consolidated Financial
Statements under Item 8 of this Form 10-K.

2007 Compared to 2006
---------------------

Operating Revenues

     Operating  revenues decreased 0.5% in 2007 compared to 2006.
Excluding  fuel  surcharge revenues, trucking revenues  decreased
1.3%  due  primarily to a 2.5% decrease in the average number  of
tractors   in  service  (as  discussed  further  below),   offset
partially by a 1.4% increase in average annual miles per tractor.
The  truckload  freight market was softer  during  most  of  2007
compared  to  2006.  Additionally, the significant  industry-wide
accelerated purchase of new trucks in advance of the new 2007 EPA
engine  emissions standards contributed to excess truck  capacity
that  partially  disrupted the supply and demand  balance  during
2007.   These  combined factors negatively affected revenues  per
total mile, which decreased 0.1% in 2007 compared to 2006.

     Freight demand  softness and the temporary increase  in  the
supply  of trucks caused by the industry truck pre-buy  made  for
challenging freight market conditions during 2007.  In  mid-March
2007, we began reducing our Van fleet by a total of 250 trucks to
better  match the volume of freight with the capacity  of  trucks
and  to  improve  profitability.  This  fleet  has  the  greatest
exposure   to  the  spot  freight  market  and  faced  the   most
operational  and competitive challenges.  By the latter  part  of
April  2007, this initial Van fleet reduction goal was  achieved,
but  we  had  not yet achieved the desired balance of trucks  and
freight.  As a result, we decided to further reduce our Van fleet
by  an  additional 400 trucks, which we completed by the  end  of
June  2007.  We were able to transfer a portion of our Van  fleet
trucks  to other more profitable fleets.  The net impact  to  our
total fleet was an approximate 500-truck reduction from mid-March
2007  to  the end of June 2007.  Beginning in the second week  of
November  2007,  we  reduced our Van fleet by an  additional  100
trucks  due to further weakness in the Van market.  This resulted
in  a  cumulative 750-truck reduction of our Van fleet from  mid-
March 2007 to December 2007.

     The  average percentage of empty miles increased to 13.5% in
2007  from 13.1% in 2006.  This increase resulted from the weaker
freight  market, a higher percentage of Dedicated trucks  in  the
total  fleet and more regional shipments with shorter lengths  of
haul.  If we excluded the Dedicated fleet, the average empty mile
percentage would be 11.8% in 2007 and 10.8% in 2006.

     Fuel  surcharge revenues increased to $301.8 million in 2007
from  $286.8  million in 2006 in response to higher average  fuel
prices in 2007.

     VAS  revenues decreased  2.8% to $258.4 million in 2007 from
$266.0 million in 2006 due to a structural change to a customer's
continuing  third-party carrier arrangement, offset partially  by
an  increase in Brokerage and International revenues.  VAS  gross
margin  dollars  increased 34.2% for the same period  due  to  an
improvement  in the gross margin percentage in the Brokerage  and

                                27
<PAGE>

Intermodal  divisions.   The  structural  change  resulted  in  a
reduction   in   VAS   revenues  and  VAS  rent   and   purchased
transportation expense of $38.5 million comparing the second half
of  2006 to the second half of 2007.  This  change had no  impact
on  the  dollar  amount of VAS gross margin or operating  income.
Excluding  the  affected freight revenues for this customer,  VAS
revenues grew 13% in 2007 compared to 2006.

Operating Expenses

     Our  operating ratio was 93.4% in 2007 compared to 92.1%  in
2006.   Expense  items that impacted the overall operating  ratio
are  described on the following pages.  As explained on page  21,
the  total  company  2007 operating ratio was  110  basis  points
higher  due  to  the  significant increase in  fuel  expense  and
recording  the related fuel surcharge revenues on a gross  basis.
The tables on pages 20-21 show the operating ratios and operating
margins for our two reportable segments, Truckload and VAS.

     The  following  table sets forth the cost per total mile  of
operating  expense items for the Truckload segment for the  years
indicated.

<TABLE>
<CAPTION>

                                                         Increase
                                                        (Decrease)
                                          2007     2006  per Mile
                                       ----------------------------
     <S>                                 <C>      <C>      <C>
     Salaries, wages and benefits        $.571    $.564    $.007
     Fuel                                 .401     .377     .024
     Supplies and maintenance             .150     .145     .005
     Taxes and licenses                   .115     .114     .001
     Insurance and claims                 .092     .090     .002
     Depreciation                         .159     .158     .001
     Rent and purchased transportation    .160     .150     .010
     Communications and utilities         .020     .019     .001
     Other                               (.016)   (.013)   (.003)

</TABLE>

     Owner-operator  miles as a percentage of  total  miles  were
12.3% in 2007 compared to 11.8% in 2006.  This increase in owner-
operator  miles as a percentage of total miles shifted  costs  to
the rent and purchased transportation category from other expense
categories.   We  estimate that rent and purchased transportation
expense for the Truckload segment was higher by approximately 0.7
cents  per  total  mile due to this increase, and  other  expense
categories  had  offsetting decreases on a  total-mile  basis  as
follows: (i) salaries, wages and benefits, 0.3 cents; (ii)  fuel,
0.2   cents;  (iii)  taxes  and  licenses,  0.1  cent;  and  (iv)
depreciation, 0.1 cent.

     Salaries,  wages and benefits for non-drivers  increased  in
2007  compared  to  2006  due  to a larger  number  of  employees
required  to support the growth in the non-trucking VAS  segment.
Non-driver salaries for the Truckload segment were flat  in  2007
compared  to 2006.  The increase in salaries, wages and  benefits
per  mile  of  0.7 cents for the Truckload segment  is  primarily
attributed  to  (i)  an increase in student  driver  pay  as  the
average  number of student trainer teams was higher in 2007  than
in 2006; (ii) an increase in the Dedicated fleet truck percentage
as  Dedicated drivers typically earn a higher rate per mile  than
drivers in our other truck fleets; and (iii) higher group  health
insurance costs.  These cost increases for the Truckload  segment
were  partially  offset  by a decrease in  workers'  compensation
expense,  lower state unemployment tax expense and a decrease  in
equipment maintenance personnel.

     The   driver  recruiting  and  retention  market  was   less
difficult  in  2007  than  in the 2006  due  to  improved  driver
availability.   The weakness in the housing market  and  the  Van
fleet  reduction  contributed favorably to our driver  recruiting
and retention efforts.

     Fuel  increased 2.4 cents per mile for the Truckload segment
due primarily to higher average diesel fuel prices.  Average fuel
prices  in 2007 were 20 cents per gallon, or 10%, higher than  in
2006.   Higher net fuel costs had a nine cent negative impact  on
earnings per share in 2007 compared to 2006.  We include  all  of
the  following items when calculating fuel's impact  on  earnings

                                28
<PAGE>

for  both  periods: (i) average fuel price per gallon, (ii)  fuel
reimbursements paid to owner-operator drivers, (iii) mpg and (iv)
offsetting fuel surcharge revenues from customers.

     During third quarter 2006, truckload carriers transitioned a
gradually  increasing  portion of their diesel  fuel  consumption
from  low  sulfur diesel fuel to ultra-low sulfur diesel ("ULSD")
fuel.   This  transition  occurred  because  fuel  refiners  were
required  to meet the EPA-mandated 80% ULSD threshold by  October
15, 2006.  Preliminary estimates indicated that ULSD would result
in  a  1-3%  degradation in mpg for all trucks due to  the  lower
energy content (btu) of ULSD.  Since the transition occurred, the
result is an approximate 2% degradation of mpg.  We believe  that
other   factors  which  impact  mpg,  including  increasing   the
percentage of aerodynamic trucks in our company truck fleet, have
offset the negative mpg impact of ULSD.

     Supplies and maintenance for the Truckload segment increased
0.5  cents (3%) per total mile in 2007 compared to 2006.   Higher
over-the-road  tractor repairs and maintenance were  the  primary
cause  of  this  increase  because the  increased  percentage  of
Dedicated fleet trucks requires more repairs to be performed off-
site  rather than at our terminals. In addition, the average  age
of  our  company-owned  truck fleet increased  to  2.1  years  at
December 31, 2007 compared to 1.3 years at December 31, 2006.   A
portion of this increase was offset by lower non-driver salaries,
wages  and benefits from a decrease in maintenance personnel,  as
previously  noted.  Our trailer repair costs were slightly  lower
in  2007 than in 2006 because the purchase of new van trailers to
replace  our oldest van trailers lowered the average age  of  our
trailer fleet.

     Insurance  and  claims  for  the  Truckload  segment did not
change significantly from 2006 to 2007, increasing just 0.2 cents
(2%)  on a  per-mile basis.  We  renewed our liability  insurance
policies  on August 1, 2007  and became responsible for an annual
$8.0 million aggregate for claims between $2.0 million  and  $5.0
million.   During the policy year that ended July  31,  2007,  we
were  responsible for a lower $2.0 million aggregate  for  claims
between  $2.0 million and $3.0 million and no aggregate  (meaning
that  we were fully insured) for claims between $3.0 million  and
$5.0 million.  See Item 3 (Legal Proceedings) for information  on
our  bodily  injury  and  property damage coverage  levels  since
August  1, 2005.  Our liability insurance premiums for the policy
year  beginning  August  1,  2007 are  slightly  lower  than  the
previous policy year.

     Rent and purchased transportation expense consists mainly of
payments to third-party capacity providers in the VAS segment and
other non-trucking operations and payments to owner-operators  in
the  Truckload  segment.   As  discussed  on  page  27,  the  VAS
segment's rent and purchased transportation expense decreased  in
response  to  a  structural  change to  a  large  VAS  customer's
continuing  arrangement  regarding  third-party  carriers.   That
change  resulted in a reduction in VAS revenues and VAS rent  and
purchased  transportation expense of $38.5 million comparing  the
second  half  of 2006 to the second half of 2007.  Excluding  the
rent and purchased transportation expense for this customer,  the
dollar  amount  of  this expense increased for the  VAS  segment,
similar to VAS revenues.  These expenses generally vary depending
on  changes  in the volume of services generated by the  segment.
As   a  percentage  of  VAS  revenues,  VAS  rent  and  purchased
transportation  expense decreased to 86.9% in  2007  compared  to
90.5% in 2006.

     Rent  and purchased transportation for the Truckload segment
increased  1.0 cent per total mile in 2007 due primarily  to  the
increase  in the percentage of owner-operator truck miles  versus
company  truck  miles.  Increased fuel prices  also  necessitated
higher  reimbursements to owner-operators for fuel ($36.0 million
in 2007 compared to $32.7 million in 2006).  These reimbursements
resulted in an increase of 0.3 cents per total mile.

     Other operating expenses for the Truckload segment decreased
0.3  cents per mile in 2007.  Gains  on sales of assets decreased
to  $22.9  million  in  2007  from  $28.4  million  in  2006.  We
continued  to  sell  our  oldest  van  trailers  that  are  fully
depreciated and replaced them with new trailers.  Other operating
expenses also include bad debt expense.  In 2006, we recorded  an
additional  $7.2 million related  to the bankruptcy of one of our
former customers.

                                29
<PAGE>

Other Expense (Income)

     We  recorded $3.0 million of interest expense in 2007 versus
$1.2 million of interest expense in 2006 because our average debt
levels  were  higher  in  2007.  We had no  debt  outstanding  at
December 31, 2007.  Our interest income decreased to $4.0 million
in 2007 from $4.4 million in 2006.

Income Taxes

     Our  effective  income  tax rate was 45.1% for  2007  versus
41.1%  for  2006.   During  fourth quarter  2007,  we  reached  a
tentative  settlement  agreement  with  an  IRS  appeals  officer
regarding  a  significant  timing  difference  deduction  between
financial  reporting  and tax reporting  for  our  2000  to  2004
federal  income tax returns.  We accrued the estimated cumulative
interest  charges, net of income taxes, of $4.0 million  for  the
anticipated  settlement  of  this  matter.   Our  policy  is   to
recognize interest and penalties directly related to income taxes
as  additional income tax expense.  See also Note 4 of the  Notes
to  Consolidated Financial  Statements under  Item 8 of this Form
10-K.

Liquidity and Capital Resources:

     During  the year ended December 31, 2008, we generated  cash
flow  from operations of $259.1 million, a 13.7% increase  ($31.1
million),  in  cash flow compared to the year ended December  31,
2007.   This  increase is attributed primarily  to  (i)  a  $23.2
million  change  in  cash  flows  related  to  accounts  payable,
primarily due to the timing of revenue equipment payments, (ii) a
lower accounts receivable balance due primarily to a decrease  in
the average fuel surcharge billed per trip at the end of 2008 and
(iii)  the  effect of $13.0 million lower gains  on  disposal  of
operating  equipment, offset by (iv) lower  net  income  of  $7.8
million.   Cash flow from operations decreased $56.1  million  in
2007  compared to 2006, or 19.7%.  The decrease in cash flow from
operations in 2007 compared to 2006 was due primarily to a  $33.8
million  change  in  accounts payable for revenue  equipment  and
lower  net  income of $23.3 million.  We were able  to  make  net
capital  expenditures, repurchase common stock and pay  dividends
because  of  the  cash  flow from operations  and  existing  cash
balances,  supplemented  by  net borrowings  under  our  existing
credit facilities.

     Net  cash  used in investing activities increased  by  $89.3
million  to  $109.4 million in 2008 from $20.1 million  in  2007.
Net  property additions (primarily revenue equipment) were $115.0
million  for the year ended December 31, 2008 compared  to  $26.1
million  during  the same period of 2007.  The increase  occurred
because we began to take delivery of new trucks in 2008, while we
took  delivery of substantially fewer new trucks during  2007  to
delay purchases of more expensive trucks with 2007 engines.   The
$216.1 million decrease in investing cash flows from 2006 to 2007
was due primarily to the purchase of more tractors in 2006 as  we
began  to reduce the average age of our truck fleet prior to  the
2007  engine change.  The average age of our truck fleet  is  2.5
years at December 31, 2008 compared to 2.1 years at December  31,
2007  and  1.3  years at December 31, 2006.  As of  December  31,
2008,  we  were committed to property and equipment purchases  of
approximately $46.6 million.  We expect our estimated net capital
expenditures (primarily revenue equipment) to be in the range  of
$50.0 million to $125.0 million in 2009.  We intend to fund these
net  capital  expenditures through cash flow from operations  and
financing  available  under our existing  credit  facilities,  as
management deems necessary.

