‘One Yellow’ taking shape as company asks Teamsters for change of operations

Yellow Corp., which controls 10 percent of the $46 billion less-than-truckload (LTL) market, has begun a proposed change of operations that CEO Darren Hawkins says will make the carrier much more efficient and easier for shippers to use.

“On the service side, it’s important for LTL carriers to expand their service products,” Hawkins told LM recently. “We’re competing very strongly in the regional markets. We are listening to our customers, and they have spoken.”

The result is “One Yellow,” a super regional carrier combining a national footprint with on an emphasis on next- and second-day regional service, Hawkins emphasized.

“Yellow will emerge with one super regional web site, one invoice and one network,” Hawkins emphasized. “No more dual linehaul networks. All that efficiency frees up capacity. And that’s what customers want—access to LTL capacity.”

As part of the changes, this week Yellow officials notified the Teamsters union of a proposed utility change of operations that will combine Reddaway and YRC in the West, eliminating nine terminals, consolidating others, and creating about 260 “Utility Driver” positions.

Under the proposal, the Reddaway dispatch system will be implemented in the Western operating terminals of YRC Freight, its long-haul carrier. The exceptions will be YRC Freight terminals in Bloomington, Calif.; YRC Freight Denver; YRC Freight Phoenix, YRC Freight Portland, Ore.; YRC Freight in Albuquerque and YRC Freight in Salt Lake City. These locations will continue to follow the current dispatch methods “until integration of the Super Regional network is able to be implemented,” according to the change of operations request.

It’s all part of a 57-page change of operations request as well as an 84-page utility employee change of operations request made to the Teamsters union. Copies of the request were obtained by LM.

Additionally, Yellow’s “super regional” network plan calls for Eastern regional LTL carrier New Penn to be consolidated in the third quarter of this year. Midwest regional LTL carrier Holland is on schedule to be consolidated before the end of this year.

Mark Gladfelter, Yellow’s director of trucker relations, notified Teamsters union president Sean O’Brian and Don Emery, president of Teamsters negotiating arm TMI, of the proposed changes in a May 2 letter. A multi-regional change of operations hearing is set for around June 13.

Implementation will begin no sooner than July 17, according to the letter. The hearing is where the union can raise issues of seniority, work rules and review the details in the numbers of jobs.

Because of the scale of this change, it will be disruptive to many employees, with changes of domicile, change in work status and in seniority. Yellow officials believe this will speed up delivery times, reduce empty miles and provide more turn-around and meet-and-turn runs, as well as consolidation of terminals.

The change of operations will consolidate 20 terminals into existing terminal operations and establishes 11 so-called “velocity distribution centers.”

The change also will establish one system-wide dispatching system and one utility operation across all operating companies as part of what company officials are calling the “One Yellow” system.

It will eliminate nine terminals, reducing road turns, meet and turns, layovers as well as reducing the number of sleeper team drivers.

“The purpose of this change request is to create a Super Regional network built for speed, by increasing density and load factor in (Pickup and Delivery) and Line-haul movements, improve service, reduce empty mileage, eliminate certain fixed costs (building and lease, management staffing, taxes, communications expenses, etc.) and improve efficiencies,” Yellow said in its letter to the union.

Yellow officials are scheduled to meet with Teamsters National Freight Director John Murphy, Assistant Freight Director Danny Avelyn, area freight coordinators and local unions involved in this change of operations request. Yellow said it “fully intends” to comply with terms of the National Master Freight Agreement and supplemental agreements covering its approximately 28,000 Teamsters members.

In a related development, Yellow has scheduled a conference call with analysts following release of its first quarter earnings results following the close of the stock market on May 10.