newsworthy
$150 million in cash. In addition, the company says it
has begun selling what it termed “excess” assets, entering into
sale/leaseback transactions for its real estate holdings and
executing what it called “various cost-reduction activities.”
Analysts at J.P. Morgan Chase say the cost savings under
the proposed Teamsters agreement should give YRC a
“meaningful boost.” Others are not so sanguine, saying the
agreement will buy the company some time but will do little to alter its long-term fortunes.
One veteran trucking executive, speaking on condition of
anonymity, says there is a 75-percent chance YRC will not
survive unless the economy and freight traffic rebound in
the first quarter of 2009—a scenario few expect. The exec-
utive says YRC buried itself in debt when it acquired
Roadway Express and then the USF family of carriers. The
weakening economy and the credit crunch only worsened
an already difficult situation. Absent a swift and strong
recovery, the challenges facing the company are likely to be
insurmountable, the executive adds.
accolades
Mixed reviews
In September, YRC said it would accelerate the integration
of its Yellow Transportation and Roadway units by unifying
their sales and operational networks. YRC said that move
would save $200 million while enhancing service and
improving transit times.
But John G. Larkin, managing
director, transportation logistics
group for Stifel, Nicolaus & Co., told a
transportation gathering in
November that operational consolidations during the integration may
result in YRC’s losing 30 to 40 percent
of its combined volume.
Phil J. Gaines, Yellow Transportation’s president and the executive
heading the integration, told DC
VELOCITY at that gathering that “it is
not our intention to lose anywhere
near that level of business.”
YRC said in a statement later in the
year that the integration already is
producing better-than-expected
results in terms of service and performance. However, a third-quarter
shipper survey conducted by the New
York investment firm Wolfe Research
found a significant deterioration of
service levels. About 53 percent of
survey respondents who are YRC customers said the carrier’s service levels
were unchanged, while 23 percent
said they experienced more frequent
transit delays and 15 percent said they
have seen a rise in the frequency of
freight damage. Only 8 percent have
reported an improvement in transit
times as the integration accelerates.
For William D. Zollars, YRC’s chairman, president, and CEO, the year
begins with innumerable problems
and what appear to be very few solutions. “Zollars has backed himself into
a real nasty corner,” says the trucking
executive.
—Mark Solomon
Raise a glass. Ocean Spray has named C.H. Robinson’s Transportation
Management Center as its Third-Party Logistics Provider Supplier of the Year. The
C.H. Robinson division has seven team members on site at Ocean Spray to manage the company’s freight activities, including the daily coordination of carriers
and track-and-trace monitoring.
In addition, C.H. Robinson has received the Seven Seals award as well as three
Patriot awards from the state of Minnesota. These awards recognize employers
for their support of the National Guard and Reserve.
Wise move. Advanced Handling Systems, a Lakeland,
Fla.-based supplier of integrated material handling systems, has received Hytrol Conveyor Co.’s Pillar of Wisdom
Sales Recognition Award. The award honors Advanced
Handling for its sales achievements as a Hytrol distributor
and business partner. (Shown in photo: J.J. Phelan, COO
of Advanced Handling Systems, and Bob West, VP of
Hytrol Conveyor Co.)
PHELAN, WEST
Well rounded. Circumference America, a non–asset-based transportation
holding company, has made the Business Journal of Jacksonville’s list of top
logistics companies in Northern Florida. Circumference specializes in truckload,
less-than-truckload, expedited, and intermodal transportation services.
A good influence. The Containerization and Intermodal Institute has honored
Douglas Tilden, chairman of Ports America Group, and Ken Bloom, CEO of INTTRA, with its 2008 Connie Award. The annual award recognizes individuals for
their influence on containerization in worldwide trade and transportation. Ports
America is the largest terminal operating company in the Americas, while INTTRA
is an e-commerce portal for the ocean container industry.
Reusable recognition. The Reusable Packaging Association has given its 2008
Leadership Award to Phil David, senior perishable supply chain manager for the
Kroger Co. Kroger’s use of returnable packaging has led to product quality
improvements, waste reduction, and economic benefits for the grocery chain.