     Net financing activities used $119.3 million in 2008, $214.4
million  in  2007 and $52.8 million in 2006.  The  decrease  from
2007  to  2008  included debt repayments (net of  borrowings)  of
$100.0  million  in  2007  compared to net  borrowings  of  $30.0
million in 2008.  We had net borrowings of $40.0 million in 2006.
During  first quarter 2009, we repaid the total $30.0 million  of
debt  that  was  outstanding  on  December  31,  2008.   We  paid
dividends  of $164.4 million in 2008, $14.0 million in  2007  and
$13.3  million  in 2006.  The 2008 dividends included  a  special
dividend  of  $2.10  per  share ($150.3 million  total)  paid  in
December 2008.  We increased our regular quarterly dividend  rate
by $0.005 per share beginning with the dividend paid in July 2007
and  the  dividend paid in July 2006.  Financing activities  also
included common stock repurchases of $4.8 million in 2008, $113.8
million  in 2007 and $85.1 million in 2006.  From time  to  time,
the  Company  has  repurchased, and may continue  to  repurchase,
shares  of the Company's common stock.  The timing and amount  of

                                30
<PAGE>

such  purchases  depends  on market and  other  factors.   As  of
December  31,  2008, the Company had purchased  1,041,200  shares
pursuant   to   our   current  Board  of   Directors   repurchase
authorization  and had 6,958,800 shares remaining  available  for
repurchase.

     Management  believes our financial position at December  31,
2008 is strong.  As of December 31, 2008, we had $48.6 million of
cash  and  cash  equivalents and $745.5 million of  stockholders'
equity.   Cash  is invested in government portfolio money  market
funds.    We   do   not  hold  any  investments  in  auction-rate
securities.   As of December 31, 2008, we had a total  of  $225.0
million of credit pursuant to two credit facilities, of which  we
had  borrowed  $30.0 million.  The remaining  $195.0  million  of
credit available under these facilities is further reduced by the
$43.9 million in letters of credit we maintain.  These letters of
credit are primarily required as security for insurance policies.
As  of  December  31,  2008, we did not have  any  non-cancelable
revenue  equipment  operating leases and therefore  had  no  off-
balance  sheet  revenue  equipment debt.   Based  on  our  strong
financial  position, management does not foresee any  significant
barriers to obtaining sufficient financing, if necessary.

Contractual Obligations and Commercial Commitments:

     The  following  table sets forth our contractual obligations
and commercial commitments as of December 31, 2008.

<TABLE>
<CAPTION>

                     Payments Due by Period
                          (in millions)


                                                                                    More
                                                Less than                          than 5     Period
                                       Total      1 year    1-3 years  3-5 years    years     Unknown
-----------------------------------------------------------------------------------------------------------
 <S>                                  <C>        <C>        <C>        <C>        <C>        <C>
 Contractual Obligations
 Long-term debt, including current
   maturities                         $   30.0   $   30.0   $      -   $      -   $      -   $      -
 Unrecognized tax benefits                 7.4        1.4          -          -          -        6.0
 Equipment purchase commitments           46.6       46.6          -          -          -          -
                                      --------   --------   --------   --------   --------   --------
 Total contractual cash obligations   $   84.0   $   78.0   $      -   $      -   $      -   $    6.0
                                      ========   ========   ========   ========   ========   ========

 Other Commercial
 Commitments
 Unused lines of credit               $  151.1   $   50.0   $  101.1   $      -   $      -   $      -
 Standby letters of credit                43.9       43.9          -          -          -          -
                                      --------   --------   --------   --------   --------   --------
 Total commercial commitments         $  195.0   $   93.9   $  101.1   $      -   $      -   $      -
                                      ========   ========   ========   ========   ========   ========

         Total obligations            $  279.0   $  171.9   $  101.1   $      -   $      -   $    6.0
                                      ========   ========   ========   ========   ========   ========

</TABLE>

     We  have committed credit facilities with two banks totaling
$225.0  million,  of  which  we have borrowed  $30.0  million  at
December  31,  2008.  During first quarter 2009,  we  repaid  the
total $30.0 million of debt that was outstanding on December  31,
2008.   These credit facilities bear variable interest  (2.0%  at
December  31,  2008) based on the London Interbank  Offered  Rate
("LIBOR"). The credit available under these facilities is further
reduced by the amount of standby letters of credit under which we
are obligated.  The unused lines of credit are available to us in
the  event we need financing for the replacement of our fleet  or
for  other  significant capital expenditures.  Given  our  strong
financial  position,  we expect that we could  obtain  additional
financing,  if  necessary.  The standby  letters  of  credit  are
primarily   required  for  insurance  policies.   The   equipment
purchase  commitments relate to committed equipment expenditures.
On  January  1,  2007, we adopted Financial Accounting  Standards
Board  ("FASB") Interpretation No. 48, Accounting for Uncertainty
in Income Taxes-an Interpretation of FASB Statement No. 109 ("FIN
48").  As of December 31, 2008, we have recorded $7.4 million  of
unrecognized tax benefits.  We expect $1.4 million to be  settled
within  the  next  twelve  months and are  unable  to  reasonably
determine  when the $6.0 million categorized as "period  unknown"
will be settled.

                                31
<PAGE>

Off-Balance Sheet Arrangements:

     In  2008,  we  did  not  have  any  non-cancelable   revenue
equipment  operating leases or other arrangements that  meet  the
definition of an off-balance sheet arrangement.

Critical Accounting Policies:

     We  operate in the truckload sector of the trucking industry
and  the logistics sector of the transportation industry.  In the
truckload  sector,  we focus on transporting consumer  nondurable
products  that generally ship consistently throughout  the  year.
In   the   logistics  sector,  besides  managing   transportation
requirements  for  individual customers,  we  provide  additional
sources of truck capacity, alternative modes of transportation, a
global   delivery  network  and  systems  analysis  to   optimize
transportation  needs.  Our success depends  on  our  ability  to
efficiently  manage  our resources in the delivery  of  truckload
transportation and logistics services to our customers.  Resource
requirements  vary  with customer demand and may  be  subject  to
seasonal or general economic conditions.  Our ability to adapt to
changes  in customer transportation requirements is essential  to
efficient  resource  deployment, making  capital  investments  in
tractors and trailers or obtaining qualified third-party  carrier
capacity at a reasonable price.  Although our business volume  is
not highly concentrated, we may also be occasionally affected  by
our customers' financial failures or loss of customer business.

     Our  most  significant  resource  requirements  are  company
drivers,   owner-operators,  tractors,   trailers   and   related
equipment  operating costs (such as fuel and related fuel  taxes,
driver pay, insurance and supplies and maintenance).  To mitigate
our  risk  to  fuel price increases, we recover  additional  fuel
surcharges  from  our customers that recoup a majority,  but  not
all,  of the increased fuel costs; however, we cannot assure that
current  recovery  levels will continue in future  periods.   Our
financial results are also affected by company driver and  owner-
operator  availability  and the new and  used  revenue  equipment
market.  Because we are self-insured for a significant portion of
bodily  injury, property damage and cargo claims and for workers'
compensation  benefits  and  health  claims  for  our   employees
(supplemented  by premium-based insurance coverage above  certain
dollar  levels), financial results may also be affected by driver
safety, medical costs, weather, legal and regulatory environments
and  insurance  coverage  costs to protect  against  catastrophic
losses.

     The  most significant accounting policies and estimates that
affect our financial statements include the following:

     * Selections  of  estimated  useful lives and salvage values
       for  purposes  of  depreciating   tractors  and  trailers.
       Depreciable lives of tractors and trailers range from 5 to
       12 years.  Estimates of salvage value at the expected date
       of  trade-in  or  sale  (for  example,   three  years  for
       tractors)  are based  on the  expected  market  values  of
       equipment  at the  time of  disposal.  Although our normal
       replacement  cycle  for   tractors  is  three   years,  we
       calculate  depreciation  expense for  financial  reporting
       purposes  using a  five-year life and 25%  salvage  value.
       Depreciation  expense calculated  in this manner continues
       at  the same  straight-line rate  (which approximates  the
       continuing declining market value of the tractors) when  a
       tractor  is  held  beyond  the   normal  three-year   age.
       Calculating  depreciation expense  using a  five-year life
       and  25%  salvage  value  results   in  the  same   annual
       depreciation rate (15% of cost per year) and the same  net
       book value at the normal three-year replacement date  (55%
       of cost) as using a three-year life and 55% salvage value.
       We  continually  monitor  the  adequacy  of  the lives and
       salvage values  used in calculating  depreciation  expense
       and adjust these assumptions appropriately when warranted.
     * Impairment of long-lived assets.  We review our long-lived
       assets  for  impairment  whenever  events or circumstances
       indicate the carrying amount of a long-lived asset may not
       be recoverable.  An impairment loss would be recognized if
       the  carrying  amount  of  the  long-lived  asset  is  not
       recoverable and  the  carrying  amount  exceeds  its  fair
       value.  For long-lived assets classified as held and used,
       the carrying amount is not recoverable  when the  carrying
       value  of the  long-lived asset  exceeds the  sum  of  the

                                32
<PAGE>

       future  net  cash  flows.  We do  not separately  identify
       assets by operating segment because tractors and  trailers
       are  routinely  transferred  from  one  operating fleet to
       another.  As a result, none of our long-lived assets  have
       identifiable  cash  flows  from  use   that  are   largely
       independent  of  the  cash  flows  of   other  assets  and
       liabilities.   Thus,   the  asset  group  used  to  assess
       impairment would include all of our assets.
     * Estimates of accrued liabilities for insurance and  claims
       for  liability and  physical  damage losses  and  workers'
       compensation.  The insurance and claims accruals  (current
       and  noncurrent) are  recorded at  the estimated  ultimate
       payment  amounts  and  are  based   upon  individual  case
       estimates  (including negative  development) and estimates
       of incurred-but-not-reported losses using loss development
       factors  based upon past  experience.  An  actuary reviews
       our self-insurance reserves for bodily injury and property
       damage claims  and workers' compensation  claims every six
       months.
     * Policies  for  revenue  recognition.   Operating  revenues
       (including  fuel surcharge  revenues)  and related  direct
       costs  are recorded  when the  shipment is delivered.  For
       shipments where a third-party capacity provider (including
       owner-operators  under contract  with us) is  utilized  to
       provide  some  or  all of  the service  and we (i) are the
       primary  obligor in regard  to the shipment delivery, (ii)
       establish  customer pricing  separately  from carrier rate
       negotiations,  (iii)  generally have discretion in carrier
       selection and/or (iv) have credit risk on the shipment, we
       record  both revenues for the  dollar value of services we
       bill to the customer and rent and purchased transportation
       expense for transportation costs we pay to the third-party
       provider upon the shipment's delivery.  In the absence  of
       the  conditions  listed  above, we  record revenues net of
       those expenses related to third-party providers.
     * Accounting  for  income  taxes.   Significant   management
       judgment  is  required to determine  (i) the provision for
       income taxes, (ii) whether deferred  income taxes will  be
       realized  in full or  in part and (iii)  the liability for
       unrecognized   tax   benefits  in   accordance  with   the
       provisions  of  FIN 48.  Deferred  income  tax  assets and
       liabilities are measured using enacted tax rates that  are
       expected  to apply  to taxable  income in  the years  when
       those  temporary differences  are expected to be recovered
       or  settled.  When  it  is  more  likely  that all or some
       portion of specific deferred income tax assets will not be
       realized, a  valuation allowance  must be established  for
       the  amount  of  deferred  income  tax  assets   that  are
       determined  not  to be  realizable.  A valuation allowance
       for  deferred  income  tax  assets  has  not  been  deemed
       necessary  due to our profitable operations.  Accordingly,
       if   facts   or   financial   circumstances   change   and
       consequently  impact  the   likelihood  of  realizing  the
       deferred  income  tax  assets,  we  would  need  to  apply
       management's judgment to determine the amount of valuation
       allowance required in any given period.
     * Allowance  for  doubtful  accounts.   The  allowance   for
       doubtful  accounts  is  our  estimate  of  the  amount  of
       probable   credit   losses  in   our   existing   accounts
       receivable.    We  review  the  financial   condition   of
       customers  for  granting  credit and  monitor  changes  in
       customers' financial conditions on an ongoing  basis.   We
       determine  the allowance based on our historical write-off
       experience  and  national  economic  conditions.    During
       2008,  numerous  significant  events  affected  the   U.S.
       financial  markets and resulted in a significant reduction
       of  credit  availability and liquidity.  Consequently,  we
       believe  some of our customers may be unable to obtain  or
       retain  adequate financing to support their businesses  in
       the  future.  We anticipate that because of these combined
       factors,  some of our customers may also be  compelled  to
       restructure  their  businesses or may  be  unable  to  pay
       amounts  owed to us.  We have formal policies in place  to
       continually  monitor credit extended to customers  and  to
       manage our credit risk.  We maintain credit insurance  for
       some  customer accounts.  We evaluate the adequacy of  our
       allowance for doubtful accounts quarterly and believe  our
       allowance  for  doubtful accounts  is  adequate  based  on
       information currently available.

     Management  periodically  re-evaluates  these  estimates  as
events  and  circumstances change.  Together with the effects  of
the  matters  discussed  above, these factors  may  significantly
impact our results of operations from period to period.

                                33
<PAGE>

Inflation:

     Inflation  may  impact  our operating  costs.   A  prolonged
inflation period could cause rises in interest rates, fuel, wages
and  other  costs.  These inflationary increases could  adversely
affect  our results of operations unless freight rates  could  be
increased correspondingly.  However, the effect of inflation  has
been minimal over the past three years.

ITEM 7A. QUANTITATIVE  AND  QUALITATIVE DISCLOSURES ABOUT  MARKET
         RISK

     We  are  exposed  to  market risk from changes  in  interest
rates, commodity prices and foreign currency exchange rates.

Interest Rate Risk

     We  had  $30.0 million of variable rate debt outstanding  at
December 31, 2008.  Interest rates on the variable rate debt  and
our  unused credit facilities are based on the LIBOR.   Increases
in  interest  rates could impact our annual interest  expense  on
future   borrowings.   Assuming  this  level  of  borrowings,   a
hypothetical one-percentage point increase in the LIBOR  interest
rate would increase our annual interest expense by $300,000.   As
of  December  31,  2008, we do not have any derivative  financial
instruments to reduce our exposure to interest rate increases.

