YRC Freight pitches network changes to union

Less-than-truckload (LTL) transportation services provider YRC Worldwide said today that its YRC Freight subsidiary has submitted a proposal for a new set of network improvements—or change of operations—to the company’s union leadership.

By ·

Less-than-truckload (LTL) transportation services provider YRC Worldwide said today that its YRC Freight subsidiary has submitted a proposal for a new set of network improvements—or change of operations—to the company’s union leadership.

YRCW officials said these changes, once implemented, will serve as another step in YRC Freight’s efforts to continuously improve customer service, optimize linehaul density and load average, reduce empty miles and reduce shipment handling.

According to a copy of the proposed change of operations released by Teamsters for a Democratic Union (TDU), the proposals include:
-consolidating 29 end of line terminals into existing terminal locations;
-reducing end of line road domiciles;
-reducing distribution center locations by 3, utilizing existing capacity to create density for more network direct loading;
-reversing specified road primaries;
-establishing a new relay operation in Staunton, Va. to reduce system miles; and
-adding additional sleeper runs to the Jackson, Miss. road domicile

The TDU copy also cited YRCW as saying these changes will reduce terminal building costs, including management, staffing, lease costs, taxes, depreciation, communication, electric, water, and sewer costs, among others. And it also stated how this change of operations request continues the restructuring of YRC’s terminal network to further strengthen its financial position to better provide job security to its employees while also growing the business and increasing employment opportunities.

“By realigning our network, YRC Freight will reduce the number of handling and relay locations in order to build network density,” said Jeff Rogers, president of YRC Freight, in a statement.” These network improvements will be seamless to our customers and when implemented will improve our service. The ongoing effort to optimize our network is also a key part of our sustainability efforts as we reduce mileage and emissions. Better density means fewer empty miles and less emissions. This is all about improving customer service and taking another step to regain a lead position in the North American LTL market. This change also moves us closer to sustained profitability.”

YRCW officials did not reply to LM for further comment at press time.

The company statement said that a committee made up of union and company leadership will convene a formal hearing, which is expected to take place next month, to consider the network improvements which it said are expected to begin in May.

But TDU said that is not likely to be the case, stating yesterday that the proposed YRC change of operations is on hold, and no hearing on it is scheduled for March or for April.

TDU said that these proposed changes would result in the loss of 760 dock, cartage, shop, and office jobs, with a loss of 542 road jobs at the terminals being consolidated and conversely there would be 639 cartage and 343 road jobs added at other terminals for a net loss of 230 jobs.

In February, YRCW reported that in 2012 the company reported a positive annual operating income for the first time in six years.

YRCW’s consolidated operating revenue for 2012—at $4.851 billion—was down 0.4 percent compared to 2011, but its consolidated operating income increased $162.3 million to $24.1 million, including a $9.7 million gain on asset disposals, marking its first positive annual consolidated operating income in six years. And it reported that 2012 consolidated operating revenue at $4.869 billion and a consolidated operating loss of $138.2 million, including an $8.2 million gain on asset disposals. EBITDA for 2012 at $241.2 million represented an $82.0 million improvement over 2011.

Following the second and third quarters, which saw operating profits of $27.3 million and $15.5 million, respectively, which represented the first time in four years that YRC, the second-largest LTL carrier behind FedEx Freight, posted two straight quarters of operating profit, the fourth quarter made it three straight quarters of operating income growth at $30.0 million. Fourth quarter consolidated operating revenue at $1.169 billion was down 3.6 percent annually.

2012 operating revenue at YRC Freight—at $3.2 billion—was up 0.1 percent annually, with total tonnage per day and total shipments per day down 2.5 percent and 2.3 percent, respectively. Revenue per hundredweight and revenue per shipment were up 3.1 percent and 2.9 percent, respectively. Fourth quarter revenue for YRC Freight—at $777.2 million—was down 3.4 percent, and total daily tonnage was down 5.5 percent. Total shipments per day were down 5.4 percent, and revenue per hundredweight and revenue per shipment were up 3.2 percent and 3.1 percent, respectively.


About the Author

Jeff Berman, Group News Editor
Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. Contact Jeff Berman

Subscribe to Logistics Management Magazine!

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your entire logistics operation.
Start your FREE subscription today!

Article Topics

· All Topics
Latest Whitepaper
Improving Packaging: The Cost of Shipping Air is Going Up
Retailers and manufacturers that insist on using inefficient and sloppy packaging methods—oversized boxes, inefficient packaging, poorly constructed palletized contents—are paying for their mistakes in sharply higher freight rates. Pitt Ohio White Paper, Logistics White Paper, Dimensional Packaging
Download Today!
From the July 2016 Issue
While it’s currently a shippers market, the authors of this year’s report contend that we’ve entered a “period of transition” that will usher in a realignment of capacity, lower inventories, economic growth and “moderately higher” rates. It’s time to tighten the ties that bind.
2016 State of Logistics: Third-party logistics
2016 State of Logistics: Ocean freight
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
Getting the most out of your 3PL relationship
Join Evan Armstrong, president of Armstrong & Associates, as he explains how creating a balanced portfolio of "Top 50" global and domestic partners can maximize efficiency and mitigate risk.
Register Today!
EDITORS' PICKS
Regional ports concentrate on growth and connectivity
With the Panama Canal expansion complete, ocean cargo gateways in the Caribbean are investing to...
Digital Reality Check
Just how close are we to the ideal digital supply network? Not as close as we might like to think....

Top 25 ports: West Coast continues to dominate
The Panama Canal expansion is set for late June and may soon be attracting more inbound vessel calls...
Port of Oakland launches smart phone apps for harbor truckers
Innovation uses Bluetooth, GPS to measure how long drivers wait for cargo