MOTOR FREIGHT
transportationreport
W(h)ither ABF?
The carrier faces crucial contract talks with Teamsters,
but its operating issues go beyond labor.
PHOTO COURTES Y OF ABF FREIGH T S YS TEM INC.
FOR MORE THAN A DECADE, ABF FREIGHT SYSTEM
Inc., the less-than-truckload (LTL) unit of Arkansas Best
Corp., has convened a media reception on the first night of
the joint annual meeting of the National Industrial
Transportation League and Intermodal Association of
North America. After a convivial hour of socializing, ABF’s
then-CEO would step to the mike to field mostly hardball
queries from the assembled scribes.
The 2012 joint meeting came off as planned. But the ABF
reception didn’t happen.
ABF didn’t comment on why the event, which would have
taken place Nov. 11, wasn’t scheduled. However, it may be
more than coincidental that five weeks from that date, the
unionized company would begin negotiations with the
Teamsters union on a new contract covering about 7,500
employees. Given the talks’ critical nature, it’s doubtful ABF
executives would have been comfortable answering questions on the issue.
The talks, which were scheduled to start Dec. 18, are
aimed at replacing the current five-year pact when it expires
March 31. On Nov. 29, the Teamsters fired the first shot,
proposing a two-year agreement calling for a $1-an-hour
wage hike in each year and maintenance of the union’s current pension, health, and welfare benefits. Union leaders did
not say at the meeting why they sought a shorter contract
duration, according to those in attendance. However, the
duration of the proposed contract aligns with the expiration of the union’s current pact with YRC Worldwide Inc.,
ABF’s chief unionized rival.
For Fort Smith, Ark.-based ABF, the goal is twofold: to
reach an agreement as quickly as possible to avoid marketplace uncertainty and possible customer defections, and to
fashion a deal that mitigates what are the LTL sector’s highest labor costs (Exhibit 1). The company declined all
requests for comment for this story.
As of mid-2012, salaries, benefits, and the cost of pur-