Commodity Price Risk

     The  price  and  availability of diesel fuel are subject  to
fluctuations  attributed to changes in the level  of  global  oil
production,  refining capacity, seasonality,  weather  and  other
market factors.  Historically, we have recovered a majority,  but
not  all, of fuel price increases from customers in the  form  of
fuel surcharges.  We implemented customer fuel surcharge programs
with most of our customers to offset much of the higher fuel cost
per  gallon.   However, we do not recover all of  the  fuel  cost
increase through these surcharge programs.  We cannot predict the
extent  to  which  fuel prices will increase or decrease  in  the
future or the extent to which fuel surcharges could be collected.
As   of  December  31,  2008,  we  had  no  derivative  financial
instruments to reduce our exposure to fuel price fluctuations.

Foreign Currency Exchange Rate Risk

     We  conduct business in several foreign countries, including
Mexico,  Canada  and China.  Foreign currency transaction  losses
were $7.0 million for 2008 and were recorded in accumulated other
comprehensive   loss   within   stockholders'   equity   in   the
Consolidated  Balance Sheets.  Amounts of gains  and  losses  for
2007  and 2006 were not material.  To date, most foreign revenues
are  denominated  in  U.S. Dollars, and we  receive  payment  for
foreign  freight  services primarily in U.S.  Dollars  to  reduce
direct  foreign currency risk.  Assets and liabilities maintained
by  subsidiary  companies in the local currency  are  subject  to
foreign   exchange   gains  or  losses.   The  foreign   currency
transaction losses for 2008 were primarily related to changes  in
the  value of revenue equipment owned by a subsidiary in  Mexico,
whose functional currency is the Peso.  The exchange rate between
the  Mexico Peso and the U.S. Dollar was 13.54 Pesos to $1.00  at
December  31, 2008 compared to 10.87 Pesos to $1.00  at  December
31, 2007.

                                34
<PAGE>

ITEM 8.   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders
Werner Enterprises, Inc.:

     We have audited the accompanying consolidated balance sheets
of  Werner Enterprises, Inc. and subsidiaries (the Company) as of
December   31,  2008  and  2007,  and  the  related  consolidated
statements  of  income,  stockholders' equity  and  comprehensive
income,  and  cash flows for each of the years in the  three-year
period ended December 31, 2008.  In connection with our audits of
the  consolidated financial statements, we have also audited  the
financial statement schedule for each of the years in the  three-
year  period ended December 31, 2008, listed in Item 15(a)(2)  of
this  Form  10-K.   These consolidated financial  statements  and
financial  statement  schedule  are  the  responsibility  of  the
Company's  management.   Our  responsibility  is  to  express  an
opinion  on these consolidated financial statements and financial
statement schedule based on our audits.

     We  conducted our audits in accordance with the standards of
the  Public  Company Accounting Oversight Board (United  States).
Those  standards require that we plan and perform  the  audit  to
obtain   reasonable   assurance  about  whether   the   financial
statements are free of material misstatement.  An audit  includes
examining,  on a test basis, evidence supporting the amounts  and
disclosures in the financial statements.  An audit also  includes
assessing   the   accounting  principles  used  and   significant
estimates  made by management, as well as evaluating the  overall
financial  statement presentation.  We believe  that  our  audits
provide a reasonable basis for our opinion.

     In  our  opinion,  the  consolidated   financial  statements
referred  to above present fairly, in all material respects,  the
financial  position of Werner Enterprises, Inc. and  subsidiaries
as  of  December  31,  2008 and 2007, and the  results  of  their
operations  and  their cash flows for each of the  years  in  the
three-year  period  ended December 31, 2008, in  conformity  with
U.S.  generally  accepted  accounting principles.   Also  in  our
opinion,   the   related  financial  statement   schedule,   when
considered  in  relation  to  the  basic  consolidated  financial
statements  taken as a whole, presents fairly,  in  all  material
respects, the information set forth therein.

     We  also  have audited, in accordance with the standards  of
the  Public  Company Accounting Oversight Board (United  States),
Werner   Enterprises,  Inc.'s  internal  control  over  financial
reporting  as of December 31, 2008, based on criteria established
in   Internal  Control  -  Integrated  Framework  issued  by  the
Committee  of Sponsoring Organizations of the Treadway Commission
(COSO),  and  our  report dated February 27,  2009  expressed  an
unqualified  opinion  on  the  effectiveness  of  the   Company's
internal control over financial reporting.

                              KPMG LLP
Omaha, Nebraska
February 27, 2009

                                35
<PAGE>

                    WERNER ENTERPRISES, INC.
                CONSOLIDATED STATEMENTS OF INCOME
            (In thousands, except per share amounts)

<TABLE>
<CAPTION>

                                                    Years Ended December 31,
                                             --------------------------------------
                                                2008          2007          2006
                                             ----------    ----------    ----------

<S>                                          <C>           <C>           <C>
Operating revenues                           $2,165,599    $2,071,187    $2,080,555
                                             ----------    ----------    ----------

Operating expenses:
  Salaries, wages and benefits                  586,035       598,837       594,783
  Fuel                                          508,594       408,410       388,710
  Supplies and maintenance                      163,524       159,843       155,304
  Taxes and licenses                            109,443       117,170       117,570
  Insurance and claims                          104,349        93,769        92,580
  Depreciation                                  167,435       166,994       167,516
  Rent and purchased transportation             397,887       387,564       395,660
  Communications and utilities                   19,579        20,098        19,651
  Other                                          (4,182)      (18,015)      (15,720)
                                             ----------    ----------    ----------
     Total operating expenses                 2,052,664     1,934,670     1,916,054
                                             ----------    ----------    ----------

Operating income                                112,935       136,517       164,501
                                             ----------    ----------    ----------

Other expense (income):
  Interest expense                                   83         2,977         1,196
  Interest income                                (3,972)       (3,989)       (4,407)
  Other                                            (198)          247           319
                                             ----------    ----------    ----------
     Total other income                          (4,087)         (765)       (2,892)
                                             ----------    ----------    ----------

Income before income taxes                      117,022       137,282       167,393
Income taxes                                     49,442        61,925        68,750
                                             ----------    ----------    ----------

Net income                                   $   67,580    $   75,357    $   98,643
                                             ==========    ==========    ==========

Earnings per share:
  Basic                                      $     0.96    $     1.03    $     1.27
                                             ==========    ==========    ==========
  Diluted                                    $     0.94    $     1.02    $     1.25
                                             ==========    ==========    ==========

Weighted-average common shares outstanding:
  Basic                                          70,752        72,858        77,653
                                             ==========    ==========    ==========
  Diluted                                        71,658        74,114        79,101
                                             ==========    ==========    ==========

</TABLE>

The accompanying notes are an integral part of these consolidated
financial statements.

                                36
<PAGE>

                    WERNER ENTERPRISES, INC.
                   CONSOLIDATED BALANCE SHEETS
              (In thousands, except share amounts)

<TABLE>
<CAPTION>
                                                      December 31,
                                                ------------------------
                    ASSETS                         2008          2007
                                                ----------    ----------
<S>                                             <C>           <C>
Current assets:
  Cash and cash equivalents                     $   48,624    $   25,090
  Accounts receivable, trade, less allowance
     of $9,555 and $9,765, respectively            185,936       213,496
  Other receivables                                 18,739        14,587
  Inventories and supplies                          10,644        10,747
  Prepaid taxes, licenses, and permits              16,493        17,045
  Current deferred income taxes                     30,789        26,702
  Other current assets                              20,659        21,500
                                                ----------    ----------
     Total current assets                          331,884       329,167
                                                ----------    ----------
Property and equipment, at cost:
  Land                                              28,643        27,947
  Buildings and improvements                       125,631       121,788
  Revenue equipment                              1,281,688     1,284,418
  Service equipment and other                      177,140       171,292
                                                ----------    ----------
     Total property and equipment                1,613,102     1,605,445
     Less - accumulated depreciation               686,463       633,504
                                                ----------    ----------
                 Property and equipment, net       926,639       971,941
                                                ----------    ----------
Other non-current assets                            16,795        20,300
                                                ----------    ----------
                                                $1,275,318    $1,321,408
                                                ==========    ==========
     LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Accounts payable                              $   46,684    $   49,652
  Current portion of long-term debt                 30,000             -
  Insurance and claims accruals                     79,830        76,189
  Accrued payroll                                   25,850        21,753
  Other current liabilities                         19,006        19,395
                                                ----------    ----------
     Total current liabilities                     201,370       166,989
                                                ----------    ----------
Other long-term liabilities                          7,406        14,165
Deferred income taxes                              200,512       196,966
Insurance and claims accruals, net of current
  portion                                          120,500       110,500
Commitments and contingencies
Stockholders' equity:
  Common stock, $0.01 par value, 200,000,000
     shares authorized; 80,533,536
     shares issued; 71,576,267 and 70,373,189
     shares outstanding, respectively                  805           805
  Paid-in capital                                   93,343       101,024
  Retained earnings                                826,511       923,411
  Accumulated other comprehensive loss              (7,146)         (169)
  Treasury stock, at cost; 8,957,269 and
     10,160,347 shares, respectively              (167,983)     (192,283)
                                                ----------    ----------
     Total stockholders' equity                    745,530       832,788
                                                ----------    ----------
                                                $1,275,318    $1,321,408
                                                ==========    ==========

</TABLE>

The accompanying notes are an integral part of these consolidated
financial statements.

                                37
<PAGE>

                    WERNER ENTERPRISES, INC.
              CONSOLIDATED STATEMENTS OF CASH FLOWS
                         (In thousands)

<TABLE>
<CAPTION>

                                               Years Ended December 31,
                                        -------------------------------------
                                           2008          2007          2006
                                        ---------     ---------     ---------
<S>                                     <C>           <C>           <C>
Cash flows from operating activities:
  Net income                            $  67,580     $  75,357     $  98,643
  Adjustments to reconcile net
    income to net cash provided by
    operating activities:
    Depreciation                          167,435       166,994       167,516
    Deferred income taxes                  (5,685)       (8,571)        2,234
    Gain on disposal of operating
      equipment                            (9,896)      (22,915)      (28,393)
    Stock based compensation                1,455         1,878         2,258
    Other long-term assets                    631           918        (1,878)
    Insurance and claims accruals,
      net of current portion               10,000        11,000         4,500
    Other long-term liabilities              (194)          571           473
    Changes in certain working
      capital items:
      Accounts receivable, net             27,560        19,298         7,430
      Prepaid expenses and other
        current assets                     (2,656)        7,504        (1,498)
      Accounts payable                     (2,968)      (26,169)       23,434
      Accrued and other current
        liabilities                         5,868         2,120         9,346
                                        ---------     ---------     ---------
    Net cash provided by operating
      activities                          259,130       227,985       284,065
                                        ---------     ---------     ---------

Cash flows from investing activities:
  Additions to property and equipment    (206,305)     (133,124)     (400,548)
  Retirements of property and equipment    85,324       107,056       158,727
  Decrease in notes receivable              5,615         5,962         5,574
                                        ---------     ---------     ---------
  Net cash used in investing
    activities                           (115,366)      (20,106)     (236,247)
                                        ---------     ---------     ---------

Cash flows from financing activities:
  Proceeds from issuance of short-term
    debt                                   30,000             -             -
  Proceeds from issuance of long-term
    debt                                        -        10,000       100,000
  Repayments of short-term debt                 -       (30,000)      (60,000)
  Repayments of long-term debt                  -       (80,000)            -
  Dividends on common stock              (164,420)      (13,953)      (13,287)
  Repurchases of common stock              (4,486)     (113,821)      (85,132)
  Stock options exercised                  13,624         8,789         3,377
  Excess tax benefits from exercise
    of stock options                        6,026         4,545         2,202
                                        ---------     ---------     ---------
    Net cash used in financing
      activities                         (119,256)     (214,440)      (52,840)
                                        ---------     ---------     ---------

Effect of exchange rate fluctuations
  on cash                                    (974)           38            52
Net increase (decrease) in cash and
  cash equivalents                         23,534        (6,523)       (4,970)
Cash and cash equivalents, beginning
  of year                                  25,090        31,613        36,583
                                        ---------     ---------     ---------
Cash and cash equivalents, end of
  year                                  $  48,624     $  25,090     $  31,613
                                        =========     =========     =========
Supplemental disclosures of cash flow
  information:
  Cash paid during year for:
         Interest                       $      28     $   3,717     $     566
         Income taxes                      53,562        65,111        68,941
Supplemental disclosures of  non-cash
  investing activities:
  Notes receivable issued upon  sale
    of revenue equipment                $   2,741     $   6,388     $   8,965

</TABLE>

The accompanying notes are an integral part of these consolidated
financial statements.

                                38
<PAGE>

                     WERNER ENTERPRISES, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY AND COMPREHENSIVE
                             INCOME
       (In thousands, except share and per share amounts)

<TABLE>
<CAPTION>


                                                                  Accumulated
                                                                     Other                        Total
                                Common    Paid-In    Retained    Comprehensive    Treasury    Stockholders'
                                 Stock    Capital    Earnings    Income (Loss)     Stock          Equity
                               ----------------------------------------------------------------------------
<S>                              <C>     <C>         <C>            <C>          <C>             <C>
BALANCE, December 31, 2005       $805    $105,074    $777,260       $  (259)     $ (20,429)      $862,451

Purchases of 4,500,000 shares
 of common stock                    -           -           -             -        (85,132)       (85,132)
Dividends on common stock
 ($.175 per share)                  -           -     (13,500)            -              -        (13,500)
Exercise of stock options,
 418,854 shares, including tax
 benefits                           -      (2,139)          -             -          7,718          5,579
Stock-based compensation
 expense                            -       2,258           -             -              -          2,258
Comprehensive income (loss):
 Net income                         -           -      98,643             -              -         98,643
 Foreign currency translation
   adjustments                      -           -           -            52              -             52
                               ------    --------    --------       -------      ---------       --------
 Total comprehensive
   income (loss)                    -           -      98,643            52              -         98,695
                               ------    --------    --------       -------      ---------       --------

BALANCE, December 31, 2006        805     105,193     862,403          (207)       (97,843)       870,351

Purchases of 6,000,000 shares
 of common stock                    -           -           -             -       (113,821)      (113,821)
Dividends on common stock
 ($.195 per share)                  -           -     (14,081)            -              -        (14,081)
Exercise of stock options,
 1,033,892 shares, including
 excess tax benefits                -      (6,047)          -             -         19,381         13,334
Stock-based compensation
 expense                            -       1,878           -             -              -          1,878
Adoption of FIN 48                  -           -        (268)            -              -           (268)
Comprehensive income (loss):
 Net income                         -           -      75,357             -              -         75,357
 Foreign currency translation
   adjustments                      -           -           -            38              -             38
                               ------    --------    --------       -------      ---------       --------
 Total comprehensive
   income (loss)                    -           -      75,357            38              -         75,395
                               ------    --------    --------       -------      ---------       --------

BALANCE, December 31, 2007        805     101,024     923,411          (169)      (192,283)       832,788

Purchases of 250,000 shares
 of common stock                    -           -           -             -         (4,486)        (4,486)
Dividends on common stock
 ($2.300 per share)                 -           -    (164,480)            -              -       (164,480)
Exercise of stock options,
 1,453,078 shares, including
 excess tax benefits                -      (9,136)          -             -         28,786         19,650
Stock-based compensation
 expense                            -       1,455           -             -              -          1,455
Comprehensive income (loss):
 Net income                         -           -      67,580             -              -         67,580
 Foreign currency translation
   adjustments                      -           -           -        (6,977)             -         (6,977)
                               ------    --------    --------       -------      ---------       --------
 Total comprehensive
   income (loss)                    -           -      67,580        (6,977)             -         60,603
                               ------    --------    --------       -------      ---------       --------

BALANCE, December 31, 2008       $805    $ 93,343    $826,511       $(7,146)     $(167,983)      $745,530
                               ======    ========    ========       =======      =========       ========

</TABLE>

The accompanying notes are an integral part of these consolidated
financial statements.

                                39
<PAGE>

                    WERNER ENTERPRISES, INC.
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(1)  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Business

     Werner  Enterprises, Inc.  (the "Company")  is  a  truckload
transportation   and  logistics  company  operating   under   the
jurisdiction  of  the  U.S.  Department  of  Transportation,  the
federal and provincial Transportation Departments in Canada,  the
Secretary  of  Communication  and Transportation  in  Mexico  and
various  U.S.  state  regulatory  commissions.   We  maintain   a
diversified  freight  base and are not dependent  on  a  specific
industry   for   a   majority  of  our  freight,   which   limits
concentrations of credit risk.  No customer generated  more  than
10%  of  total  revenues  in  2008 and  2007,  and  one  customer
generated 11% in 2006.

Principles of Consolidation

     The  accompanying  consolidated financial statements include
the  accounts  of Werner Enterprises, Inc. and our majority-owned
subsidiaries.    All   significant  intercompany   accounts   and
transactions relating to these majority-owned entities have  been
eliminated.

Use of Management Estimates

     The  preparation  of  consolidated financial  statements  in
conformity with accounting principles generally accepted  in  the
United  States  of America requires management to make  estimates
and  assumptions that affect the (i) reported amounts  of  assets
and   liabilities  and  disclosure  of  contingent   assets   and
liabilities at the date of the consolidated financial  statements
and  (ii)  reported amounts of revenues and expenses  during  the
reporting  period.   Actual  results  could  differ  from   those
estimates.

Cash and Cash Equivalents

     We  consider all highly liquid investments, purchased with a
maturity of three months or less, to be cash equivalents.

Trade Accounts Receivable

     We record trade accounts receivable at the invoiced amounts,
net  of  an  allowance for doubtful accounts.  The allowance  for
doubtful  accounts  is  our estimate of the  amount  of  probable
credit losses in our existing accounts receivable.  We review the
financial   condition  of  customers  for  granting  credit   and
determine  the allowance based on historical write-off experience
and  national economic conditions.  We evaluate the  adequacy  of
our allowance for doubtful accounts quarterly.  Past due balances
over  90  days  and  exceeding a specified  amount  are  reviewed
individually  for collectibility.  Account balances  are  charged
off against the allowance after all means of collection have been
exhausted  and  the potential for recovery is considered  remote.
We  do not have any off-balance-sheet credit exposure related  to
our customers.

Inventories and Supplies

     Inventories  and supplies are stated at the lower of average
cost  or market and consist primarily of revenue equipment parts,
tires,  fuel,  supplies  and company  store  merchandise.   Tires
placed on new revenue equipment are capitalized as a part of  the
equipment  cost.  Replacement tires are expensed when  placed  in
service.

                                40
<PAGE>

Property, Equipment, and Depreciation

     Additions  and  improvements to property and  equipment  are
capitalized  at  cost, while maintenance and repair  expenditures
are  charged to operations as incurred.  Gains and losses on  the
sale  or  exchange of equipment are recorded in  other  operating
expenses.

     Depreciation  is calculated based on the cost of the  asset,
reduced  by  the  asset's  estimated  salvage  value,  using  the
straight-line method.  Accelerated depreciation methods are  used
for  income tax purposes.  The lives and salvage values  assigned
to  certain assets for financial reporting purposes are different
than  for income tax purposes.  For financial reporting purposes,
assets are depreciated using the following estimated useful lives
and salvage values:

<TABLE>
<CAPTION>

                                         Lives       Salvage Values
                                      -----------  ------------------
        <S>                           <C>               <C>
        Building and improvements      30 years           0%
        Tractors                        5 years          25%
        Trailers                       12 years         $1,000
        Service and other equipment   3-10 years          0%

</TABLE>

     Although  our normal replacement cycle for tractors is three
years,  we calculate depreciation expense for financial reporting
purposes   using   a  five-year  life  and  25%  salvage   value.
Depreciation expense calculated in this manner continues  at  the
same   straight-line  rate  (which  approximates  the  continuing
declining  value of the tractors) when a tractor is  held  beyond
the  normal  three-year  age.  Calculating  depreciation  expense
using a five-year life and 25% salvage value results in the  same
annual depreciation rate (15% of cost per year) and the same  net
book  value  at the normal three-year replacement  date  (55%  of
cost)  as  using a three-year life and 55% salvage value.   As  a
result,  there is no difference in recorded depreciation  expense
on  a  quarterly or annual basis with our five-year life and  25%
salvage  value, as compared to a three-year life and 55%  salvage
value.

Long-Lived Assets

     We  review  our  long-lived  assets for impairment  whenever
events  or circumstances indicate the carrying amount of a  long-
lived asset may not be recoverable.  An impairment loss would  be
recognized if the carrying amount of the long-lived asset is  not
recoverable and the carrying amount exceeds its fair value.   For
long-lived  assets  classified as held  and  used,  the  carrying
amount  is  not recoverable when the carrying value of the  long-
lived asset exceeds the sum of the future net cash flows.  We  do
not  separately  identify  assets by  operating  segment  because
tractors   and  trailers  are  routinely  transferred  from   one
operating  fleet to another.  As a result, none of our long-lived
assets  have  identifiable cash flows from use that  are  largely
independent  of  the cash flows of other assets and  liabilities.
Thus, the asset group used to assess impairment would include all
of our assets.

Insurance and Claims Accruals

     Insurance  and claims accruals (both current and noncurrent)
reflect  the estimated cost (including estimated loss development
and loss adjustment expenses) for (i) cargo loss and damage, (ii)
bodily  injury and property damage, (iii) group health  and  (iv)
workers' compensation claims not covered by insurance.  The costs
for cargo, bodily injury and property damage insurance and claims
are  included in insurance and claims expense in the Consolidated
Statements  of  Income; the costs of group  health  and  workers'
compensation claims are included in salaries, wages and  benefits
expense.  The insurance and claims accruals are recorded  at  the
estimated  ultimate payment amounts.  Such insurance  and  claims
accruals  are  based  upon individual case  estimates  (including
negative  development) and estimates of incurred-but-not-reported
losses using loss development factors based upon past experience.
Actual  costs  related to insurance and claims have not  differed
materially   from  estimated  accrued  amounts  for   all   years
presented.   An actuary reviews our self-insurance  reserves  for
bodily   injury   and   property  damage  claims   and   workers'
compensation claims every six months.

     We  were  responsible  for liability claims up to  $500,000,
plus  administrative  expenses,  for  each  occurrence  involving
bodily  injury or property damage since August 1, 1992.  For  the
policy  year  beginning August 1, 2004, we  increased  our  self-

                                41
<PAGE>

insured  retention ("SIR") and deductible amount to $2.0  million
per  occurrence.   We  are also responsible  for  varying  annual
aggregate  amounts  of  liability for claims  in  excess  of  the
SIR/deductible.  The following table reflects the  SIR/deductible
levels  and aggregate amounts of liability for bodily injury  and
property damage claims since August 1, 2005:

<TABLE>
<CAPTION>
                                                       Primary Coverage
         Coverage Period           Primary Coverage     SIR/Deductible
--------------------------------  ------------------  ------------------
 <S>                                 <C>               <C>
 August 1, 2005 - July 31, 2006      $5.0 million      $2.0 million (1)
 August 1, 2006 - July 31, 2007      $5.0 million      $2.0 million (1)
 August 1, 2007 - July 31, 2008      $5.0 million      $2.0 million (2)
 August 1, 2008 - July 31, 2009      $5.0 million      $2.0 million (3)

</TABLE>

 (1) Subject to an  additional $2.0 million aggregate in the $2.0
 to $3.0 million layer, no  aggregate (meaning that we were fully
 insured) in the $3.0  to $5.0 million layer,  and a $5.0 million
 aggregate in the $5.0 to $10.0 million layer.

 (2) Subject to an additional $8.0  million aggregate in the $2.0
 to $5.0  million layer and a $5.0  million aggregate in the $5.0
 to $10.0 million layer.

 (3) Subject to an additional  $8.0 million aggregate in the $2.0
 to  $5.0 million layer and  a $4.0 million aggregate in the $5.0
 to  $10.0 million layer.

     Our  primary  insurance covers the range of liability  under
which  we  expect most claims to occur.  If any liability  claims
are  substantially in excess of coverage amounts  listed  in  the
table above, such claims are covered under premium-based policies
(issued  by  insurance  companies) to coverage  levels  that  our
management  considers  adequate.  We  are  also  responsible  for
administrative  expenses  for  each occurrence  involving  bodily
injury or property damage.

     We  assumed  responsibility for workers' compensation up  to
$1.0  million per claim.  Effective April 2007, we were no longer
responsible for the additional $1.0 million aggregate for  claims
between  $1.0 million and $2.0 million.  For the years  2005  and
2006  we were responsible for a $1.0 million aggregate for claims
between $1.0 million and $2.0 million.  We also maintain a  $26.3
million  bond and obtained insurance for individual claims  above
$1.0 million.

     Under  these  insurance  arrangements,  we   maintain  $43.9
million in letters of credit as of December 31, 2008.

Revenue Recognition

     The Consolidated Statements of Income reflect recognition of
operating  revenues  (including  fuel  surcharge  revenues)   and
related  direct  costs  when  the  shipment  is  delivered.   For
shipments where a third-party capacity provider (including owner-
operators under contract with us) is utilized to provide some  or
all  of  the service and we (i) are the primary obligor in regard
to   the  shipment  delivery,  (ii)  establish  customer  pricing
separately  from carrier rate negotiations, (iii) generally  have
discretion in carrier selection and/or (iv) have credit  risk  on
the  shipment,  we record both revenues for the dollar  value  of
services   we  bill  to  the  customer  and  rent  and  purchased
transportation expense for transportation costs  we  pay  to  the
third-party  provider  upon  the  shipment's  delivery.   In  the
absence of the conditions listed above, we record revenues net of
those expenses related to third-party providers.

Foreign Currency Translation

     Local  currencies  are generally considered  the  functional
currencies outside the United States.  Assets and liabilities are
translated  at  year-end exchange rates for operations  in  local
currency environments.  Most foreign revenues are denominated  in
U.S.  Dollars.  Expense items are translated at the average rates
of   exchange  prevailing  during  the  year.   Foreign  currency
translation  adjustments reflect the changes in foreign  currency
exchange  rates  applicable  to the net  assets  of  the  foreign
operations for the years ended December 31, 2008, 2007 and  2006.
Foreign  currency transaction losses were $7.0 million  for  2008
and  are recorded in accumulated other comprehensive loss  within
stockholders' equity in the Consolidated Balance Sheets.  Amounts
for 2007 and 2006 were not material.

                                42
<PAGE>

Income Taxes

     We  use  the  asset  and liability method  of  Statement  of
Financial  Accounting Standards ("SFAS") No. 109, Accounting  for
Income Taxes, in accounting for income taxes.  Under this method,
deferred tax assets and liabilities are recognized for the future
tax  consequences  attributable to temporary differences  between
the  financial statement carrying amounts of existing assets  and
liabilities and their respective tax bases.  Deferred tax  assets
and liabilities are measured using the enacted tax rates that are
expected  to apply to taxable income in the years in which  those
temporary differences are expected to be recovered or settled.

Common Stock and Earnings Per Share

     We compute and present earnings per share in accordance with
SFAS  No.  128, Earnings per Share.  Basic earnings per share  is
computed by dividing net income by the weighted average number of
common  shares  outstanding during the period.  Diluted  earnings
per  share  is  computed by dividing net income by  the  weighted
average  number  of  common shares plus the  effect  of  dilutive
potential  common shares outstanding during the period using  the
treasury stock method.  Dilutive potential common shares  include
outstanding  stock  options  and  stock  awards.   There  are  no
differences  in the numerators of our computations of  basic  and
diluted  earnings  per  share  for any  periods  presented.   The
computation  of  basic and diluted earnings per  share  is  shown
below (in thousands, except per share amounts).


<TABLE>
<CAPTION>

                                      Years Ended December 31,
                                   ------------------------------
                                     2008       2007       2006
                                   --------   --------   --------
     <S>                           <C>        <C>        <C>
     Net income                    $ 67,580   $ 75,357   $ 98,643
                                   ========   ========   ========

     Weighted average common
       shares outstanding            70,752     72,858     77,653
     Common stock equivalents           906      1,256      1,448
                                   --------   --------   --------
     Shares used in computing
       diluted earnings per share    71,658     74,114     79,101
                                   ========   ========   ========

     Basic earnings per share      $    .96   $   1.03   $   1.27
                                   ========   ========   ========
     Diluted earnings per share    $    .94   $   1.02   $   1.25
                                   ========   ========   ========

</TABLE>

     Options  to  purchase  shares  of  common  stock  that  were
outstanding during the periods indicated above, but were excluded
from  the  computation of diluted earnings per share because  the
option  purchase price was greater than the average market  price
of the common shares, were:

<TABLE>
<CAPTION>

                                                Years Ended December 31,
                                      --------------------------------------------
                                          2008            2007            2006
                                      ------------   -------------   -------------
   <S>                                <C>            <C>             <C>
   Number of shares under option            23,600          29,500          24,500
   Ranges of option purchase prices   $19.84-20.36   $ 19.26-20.36   $ 19.84-20.36

</TABLE>

Comprehensive Income

     Comprehensive  income  consists  of  net  income  and  other
comprehensive  income (loss).  Other comprehensive income  (loss)
refers  to  revenues,  expenses, gains and losses  that  are  not
included  in  net  income, but rather are  recorded  directly  in
stockholders'  equity.  For the years ended  December  31,  2008,
2007,  and 2006, comprehensive income consists of net income  and
foreign currency translation adjustments.

Accounting Standards

     In  September 2006, the FASB issued SFAS No. 157, Fair Value
Measurements  ("No.  157").  This statement defines  fair  value,
establishes  a  framework for measuring fair value  in  generally
accepted accounting principles and expands disclosures about fair
value  measurements.  SFAS No. 157 does not require any new  fair
value  measurements  but  rather  eliminates  inconsistencies  in
guidance found in various prior accounting pronouncements and was

                                43
<PAGE>

effective for fiscal years beginning after November 15, 2007.  In
February  2008,  the  FASB issued FASB Staff Position  No.  157-2
("FSP  No. 157-2").  FSP No. 157-2 delays the effective  date  of
SFAS  No.  157  for  all  nonfinancial  assets  and  nonfinancial
liabilities,  except those that are recognized  or  disclosed  at
fair  value in the financial statements on a recurring basis  (at
least annually), until fiscal years beginning after November  15,
2008  and  interim  periods  within those  fiscal  years.   These
nonfinancial  items  include  assets  and  liabilities  such   as
reporting units measured at a fair value in a goodwill impairment
test and nonfinancial assets acquired and liabilities assumed  in
a  business  combination.  Effective January 1, 2008, we  adopted
SFAS  No. 157 for financial assets and liabilities recognized  at
fair  value on a recurring basis.  The partial adoption  of  SFAS
No. 157 for financial assets and liabilities had no effect on our
financial position, results of operations and cash flows.  As  of
December  31, 2008, management believes that fully adopting  SFAS
No.  157  will  not  have  a  material effect  on  our  financial
position, results of operations and cash flows.

     In  February  2007, the FASB issued SFAS No. 159,  The  Fair
Value  Option  for  Financial Assets and  Financial  Liabilities-
Including  an  amendment of FASB Statement No. 115  ("No.  159").
This  statement  permits  entities  to  choose  to  measure  many
financial instruments and certain other items at fair value.  The
provisions of SFAS No. 159 were effective as of the beginning  of
the  first fiscal year that begins after November 15, 2007.  Upon
adoption,  SFAS No. 159 had no effect on our financial  position,
results of operations and cash flows.

     In  December  2007, the FASB issued SFAS  No.  141  (revised
2007),   Business  Combinations  ("No.  141R").  This   statement
establishes requirements for (i) recognizing and measuring in  an
acquiring company's financial statements the identifiable  assets
acquired,   the   liabilities  assumed,  and  any  noncontrolling
interest  in  the  acquiree, (ii) recognizing and  measuring  the
goodwill  acquired in the business combination or a gain  from  a
bargain  purchase  and  (iii)  determining  what  information  to
disclose  to enable users of the financial statements to evaluate
the  nature  and  financial effects of the business  combination.
The  provisions  of  SFAS  No. 141R are  effective  for  business
combinations  for which the acquisition date is on or  after  the
beginning  of the first annual reporting period beginning  on  or
after  December  15, 2008.  As of December 31,  2008,  management
believes  that SFAS No. 141R will not have a material  effect  on
our financial position, results of operations and cash flows.

     In   December   2007,  the  FASB  issued   SFAS   No.   160,
Noncontrolling Interests in Consolidated Financial  Statements-an
amendment  of  ARB  No.  51 ("No. 160").  This  statement  amends
Accounting  Research Bulletin No. 51 to establish accounting  and
reporting  standards  for  the  noncontrolling  interest   in   a
subsidiary  and  for the deconsolidation of  a  subsidiary.   The
provisions  of SFAS No. 160 are effective for fiscal  years,  and
interim periods within those fiscal years, beginning on or  after
December  15, 2008.  As of December 31, 2008, management believes
that  SFAS  No.  160  will  not have a  material  effect  on  our
financial position, results of operations and cash flows.

     In  March  2008,  the FASB issued SFAS No. 161,  Disclosures
about  Derivative Instruments and Hedging Activities-an amendment
of  FASB  Statement No. 133 ("No. 161").  This  statement  amends
FASB  Statement No. 133 to require enhanced disclosures about  an
entity's  derivative and hedging activities.  The  provisions  of
SFAS  No. 161 are effective for fiscal years, and interim periods
within  those  fiscal years, beginning on or after  November  15,
2008.  As of December 31, 2008, management believes that SFAS No.
161  will  not have a material effect on our financial  position,
results of operations and cash flows.

     In  May 2008, the FASB issued SFAS No. 162, The Hierarchy of
Generally  Accepted  Accounting  Principles  ("No.  162").   This
statement  identifies the sources of and framework for  selecting
the  accounting  principles  to be used  in  the  preparation  of
financial  statements  of  nongovernmental  entities   that   are
presented   in  conformity  with  generally  accepted  accounting
principles  ("GAAP")  in  the United States  ("GAAP  hierarchy").
Because  the current GAAP hierarchy is set forth in the  American
Institute  of Certified Public Accountants Statement on  Auditing
Standards  No. 69, it is directed to the auditor rather  than  to
the  entity  responsible for selecting accounting principles  for
financial   statements   presented  in  conformity   with   GAAP.
Accordingly, the FASB concluded the GAAP hierarchy should  reside

                                44
<PAGE>

in  the  accounting literature established by the FASB and issued
this  statement to achieve that result.  The provisions  of  SFAS
No.  162 became effective on November 15, 2008, which was 60 days
following the U.S. Securities and Exchange Commission's  approval
of the Public Company Accounting Oversight Board amendments to AU
Section  411,  The Meaning of Present Fairly in  Conformity  with
Generally  Accepted Accounting Principles.  Upon  adoption,  SFAS
No.  162 had no effect on our current accounting practices or  on
our financial position, results of operations and cash flows.

(2)  LONG-TERM DEBT

     Long-term debt consisted of the following at December 31 (in
thousands):

<TABLE>
<CAPTION>

                                          2008        2007
                                        --------   ---------
       <S>                              <C>        <C>
       Notes payable to banks under
         committed credit facilities    $ 30,000   $       -
                                        --------   ---------
                                          30,000           -
       Less current portion               30,000           -
                                        --------   ---------
       Long-term debt, net              $      -   $       -
                                        ========   =========

</TABLE>

     As  of  December  31,  2008  we have  two  committed  credit
facilities with banks totaling $225.0 million that mature in  May
2009  ($50.0 million) and May 2011 ($175.0 million).   Borrowings
under  these  credit facilities bear variable interest  (2.0%  at
December  31,  2008) based on the London Interbank  Offered  Rate
("LIBOR").   As  of  December 31, 2008,  we  had  borrowed  $30.0
million  under these credit facilities with banks.  During  first
quarter  2009, we repaid the total $30.0 million on these  notes.
The $225.0 million of credit available under these facilities  is
further reduced by $43.9 million in letters of credit under which
we  are  obligated.  Each of the debt agreements includes,  among
other  things, two financial covenants requiring us  (i)  not  to
exceed a maximum ratio of total debt to total capitalization  and
(ii)  not  to  exceed  a maximum ratio of total  funded  debt  to
earnings    before   interest,   income   taxes,    depreciation,
amortization  and  rentals payable (as  defined  in  each  credit
facility).   We  were  in  compliance  with  these  covenants  at
December 31, 2008.

     The carrying amounts of our long-term debt approximates fair
value due to the duration of the notes and the interest rates.

(3)  NOTES RECEIVABLE

     Notes  receivable  are included in other current assets  and
other non-current assets in the Consolidated Balance Sheets.   At
December  31,  notes receivable consisted of  the  following  (in
thousands):

<TABLE>
<CAPTION>

                                           2008       2007
                                         --------   --------
       <S>                               <C>        <C>
       Owner-operator notes receivable   $  9,392   $ 13,177
       TDR Transportes, S.A. de C.V.        3,600      3,600
       Other notes receivable               5,046      5,124
                                         --------   --------
                                           18,038     21,901
       Less current portion                 4,085      5,074
                                         --------   --------
       Notes receivable - non-current    $ 13,953   $ 16,827
                                         ========   ========

</TABLE>

     We  provide  financing  to some independent contractors  who
want  to  become owner-operators by purchasing a tractor from  us
and  leasing their truck to us.  At December 31, 2008, we had 232
notes  receivable from these owner-operators and at December  31,
2007,  we  had  307  such  notes  receivable.   See  Note  7  for
information regarding notes from related parties.  We maintain  a
primary security interest in the tractor until the owner-operator
pays  the note balance in full.  We also retain recourse exposure
related  to owner-operators who purchased tractors from  us  with
third-party financing we arranged.

                                45
<PAGE>

     During 2002, we loaned $3.6 million to TDR Transportes, S.A.
de  C.V.  ("TDR"), a truckload carrier in the Republic of Mexico.
The  loan has a nine-year term with principal payable at the  end
of the term.  Such loan (i) is subject to acceleration if certain
conditions are met, (ii) bears interest at a rate of 5% per annum
(which  is  payable quarterly), (iii) contains certain  financial
and  other covenants and (iv) is collateralized by the assets  of
TDR. We had a receivable for interest on this note of $31,000  as
of  December  31,  2008  and 2007.  See Note  7  for  information
regarding related party transactions.

(4)  INCOME TAXES

     Income   tax   expense  consisted  of  the   following   (in
thousands):

<TABLE>
<CAPTION>

                                     2008        2007        2006
                                   --------    --------    --------
      <S>                          <C>         <C>         <C>
      Current:
        Federal                    $ 47,575    $ 62,026    $ 59,021
        State                         7,552       8,470       7,495
                                   --------    --------    --------
                                     55,127      70,496      66,516
                                   --------    --------    --------
      Deferred:
        Federal                      (3,735)     (6,698)      1,149
        State                        (1,950)     (1,873)      1,085
                                   --------    --------    --------
                                     (5,685)     (8,571)      2,234
                                   --------    --------    --------
      Total income tax expense     $ 49,442    $ 61,925    $ 68,750
                                   ========    ========    ========

</TABLE>

     The  effective  income  tax rate differs  from  the  federal
corporate  tax rate of 35% in 2008, 2007 and 2006 as follows  (in
thousands):

<TABLE>
<CAPTION>

                                      2008        2007        2006
                                    --------    --------    --------
      <S>                           <C>         <C>         <C>
      Tax at statutory rate         $ 40,958    $ 48,049    $ 58,588
      State income taxes, net of
        federal tax benefits           3,641       4,288       5,577
      Non-deductible meals and
        entertainment                  4,158       4,799       4,329
      Income tax settlement                -       4,000           -
      Income tax credits                (752)       (790)       (740)
      Other, net                       1,437       1,579         996
                                    --------    --------    --------
                                    $ 49,442    $ 61,925    $ 68,750
                                    ========    ========    ========

</TABLE>

     At   December   31,  deferred  tax  assets  and  liabilities
consisted of the following (in thousands):

<TABLE>
<CAPTION>

                                                   2008         2007
                                                ---------    ---------
        <S>                                     <C>          <C>
        Deferred tax assets:
        Insurance and claims accruals           $  78,901    $  73,276
        Allowance for uncollectible accounts        5,175        4,777
        Other                                       8,280        9,226
                                                ---------    ---------
          Gross deferred tax assets                92,356       87,279
                                                ---------    ---------

        Deferred tax liabilities:
        Property and equipment                    252,609      247,133
        Prepaid expenses                            7,290        7,693
        Other                                       2,180        2,717
                                                ---------    ---------
          Gross deferred tax liabilities          262,079      257,543
                                                ---------    ---------
          Net deferred tax liability            $ 169,723    $ 170,264
                                                =========    =========

</TABLE>

                                46
<PAGE>

     These   amounts   (in  thousands)  are  presented   in   the
accompanying  Consolidated Balance Sheets as of  December  31  as
follows:

<TABLE>
<CAPTION>

                                               2008         2007
                                             ---------    ---------
        <S>                                  <C>          <C>
        Current deferred tax asset           $  30,789    $  26,702
        Noncurrent deferred tax liability      200,512      196,966
                                             ---------    ---------
        Net deferred tax liability           $ 169,723    $ 170,264
                                             =========    =========

</TABLE>

     We  have  not  recorded  a valuation  allowance  because  we
believe that all deferred tax assets are more likely than not  to
be  realized as a result of our historical profitability, taxable
income and reversal of deferred tax liabilities.

     During  first quarter 2006, in connection with an  audit  of
our  federal  income tax returns for the years 1999 to  2002,  we
received  a  notice  from  the Internal Revenue  Service  ("IRS")
proposing   to  disallow  a  significant  tax  deduction.    This
deduction  was  based  on a timing difference  between  financial
reporting and tax reporting and would result in interest charges,
which  we  record  as a component of income tax  expense  in  the
Consolidated  Statements  of  Income.   This  timing   difference
deduction  reversed in our 2004 income tax return.   We  formally
protested this matter in April 2006.  During fourth quarter 2007,
we  reached a tentative settlement agreement with an IRS  appeals
officer.  During fourth quarter 2007, we also accrued  in  income
tax   expense  in  our  Consolidated  Statements  of  Income  the
estimated   cumulative  interest  charges  for  the   anticipated
settlement of this matter, net of income taxes, which amounted to
$4.0  million,  or $0.05 per share.  During second quarter  2008,
the  appeals  officer  received  the  concurrence  of  the  Joint
Committee  of  Taxation with regard to the recommended  basis  of
settlement.   The  IRS  finalized  the  settlement  during  third
quarter  2008,  and we paid the federal accrued interest  at  the
beginning  of  October  2008.   We filed  amended  state  returns
reporting the IRS settlement changes to the states where required
during fourth quarter 2008.  We are now working with those states
to  settle  our  state interest liabilities.  Our total  payments
during  2008,  before  considering  the  tax  benefit  from   the
deductibility  of these payments, were $4.9 million  for  federal
and  $0.4  million to various states.  We expect to pay about  $1
million to settle the remaining state liabilities.

     We  adopted  the provisions of FASB Interpretation  No.  48,
Accounting  for Uncertainty in Income Taxes-an Interpretation  of
FASB  Statement No. 109 ("FIN 48"), on January  1,  2007.   As  a
result  of  the  adoption of FIN 48, we recognized an  additional
$0.3  million net liability for unrecognized tax benefits,  which
was  accounted  for as a reduction of retained  earnings.   After
recognizing  the  additional liability,  we  had  a  total  gross
liability for unrecognized tax benefits of $5.3 million as of the
adoption date, which was included in other long-term liabilities.
If  recognized, $3.4 million of unrecognized tax benefits  as  of
the  adoption date would impact our effective tax rate.  Interest
of  $1.4  million has been reflected as a component of the  total
liability as of the adoption date.  It is our policy to recognize
as  additional  income  tax expense the  items  of  interest  and
penalties directly related to income taxes.

     We  recognized a $3.8 million decrease in the net  liability
for  unrecognized  tax benefits for the year ended  December  31,
2008  and  a $4.4 million increase in the net liability  for  the
year  ended  December 31, 2007. The 2008 decrease is due  to  the
settlement with the IRS and related payment of interest and taxes
for tax years 1999 through 2002, as discussed above.   We accrued
an  interest  benefit of $4.9 million during  2008  and  interest
expense  of $7.2 million during 2007.  Our total gross  liability
for  unrecognized  tax  benefits at December  31,  2008  is  $7.4
million  and  at  December  31,  2007  was  $12.6  million.    If
recognized,  $4.0  million of unrecognized  tax  benefits  as  of
December 31, 2008 and $7.8 million as of December 31, 2007  would
impact  our effective tax rate.  Interest of $3.7 million  as  of
December  31, 2008 and $8.6 million as of December 31,  2007  has
been reflected as a component of the total liability.  We do  not
expect any other significant increases or decreases for uncertain
tax positions during the next twelve months.

                                47
<PAGE>

     The  reconciliations of beginning and ending gross  balances
of  unrecognized tax benefits for 2008 and 2007 are  shown  below
(in thousands).

<TABLE>
<CAPTION>

                                                             2008        2007
                                                           --------    --------
        <S>                                                <C>         <C>
        Unrecognized tax benefits, opening balance         $ 12,594    $  5,338
        Gross increases - tax positions in prior period         635       7,256
        Gross decreases - tax positions in prior period           -           -
        Gross increases - current-period tax positions            -           -
        Settlements                                          (5,779)          -
        Lapse of statute of limitations                           -           -
                                                           --------    --------
        Unrecognized tax benefits, ending balance          $  7,450    $ 12,594
                                                           ========    ========

</TABLE>

     We  file U.S. federal income tax returns, as well as  income
tax  returns in various states and several foreign jurisdictions.
The  IRS has completed its audits for tax years through 2005, and
all  resulting adjustments as discussed above have been  settled.
The IRS completed its audit of our 2005 federal income tax return
and in 2008, issued a "no change letter" for tax year 2005, under
which  the IRS did not propose any adjustment to the tax  return.
The  years 2006 through 2008 are open for examination by the IRS,
and  various years are open for examination by state and  foreign
tax  authorities.   State  and foreign jurisdiction  statutes  of
limitations generally range from three to four years.

(5)  EQUITY COMPENSATION AND EMPLOYEE BENEFIT PLANS

Equity Plan

     Our  Equity  Plan provides for grants of nonqualified  stock
options,  restricted  stock and stock appreciation  rights.   The
Board of Directors or the Compensation Committee of our Board  of
Directors  determine the terms of each award, including  type  of
award,  recipients, number of shares subject to  each  award  and
vesting  conditions of each award.  Stock option  and  restricted
stock   awards   are  described  below.   No  awards   of   stock
appreciation rights have been issued to date.  The maximum number
of  shares  of common stock that may be awarded under the  Equity
Plan  is  20,000,000  shares.  The maximum  aggregate  number  of
shares  that  may be awarded to any one person under  the  Equity
Plan is 2,562,500.  As of December 31, 2008, there were 8,669,682
shares available for granting additional awards.

     Effective January 1, 2006, we adopted SFAS No. 123  (Revised
2004), Share-Based Payment ("No. 123R"), using a modified version
of  the  prospective  transition method.  Under  this  transition
method,  compensation cost is recognized on or after  January  1,
2006  for  (i)  the portion of outstanding awards that  were  not
vested as of January 1, 2006, based on the grant-date fair  value
of  those  awards calculated under SFAS No. 123,  Accounting  for
Stock-Based  Compensation  (as  originally  issued),  for  either
recognition  or  pro forma disclosures and (ii)  all  share-based
payments granted on or after January 1, 2006, based on the grant-
date  fair value of those awards calculated under SFAS No.  123R.
Stock-based  employee compensation expense was  $1.5  million  in
2008, $1.9 million in 2007 and $2.3 million in 2006.  Stock-based
employee compensation expense is included in salaries, wages  and
benefits within the Consolidated Statements of Income.  The total
income  tax benefit recognized in the Consolidated Statements  of
Income for stock-based compensation arrangements was $0.6 million
in  2008,  $0.8 million in 2007 and $0.9 million in 2006.   There
was no cumulative effect of initially adopting SFAS No. 123R.  As
of  December  31, 2008, the total unrecognized compensation  cost
related   to   nonvested  stock-based  compensation  awards   was
approximately $2.8 million and is expected to be recognized  over
a weighted average period of 1.7 years.

     We  do  not  a have a formal policy for issuing shares  upon
exercise of stock options or vesting of restricted stock, so such
shares  are generally issued from treasury stock.  From  time  to
time,  we  repurchase shares of our common stock, the timing  and
amount   of   which   depends  on  market  and   other   factors.
Historically, the shares acquired under these regular  repurchase
programs have provided us with sufficient quantities of stock  to
issue  for  stock-based compensation.  Based on current  treasury

                                48
<PAGE>

stock  levels,  we do not expect to repurchase additional  shares
specifically for stock-based compensation during 2009.

Stock Options

     Stock  options  are granted at prices equal  to  the  market
value  of  the  common  stock on the date  the  option  award  is
granted.   Option awards currently outstanding become exercisable
in  installments from twenty-four to seventy-two months after the
date of grant.  The options are exercisable over a period not  to
exceed ten years and one day from the date of grant.

     The following table summarizes stock option activity for the
year ended December 31, 2008:

<TABLE>
<CAPTION>

                                                               Weighted      Aggregate
                                     Number of    Weighted      Average      Intrinsic
                                      Options      Average     Remaining       Value
                                        (in       Exercise    Contractual       (in
                                     thousands)   Price ($)   Term (Years)   thousands)
                                   ------------------------------------------------------
<S>                                   <C>          <C>            <C>          <C>
Outstanding at beginning of period     3,854       $12.23
   Options granted                         -       $    -
   Options exercised                  (1,453)      $ 9.38
   Options forfeited                    (132)      $17.56
   Options expired                        (5)      $17.87
                                   ---------
Outstanding at end of period           2,264       $13.74         4.65         $8,819
                                   =========
Exercisable at end of period           1,562       $12.05         3.49         $8,659
                                   =========

</TABLE>

     We  did  not  grant any stock options during the year  ended
December 31, 2008.  We granted 329,500 stock options in 2007  and
5,000  in  2006.   The  fair  value of  stock  option  grants  is
estimated  using  a  Black-Scholes  valuation  model   with   the
following weighted-average assumptions:

<TABLE>
<CAPTION>

                                         Years Ended December 31,
                                       ----------------------------
                                           2007            2006
                                       ------------    ------------
        <S>                              <C>             <C>
        Risk-free interest rate            4.3 %           4.7 %
        Expected dividend yield           1.16 %          0.88 %
        Expected volatility                 34 %            36 %
        Expected term (in years)           6.5             4.9
        Grant-date fair value            $6.44           $7.37

</TABLE>

     The  risk-free  interest  rate  assumptions  were  based  on
average  five-year  U.S.  Treasury  note  yields.  We  calculated
expected volatility using historical daily price changes  of  our
common stock for the period immediately preceding the grant  date
and  equivalent to the expected term of the stock  option  grant.
The  expected  term was the average number of years we  estimated
these  options  will  be outstanding.  We  considered  groups  of
employees  having similar historical exercise behavior separately
for valuation purposes.

     The  total intrinsic value of stock options exercised during
2008 was $15.8 million, $11.0 million in 2007 and $5.4 million in
2006.

Restricted Stock

     Restricted  stock  awards entitle the holder  to  shares  of
common stock when the award vests.  The value of these shares may
fluctuate  according  to  market conditions  and  other  factors.
Restricted stock awards that have not yet vested will vest  sixty
months from the grant date of the award. The restricted shares do
not confer any voting or dividend rights to recipients until such
shares  fully  vest  and  do  not  have  any  post-vesting  sales
restrictions.

                                49
<PAGE>

     The following table summarizes restricted stock activity for
year ended December 31, 2008:

<TABLE>
<CAPTION>

                                             Number of      Weighted
                                            Restricted       Average
                                            Shares (in     Grant Date
                                            thousands)    Fair Value($)
                                            ----------    -------------
        <S>                                     <C>          <C>
        Nonvested at beginning of period         -           $      -
           Shares granted                       35           $  22.88
           Shares vested                         -           $      -
           Shares forfeited                      -           $      -
                                            ----------
        Nonvested at end of period              35           $  22.88
                                            ==========

</TABLE>

     We granted 35,000 shares of restricted stock during the year
ended  December  31,  2008  and  did  not  grant  any  shares  of
restricted stock during 2007 and 2006. We estimate the fair value
of  restricted stock awards based upon the market  price  of  the
underlying  common  stock on the date of grant,  reduced  by  the
present  value of estimated future dividends because  the  awards
are  not  entitled to receive dividends prior  to  vesting.   The
present value of estimated future dividends was calculated  using
the following assumptions:


<TABLE>
<CAPTION>

                                                   Year Ended
                                                   December 31,
                                                       2008
                                                   ------------
        <S>                                           <C>
        Dividends per share (quarterly amounts)       $0.05
        Risk-free interest rate                         3.0 %

</TABLE>

Employee Stock Purchase Plan

     Employees  that  meet  certain eligibility requirements  may
participate  in  our Employee Stock Purchase Plan (the  "Purchase
Plan").   Eligible participants designate the amount  of  regular
payroll  deductions and/or a single annual payment (each  subject
to  a  yearly maximum amount) that is used to purchase shares  of
our common stock on the over-the-counter market.  These purchases
are subject to the terms of the Purchase Plan.  We contribute  an
amount equal to 15% of each participant's contributions under the
Purchase  Plan.   Our  contributions for the Purchase  Plan  were
$139,000  for  2008,  $162,000 for 2007 and  $170,000  for  2006.
Interest  accrues on Purchase Plan contributions  at  a  rate  of
5.25%   until  the  purchase  is  made.   We  pay  the   broker's
commissions  and administrative charges related to  purchases  of
common stock under the Purchase Plan.

401(k) Retirement Savings Plan

     We  have  an  Employees'  401(k)  Retirement   Savings  Plan
("401(k)  Plan").  Employees are eligible to participate  in  the
401(k)  Plan if they have been continuously employed with  us  or
one  of  our  subsidiaries for six months or more.   We  match  a
portion  of  each employee's 401(k) Plan elective deferrals.   We
may,  at  our  discretion, make an additional annual contribution
for employees so that our total annual contribution for employees
could  equal up to 2.5% of net income (exclusive of extraordinary
items).  Salaries, wages and benefits expense in the accompanying
Consolidated  Statements  of  Income  includes  our  401(k)  Plan
contributions and administrative expenses, which were a total  of
of  $1,663,000  for 2008, $1,364,000 for 2007 and $2,270,000  for
2006.

Nonqualified Deferred Compensation Plan

     The  Executive  Nonqualified Excess Plan ("Excess Plan")  is
our  nonqualified deferred compensation plan for the  benefit  of
eligible key managerial employees whose 401(k) Plan contributions
are   limited   because  of  IRS  regulations  affecting   highly
compensated  employees.   Under the terms  of  the  Excess  Plan,
participants  may elect to defer compensation on a pre-tax  basis
within annual dollar limits we establish.  At December 31,  2008,
there  were 64 participants in the Excess Plan.  Through December
31,  2008,  the  current annual limit was determined  so  that  a

                                50
<PAGE>

participant's combined deferrals in both the Excess Plan and  the
401(k)  Plan  approximate  the  maximum  annual  deferral  amount
available to non-highly compensated employees in the 401(k) Plan.
Beginning  January 1, 2009, certain participants will be  allowed
to defer combined amounts that exceed the maximum 401(k) deferral
limits  for  non-highly  compensated  employees.   Although   our
current  intention  is not to do so, we may  also  make  matching
credits  and/or profit sharing credits to participants'  accounts
as  we  so determine each year.  Each participant is fully vested
in all deferred compensation and earnings; however, these amounts
are  subject to general creditor claims until distributed to  the
participant.  Under current federal tax law, we are not allowed a
current  income  tax deduction for the compensation  deferred  by
participants,  but  we  are  allowed  a  tax  deduction  when   a
distribution  payment is made to a participant  from  the  Excess
Plan.   The accumulated benefit obligation was $1,076,000  as  of
December  31, 2008 and $1,270,000 as of December 31, 2007.   This
accumulated  benefit obligation is included  in  other  long-term
liabilities  in  the Consolidated Balance Sheets.   We  purchased
life  insurance policies to fund the future liability.  The  life
insurance policies had an aggregate market value of $1,049,000 as
of  December  31,  2008 and $1,223,000 as of December  31,  2007.
These policy amounts are included in other non-current assets  in
the Consolidated Balance Sheets.

(6)  COMMITMENTS AND CONTINGENCIES

     We  have  committed  to property and equipment purchases  of
approximately $46.6 million.

     We  are  involved  in certain claims and pending  litigation
arising  in  the normal course of business.  Management  believes
the  ultimate  resolution of these matters  will  not  materially
affect our consolidated financial statements.

(7)  RELATED PARTY TRANSACTIONS

     The  Company leases land from a trust in which the Company's
principal  stockholder  is  the sole trustee.   The  annual  rent
payments  under  this lease are $1.00 per year.  The  Company  is
responsible  for  all  real estate taxes  and  maintenance  costs
related  to  the  property, which were $77,000 in  2008  and  are
recorded  as expenses in the Consolidated Statements  of  Income.
The  Company has made leasehold improvements to the land totaling
approximately  $6.2  million  for facilities  used  for  business
meetings and customer promotion.

     The  Company's principal stockholder was the sole trustee of
a  trust that previously owned a one-third interest in an  entity
that operates a motel located near one of our terminals, and  the
Company  had committed to rent a guaranteed number of rooms  from
that motel to lodge company drivers.  The trust assigned its one-
third interest in this entity to the Company at a nominal cost in
February  2005.   The Company paid $264,000 in 2006  for  lodging
services  for company drivers at this motel.  On April 10,  2006,
the  Company purchased the remaining two-thirds interest  in  the
entity from its two owners (who are unrelated to the Company) for
$3.0  million.  The purchase price was based on an  appraisal  of
the  property by an independent appraiser.  The Company continues
to  use  this property as a private lodging facility for  company
drivers.

     The  brother  and  sister-in-law of the Company's  principal
stockholder own an entity with a fleet of tractors that  operates
as  an  owner-operator.   The Company  paid  this  owner-operator
$7,601,000  in 2008, $7,502,000 in 2007 and $7,271,000  in  2006.
The  Company  also sells used revenue equipment to  this  entity.
These  sales  totaled  $415,000 in 2008,  $622,000  in  2007  and
$789,000  in  2006.  The Company recognized gains of $103,000  in
2008, $88,000 in 2007 and $68,000 in 2006.  From this entity, the
Company   also  had  notes  receivable  related  to  the  revenue
equipment sales totaling (i) $1,237,000 at December 31, 2008  for
37  such  notes and (ii) $1,374,000 at December 31, 2007  for  40
such  notes.   This fleet is compensated using  the  same  owner-
operator  pay  package as the Company's other  comparable  third-
party  owner-operators.  The Company believes the  terms  of  the
note  agreements  and  the  tractor  sales  prices  are  no  less
favorable  to the Company than those that could be obtained  from
unrelated third parties, on an arm's length basis.

     The brother of the Company's principal stockholder had a 50%
ownership  interest in an entity with a fleet  of  tractors  that
operated  as  an  owner-operator.  The Company paid  this  owner-
operator  $161,000 in 2006 for purchased transportation services.
This  fleet  ceased  operations during 2006.   During  2007,  the
brother  of  the  Company's principal stockholder  formed  a  new

                                51
<PAGE>

entity  (of which he is the sole owner) with a fleet of  tractors
that operates as an owner-operator.  The Company paid this owner-
operator  $1,004,000 in 2008 and $425,000 in 2007  for  purchased
transportation  services.  The Company also  sells  used  revenue
equipment  to this new entity.  These sales totaled  $111,000  in
2008  and  $219,000  in 2007.  The Company  recognized  gains  of
$19,000  in 2008 and $23,000 in 2007.  The Company has  no  notes
receivable  related  to  these revenue  equipment  sales.   These
fleets  are compensated using the same owner-operator pay package
as our other comparable third-party owner-operators.  The Company
believes  the tractor sales prices are no less favorable  to  the
Company  than  those that could be obtained from unrelated  third
parties, on an arm's length basis.

     The  Company  transacts  business   with  TDR  for   certain
purchased  transportation needs.  The Company  recorded  trucking
revenues from TDR of approximately $134,000 in 2008, $107,000  in
2007  and  $308,000  in  2006.   The Company  recorded  purchased
transportation expense to TDR of approximately $437,000 in  2008,
$1,052,000  in  2007  and  $870,000 in 2006.   In  addition,  the
Company   recorded   other  operating  revenues   from   TDR   of
approximately  $8,048,000  in  2008,  $7,768,000  in   2007   and
$4,691,000  in  2006  related  primarily  to  revenue   equipment
leasing.   These leasing revenues include $297,000  in  2008  and
$274,000  in  2007 for leasing a terminal building in  Queretaro,
Mexico.   The Company also sells used revenue equipment  to  this
entity.   These  sales totaled $1,334,000 in 2008, $1,145,000  in
2007 and $3,697,000 in 2006, and the Company recognized net gains
of  $90,000 in 2008, net losses of $28,000 in 2007, and net gains
of  $170,000 in 2006.  The Company had receivables related to the
equipment  leases  and revenue equipment sales of  $6,791,000  at
December 31, 2008 and $5,048,000 at December 31, 2007.  See  Note
3 for information regarding the note receivable from TDR.

     At  December  31,  2008,  the Company  had  a  5%  ownership
interest in Transplace ("TPC"), a logistics joint venture of five
large   transportation  companies.   The  Company   enters   into
transactions with TPC for certain purchased transportation needs.
The  Company recorded operating revenue from TPC of approximately
$1,483,000 in 2008, $826,000 in 2007 and $2,300,000 in 2006.  The
Company  did not record any purchased transportation  expense  to
TPC in 2008, 2007 or 2006.

     The Company believes these transactions are on terms no less
favorable  to the Company than those that could be obtained  from
unrelated third parties on an arm's length basis.

(8)  SEGMENT INFORMATION

     We  have  two reportable segments - Truckload Transportation
Services ("Truckload") and Value Added Services ("VAS").

     The  Truckload segment consists of six operating fleets that
are aggregated because they have similar economic characteristics
and  meet  the  other  aggregation  criteria  of  SFAS  No.  131,
Disclosures   about  Segments  of  an  Enterprise   and   Related
Information ("No. 131").  The six operating fleets that  comprise
our  Truckload  segment  are as follows: (i)  dedicated  services
("Dedicated") provides truckload services required by a  specific
customer,  generally for a distribution center  or  manufacturing
facility;   (ii)  the  regional  short-haul  ("Regional")   fleet
provides  comparable truckload van service within five geographic
regions  across  the United States; (iii) the medium-to-long-haul
van  ("Van")  fleet transports a variety of consumer,  nondurable
products  and  other  commodities in  truckload  quantities  over
irregular  routes  using  dry van trailers;  (iv)  the  expedited
("Expedited")  fleet provides time-sensitive  truckload  services
utilizing driver teams; and the (v) flatbed ("Flatbed") and  (vi)
temperature-controlled ("Temperature-Controlled") fleets  provide
truckload   services  for  products  with  specialized  trailers.
Revenues  for the Truckload segment include non-trucking revenues
of  $8.6  million  for 2008, $10.0 million  for  2007  and  $11.2
million  for  2006.   These  revenues consist  primarily  of  the
portion of shipments delivered to or from Mexico where we utilize
a third-party capacity provider.

     The  VAS  segment generates the majority of our non-trucking
revenues  through four operating units that provide  non-trucking
services  to our customers.  These four VAS operating  units  are
(i)   truck  brokerage  ("Brokerage"),  (ii)  freight  management

                                52
<PAGE>

(single-source    logistics)   ("Freight   Management"),    (iii)
intermodal   services  ("Intermodal")  and  (iv)  Werner   Global
Logistics international services ("International").

     We  generate other revenues related to third-party equipment
maintenance,  equipment  leasing and other  business  activities.
None   of  these  operations  meets  the  quantitative  threshold
reporting  requirements  of SFAS No.  131.  As  a  result,  these
operations   are  grouped  in  "Other"  in  the   tables   below.
"Corporate" includes revenues and expenses that are incidental to
our  activities and are not attributable to any of our  operating
segments.   We do not prepare separate balance sheets by  segment
and,  as  a  result,  assets are not separately  identifiable  by
segment.   We have no significant intersegment sales  or  expense
transactions  that  would  require  the  elimination  of  revenue
between our segments in the tables below.

     The  following tables summarize our segment information  (in
thousands):

<TABLE>
<CAPTION>

                                                       Revenues
                                                      ----------
                                            2008         2007         2006
                                         ----------   ----------   ----------
     <S>                                 <C>          <C>          <C>
     Truckload Transportation Services   $1,881,803   $1,795,227   $1,801,090
     Value Added Services                   265,262      258,433      265,968
     Other                                   15,306       15,303       10,536
     Corporate                                3,228        2,224        2,961
                                         ----------   ----------   ----------
     Total                               $2,165,599   $2,071,187   $2,080,555
                                         ==========   ==========   ==========

</TABLE>

<TABLE>
<CAPTION>

                                                   Operating Income
                                                   ----------------
                                            2008         2007         2006
                                         ----------   ----------   ----------
     <S>                                 <C>          <C>          <C>
     Truckload Transportation Services   $   95,014   $  121,608   $  156,509
     Value Added Services                    14,570       12,418        7,421
     Other                                    2,803        3,644        1,731
     Corporate                                  548       (1,153)      (1,160)
                                         ----------   ----------   ----------
     Total                               $  112,935   $  136,517   $  164,501
                                         ==========   ==========   ==========

</TABLE>

     Information about the geographic areas in which  we  conduct
business  is summarized below (in thousands).  Operating revenues
for foreign countries include revenues for (i) shipments with  an
origin  or  destination in that country and (ii)  other  services
provided in that country.  If both the origin and destination are
in  a foreign country, the revenues are attributed to the country
of origin.

<TABLE>
<CAPTION>

                                                       Revenues
                                                       --------
                                            2008         2007         2006
                                         ----------   ----------   ----------
     <S>                                 <C>          <C>          <C>
     United States                       $1,951,222   $1,855,686   $1,872,775
                                         ----------   ----------   ----------

     Foreign countries
       Mexico                               142,860      160,988      168,846
       Other                                 71,517       54,513       38,934
                                         ----------   ----------   ----------
          Total foreign countries           214,377      215,501      207,780
                                         ----------   ----------   ----------
     Total                               $2,165,599   $2,071,187   $2,080,555
                                         ==========   ==========   ==========

</TABLE>

<TABLE>
<CAPTION>


                                                   Long-lived Assets
                                                   -----------------
                                            2008         2007         2006
                                         ----------   ----------   ----------
     <S>                                 <C>          <C>          <C>
     United States                       $  903,506   $  935,883   $1,067,716
                                         ----------   ----------   ----------

     Foreign countries
       Mexico                                22,853       35,776       28,452
       Other                                    280          282          172
                                         ----------   ----------   ----------
          Total foreign countries            23,133       36,058       28,624
                                         ----------   ----------   ----------
     Total                               $  926,639   $  971,941   $1,096,340
                                         ==========   ==========   ==========

</TABLE>

                                53
<PAGE>

     We  generate  substantially all of our revenues  within  the
United  States or from North American shipments with  origins  or
destinations  in the United States.  No customer  generated  more
than  10%  of  our  total revenues for 2008  and  2007,  and  one
customer generated 11% of total revenues for 2006.

(9)  QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

       (In thousands, except per share amounts)

<TABLE>
<CAPTION>

                           First Quarter   Second Quarter   Third Quarter  Fourth Quarter
                           --------------------------------------------------------------
<S>                          <C>             <C>              <C>            <C>
2008:
Operating revenues           $ 512,787       $ 578,181        $ 584,057      $ 490,574
Operating income                13,418          30,868           38,022         30,627
Net income                       8,375          18,112           22,446         18,647
Basic earnings per share           .12             .26              .32            .26
Diluted earnings per share         .12             .25              .31            .26

</TABLE>

<TABLE>
<CAPTION>

                           First Quarter   Second Quarter   Third Quarter   Fourth Quarter
                           --------------------------------------------------------------
<S>                          <C>             <C>              <C>             <C>
2007:
Operating revenues           $ 503,913       $ 531,286        $ 510,260       $ 525,728
Operating income                27,266          38,386           37,064          33,801
Net income                      15,668          22,254           21,850          15,585
Basic earnings per share           .21             .30              .30             .22
Diluted earnings per share         .21             .30              .30             .22

</TABLE>

ITEM  9.  CHANGES  IN  AND  DISAGREEMENTS  WITH  ACCOUNTANTS   ON
          ACCOUNTING AND FINANCIAL DISCLOSURE

     No  disclosure under this item was required within  the  two
most  recent  fiscal  years  ended  December  31,  2008,  or  any
subsequent   period,  involving  a  change  of   accountants   or
disagreements on accounting and financial disclosure.

ITEM 9A.  CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

     As  of  the  end of  the period covered by this  report,  we
carried  out  an evaluation, under the supervision and  with  the
participation  of our management, including our  Chief  Executive
Officer and Chief Financial Officer, of the effectiveness of  the
design  and  operation of our disclosure controls and procedures,
as  defined  in  Exchange  Act Rule  15d-15(e).   Our  disclosure
controls  and  procedures  are  designed  to  provide  reasonable
assurance  of  achieving the desired control  objectives.   Based
upon  that  evaluation,  our Chief Executive  Officer  and  Chief
Financial  Officer  concluded that our  disclosure  controls  and
procedures  are  effective in enabling  us  to  record,  process,
summarize and report information required to be included  in  our
periodic filings with the SEC within the required time period.

     We  have confidence in our internal controls and procedures.
Nevertheless,  our  management,  including  the  Chief  Executive
Officer  and  Chief Financial Officer, does not expect  that  the
internal  controls  or disclosure procedures  and  controls  will
prevent  all  errors or intentional fraud.  An  internal  control
system,  no  matter how well conceived and operated, can  provide
only  reasonable, not absolute, assurance that the objectives  of
such  internal  controls  are met.  Further,  the  design  of  an
internal  control  system must reflect that resource  constraints
exist,  and  the benefits of controls must be relative  to  their
costs.   Because  of  the inherent limitations  in  all  internal
control  systems, no evaluation of controls can provide  absolute
assurance that all control issues, misstatements and instances of
fraud, if any, have been prevented or detected.

                                54
<PAGE>

Management's Report on Internal Control over Financial Reporting

     Management  is  responsible for establishing and maintaining
adequate internal control over our financial reporting.  Internal
control over financial reporting is a process designed to provide
reasonable  assurance to our management and  Board  of  Directors
regarding  the  reliability  of  financial  reporting   and   the
preparation  of  financial statements for  external  purposes  in
accordance  with  U.S. generally accepted accounting  principles.
Internal   control   over   financial  reporting   includes   (i)
maintaining  records  that in reasonable  detail  accurately  and
fairly   reflect  our  transactions;  (ii)  providing  reasonable
assurance  that  transactions  are  recorded  as  necessary   for
preparation   of   our  financial  statements;  (iii)   providing
reasonable  assurance that receipts and expenditures  of  company
assets are made in accordance with management authorization;  and
(iv)    providing   reasonable   assurance   that    unauthorized
acquisition, use or disposition of company assets that could have
a  material effect on our financial statements would be prevented
or detected on a timely basis.

     Because  of its inherent limitations, internal control  over
financial  reporting  may  not prevent or  detect  misstatements.
Also,  projections of any evaluation of effectiveness  to  future
periods  are  subject  to  the  risk  that  controls  may  become
inadequate  because (i) changes in conditions may occur  or  (ii)
the  degree  of  compliance with the policies or  procedures  may
deteriorate.

     Management  assessed  the  effectiveness   of  our  internal
control  over financial reporting as of December 31, 2008.   This
assessment  is  based  on  the criteria  for  effective  internal
control  described  in  Internal Control -  Integrated  Framework
issued  by  the  Committee  of Sponsoring  Organizations  of  the
Treadway   Commission.   Based  on  its  assessment,   management
concluded that our internal control over financial reporting  was
effective as of December 31, 2008.

     Management  has  engaged KPMG LLP ("KPMG"), the  independent
registered  public accounting firm that audited the  consolidated
financial statements included in this Form 10-K, to attest to and
report  on  the  effectiveness  of  our  internal  control   over
financial reporting.  KPMG's report is included herein.

Report of Independent Registered Public Accounting Firm

The Board of Directors and Stockholders
Werner Enterprises, Inc.:

     We  have audited Werner Enterprises, Inc.'s internal control
over  financial  reporting  as of December  31,  2008,  based  on
criteria  established  in  Internal Control-Integrated  Framework
issued  by  the  Committee  of Sponsoring  Organizations  of  the
Treadway   Commission   (COSO).    Werner   Enterprises,   Inc.'s
management  is  responsible  for maintaining  effective  internal
control  over financial reporting and for its assessment  of  the
effectiveness  of  internal  control  over  financial  reporting,
included  in  the  accompanying Management's Report  on  Internal
Control  over  Financial  Reporting.  Our  responsibility  is  to
express  an  opinion  on  the  Company's  internal  control  over
financial reporting based on our audit.

     We  conducted our audit in accordance with the standards  of
the  Public  Company Accounting Oversight Board (United  States).
Those  standards require that we plan and perform  the  audit  to
obtain  reasonable  assurance about  whether  effective  internal
control  over financial reporting was maintained in all  material
respects.   Our  audit  included obtaining  an  understanding  of
internal  control  over financial reporting, assessing  the  risk
that  a material weakness exists, and testing and evaluating  the
design  and operating effectiveness of internal control based  on
the assessed risk.  Our audit also included performing such other
procedures  as we considered necessary in the circumstances.   We
believe  that  our  audit  provides a reasonable  basis  for  our
opinion.

     A  company's internal control over financial reporting is  a
process  designed to provide reasonable assurance  regarding  the
reliability  of  financial  reporting  and  the  preparation   of
financial  statements for external purposes  in  accordance  with

                                55
<PAGE>

generally  accepted accounting principles.  A company's  internal
control  over  financial reporting includes  those  policies  and
procedures  that (1) pertain to the maintenance of records  that,
in   reasonable  detail,  accurately  and  fairly   reflect   the
transactions  and dispositions of the assets of the company;  (2)
provide  reasonable assurance that transactions are  recorded  as
necessary  to  permit  preparation  of  financial  statements  in
accordance  with  generally accepted accounting  principles,  and
that receipts and expenditures of the company are being made only
in  accordance with authorizations of management and directors of
the  company;  and  (3)  provide reasonable  assurance  regarding
prevention or timely detection of unauthorized acquisition,  use,
or disposition of the company's assets that could have a material
effect on the financial statements.

     Because  of its inherent limitations, internal control  over
financial  reporting  may  not prevent or  detect  misstatements.
Also,  projections of any evaluation of effectiveness  to  future
periods  are  subject  to  the  risk  that  controls  may  become
inadequate  because of changes in conditions, or that the  degree
of compliance with the policies or procedures may deteriorate.

     In  our opinion, Werner Enterprises, Inc. maintained, in all
material  respects,  effective internal  control  over  financial
reporting  as of December 31, 2008 based on criteria  established
in Internal Control - Integrated Framework issued by COSO.

     We  also  have audited, in accordance with the standards  of
the  Public  Company Accounting Oversight Board (United  States),
the  consolidated balance sheets of Werner Enterprises, Inc.  and
subsidiaries  as of December 31, 2008 and 2007, and  the  related
consolidated  statements  of  income,  stockholders'  equity  and
comprehensive income, and cash flows for each of the years in the
three-year  period ended December 31, 2008, and our report  dated
February  27,  2009, expressed an unqualified  opinion  on  those
consolidated financial statements.

                              KPMG LLP
Omaha, Nebraska
February 27, 2009

Changes in Internal Control over Financial Reporting

     Management, under the supervision and with the participation
of  our  Chief  Executive  Officer and Chief  Financial  Officer,
concluded  that no changes in our internal control over financial
reporting  occurred during the quarter ended  December  31,  2008
that  have  materially  affected, or  are  reasonably  likely  to
materially affect, our internal control over financial reporting.

ITEM 9B.  OTHER INFORMATION

     During  fourth quarter 2008, no information was required  to
be disclosed in a report on Form 8-K, but not reported.

                            PART III

     Certain  information  required by Part III is  omitted  from
this  Form 10-K because we will file a definitive proxy statement
pursuant to Regulation 14A ("Proxy Statement") not later than 120
days  after the end of the fiscal year covered by this Form 10-K,
and  certain information included therein is incorporated  herein
by  reference.  Only those sections of the Proxy Statement  which
specifically  address the items set forth herein are incorporated
by reference.

ITEM 10.  DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

     The information required by this Item, with the exception of
the  Code  of  Corporate Conduct discussed below, is incorporated
herein by reference to our Proxy Statement.

                                56
<PAGE>

Code of Corporate Conduct

     We  adopted our Code of Corporate Conduct, which is our code
of  ethics,  that  applies  to our principal  executive  officer,
principal     financial     officer,     principal     accounting
officer/controller   and  all  other  officers,   employees   and
directors.   The  Code of Corporate Conduct is available  on  our
website, www.werner.com under "Investor Information."  We  intend
to  post  on  our website any amendment to, or waiver  from,  any
provision  of our Code of Corporate Conduct (if any) within  four
business days of any such event.

ITEM 11.  EXECUTIVE COMPENSATION

     The information required by this Item is incorporated herein
by reference to our Proxy Statement.

ITEM 12.  SECURITY  OWNERSHIP  OF CERTAIN BENEFICIAL  OWNERS  AND
          MANAGEMENT AND RELATED STOCKHOLDER MATTERS

     The information required by this Item, with the exception of
the  equity  compensation plan information  presented  below,  is
incorporated herein by reference to our Proxy Statement.

Equity Compensation Plan Information

     The  following  table summarizes, as of December  31,  2008,
information  about  compensation plans  under  which  our  equity
securities are authorized for issuance:

<TABLE>
<CAPTION>

                                                                         Number of Securities
                                                                        Remaining Available for
                                                                         Future Issuance under
                      Number of Securities to      Weighted-Average       Equity Compensation
                      be Issued upon Exercise     Exercise Price of        Plans (Excluding
                      of Outstanding Options,    Outstanding Options,   Securities Reflected in
                        Warrants and Rights      Warrants and Rights          Column (a))
  Plan Category                  (a)                     (b)                      (c)
  -------------       -----------------------    --------------------   -----------------------
  <S>                      <C>                        <C>                      <C>
  Equity compensation
    plans approved by
    stockholders           2,298,903 (1)              $13.74 (2)               8,669,682

</TABLE>

  (1) Includes 35,000 shares issuable upon vesting of outstanding
  restricted stock awards.
  (2) The weighted-average  exercise price  does  not  take  into
  account the shares issuable upon vesting of  outstanding  stock
  awards, which have no exercise price.

     We  do  not have any equity compensation plans that were not
approved by stockholders.

ITEM 13.  CERTAIN  RELATIONSHIPS  AND RELATED  TRANSACTIONS,  AND
          DIRECTOR INDEPENDENCE

     The information required by this Item is incorporated herein
by reference to our Proxy Statement.

ITEM 14.  PRINCIPAL ACCOUNTING FEES AND SERVICES

     The information required by this Item is incorporated herein
by reference to our Proxy Statement.

                                57
<PAGE>

                             PART IV

ITEM 15.  EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a)  Financial Statements and Schedules.

     (1)  Financial Statements:  See Part II, Item 8 hereof.
                                                                        Page
                                                                        ----
          Report of Independent Registered Public Accounting Firm        35
          Consolidated Statements of Income                              36
          Consolidated Balance Sheets                                    37
          Consolidated Statements of Cash Flows                          38
          Consolidated Statements of Stockholders' Equity and
            Comprehensive Income                                         39
          Notes to Consolidated Financial Statements                     40

     (2)  Financial   Statement   Schedules:   The   consolidated
financial  statement  schedule  set  forth  under  the  following
caption  is  included  herein.  The  page  reference  is  to  the
consecutively numbered pages of this report on Form 10-K.
                                                                        Page
                                                                        ----
          Schedule II - Valuation and Qualifying Accounts                60

          Schedules  not  listed above have been omitted  because
they  are  not applicable or are not required or the  information
required  to be set forth therein is included in the Consolidated
Financial Statements or Notes thereto.

     (3)  Exhibits:  The  response to this portion of Item 15  is
submitted  as  a separate section of this Form 10-K (see  Exhibit
Index on page 61).

                                58
<PAGE>

SIGNATURES

      Pursuant to the requirements of Section 13 or 15(d) of  the
Securities  Exchange Act of 1934, the registrant has duly  caused
this  report  to  be  signed on its behalf  by  the  undersigned,
thereunto duly authorized, on the 27th day of February, 2009.
                                   WERNER ENTERPRISES, INC.

                              By:  /s/ Gregory L. Werner
                                   ------------------------------
                                   Gregory L. Werner
                                   President and Chief Executive Officer

     Pursuant  to the requirements of the Securities Exchange Act
of  1934,  this  report has been signed below  by  the  following
persons on behalf of the registrant and in the capacities and  on
the dates indicated.

<TABLE>
<CAPTION>

     Signature                          Position                         Date
     ---------                          --------                         ----
<S>                         <C>                                    <C>
/s/ Clarence L. Werner      Chairman of the Board                  February 27, 2009
-------------------------
Clarence L. Werner

/s/ Gary L. Werner          Vice Chairman and                      February 27, 2009
-------------------------   Director
Gary L. Werner

/s/ Gregory L. Werner       President, Chief Executive Officer     February 27, 2009
-------------------------   and Director
Gregory L. Werner

/s/ Gerald H. Timmerman     Director                               February 27, 2009
-------------------------
Gerald H. Timmerman

/s/ Michael L. Steinbach    Director                               February 27, 2009
-------------------------
Michael L. Steinbach

/s/ Kenneth M. Bird         Director                               February 27, 2009
-------------------------
Kenneth M. Bird

/s/ Patrick J. Jung         Director                               February 27, 2009
-------------------------
Patrick J. Jung

/s/ Duane K. Sather         Director                               February 27, 2009
-------------------------
Duane K. Sather

/s/ John J. Steele          Executive Vice President,              February 27, 2009
-------------------------   Treasurer and Chief Financial
John J. Steele              Officer (Principal Financial Officer)

/s/ James L. Johnson        Senior Vice President, Controller      February 27, 2009
-------------------------   and Corporate Secretary (Principal
James L. Johnson            Accounting Officer)

</TABLE>

                                59
<PAGE>

                           SCHEDULE II

                    WERNER ENTERPRISES, INC.


                VALUATION AND QUALIFYING ACCOUNTS
                         (In thousands)

<TABLE>
<CAPTION>

                                    Balance at    Charged to    Write-off    Balance at
                                   Beginning of   Costs and    of Doubtful     End of
                                      Period       Expenses      Accounts      Period
                                   ------------   ----------   -----------   ----------
  <S>                                 <C>           <C>           <C>          <C>
  Year ended December 31, 2008:
  Allowance for doubtful accounts     $9,765        $  864        $1,074       $9,555
                                      ======        ======        ======       ======

  Year ended December 31, 2007:
  Allowance for doubtful accounts     $9,417        $  552        $  204       $9,765
                                      ======        ======        ======       ======

  Year ended December 31, 2006:
  Allowance for doubtful accounts     $8,357        $8,767        $7,707       $9,417
                                      ======        ======        ======       ======

</TABLE>


See report of independent registered public accounting firm.

                                60
<PAGE>

                          EXHIBIT INDEX

<TABLE>
<CAPTION>

  Exhibit
  Number             Description                         Page Number or Incorporated by Reference to
  -------            -----------                         -------------------------------------------
  <S>     <C>                                         <C>
  3(i)    Restated Articles of Incorporation          Exhibit 3(i) to the Company's Quarterly Report on
                                                      Form 10-Q for the quarter ended June 30, 2007

  3(ii)   Revised and Restated By-Laws                Exhibit 3(ii) to the Company's Quarterly Report on
                                                      Form 10-Q for the quarter ended June 30, 2007

  10.1    Werner Enterprises, Inc. Equity Plan        Exhibit 99.1 to the Company's Current Report on
                                                      Form 8-K dated May 8, 2007

  10.2    Non-Employee Director Compensation          Exhibit 10.1 to the Company's Quarterly Report on
                                                      Form 10-Q for the quarter ended September 30,
                                                      2007

  10.3    The Executive Nonqualified Excess Plan      Exhibit 10.2 to the Company's Quarterly Report on
          of Werner Enterprises, Inc., as amended     Form 10-Q for the quarter ended September 30,
                                                      2008

  10.4    Named Executive Officer Compensation        Filed herewith

  10.5    Lease Agreement, as amended February 8,     Exhibit 10.5 to the Company's Annual Report on
          2007, between the Company and Clarence      Form 10-K for the year ended December 31, 2006
          L. Werner, Trustee of the Clarence L.
          Werner Revocable Trust

  10.6    License Agreement, dated February 8,        Exhibit 10.6 to the Company's Annual Report on
          2007 between the Company and Clarence       Form 10-K for the year ended December 31, 2006
          L. Werner, Trustee of the Clarence L.
          Werner Revocable Trust

  10.7    Form of Notice of Grant of Nonqualified     Exhibit 10.1 to the Company's Current Report on
          Stock Option                                Form 8-K dated November 29, 2007

  10.8    Letter from the Company to Daniel H.        Exhibit 10.1 to the Company's Quarterly Report on
          Cushman, dated January 15, 2008             Form 10-Q for the quarter ended March 31, 2008

  10.9    Form of Restricted Stock Award              Exhibit 10.1 to the Company's Quarterly Report on
          Agreement for recipients under the Werner   Form 10-Q for the quarter ended September 30, 2008
          Enterprises, Inc. Equity Plan

  11      Statement Re: Computation of Per Share      See Note 1 (Common Stock and Earnings Per
          Earnings                                    Share) in the Notes to Consolidated Financial
                                                      Statements under Item 8

  21      Subsidiaries of the Registrant              Filed herewith

  23.1    Consent of KPMG LLP                         Filed herewith

  31.1    Rule 13a-14(a)/15d-14(a) Certification      Filed herewith

  31.2    Rule 13a-14(a)/15d-14(a) Certification      Filed herewith

  32.1    Section 1350 Certification                  Filed herewith

  32.2    Section 1350 Certification                  Filed herewith

</TABLE>

                                61
<PAGE>