LTL News

Tuesday, April 1, 2008

Kansas City Business Journal

YRC Worldwide Inc. CEO Bill Zollars received less compensation for 2007, a year when the company lost $638.4 million.

Zollars' actual compensation earned for 2007 was $3.09 million, down 40.4 percent from $5.19 million in 2006, according to a Tuesday filing with the Securities and Exchange Commission.

"A substantial portion of Mr. Zollars' compensation is directly linked to our performance," the filing said. "As a result, incentive payouts and total compensation have decreased during this period of time."

The company didn't give Zollars an annual incentive bonus or retention stock award for 2007.

Zollars' compensation in 2007 included a base salary of $1.04 million, up 4 percent from $1 million in 2006; stock awards with a grant date fair value of $1.23 million; a cash bonus of $631,800; and other compensation of $191,889, the filing said.

Zollars' pension plan rose in value by $1.48 million.

Zollars' lower compensation for 2007 came in a year when the company posted a $735.8 million loss in the fourth quarter and a $638.4 million loss for the year. YRC suffered from a continued freight slowdown, the company closed 27 service centers and cut 1,100 jobs, and it took a $782 million charge in the fourth quarter because of a drop in the value of former USF Corp. companies it had bought for $1.5 billion in 2005.

However, the company also has expanded its international services in 2007, agreeing late last year to spend as much as $75 million to buy a Chinese trucking company and this year rolling out new services in China and Mexico.

Overland Park-based YRC (Nasdaq: YRCW) is a transportation service provider that employs about 60,000 people. It ranks No. 1 on the Kansas City Business Journal's list of area public companies.

Michigan Trucking Association Honors Con-way Freight for Safe Driving

Company Wins Outstanding Achievement in Highway Safety

ANN ARBOR, MI--(Marketwire - March 19, 2008) - Con-way Freight came out a winner at the recent Michigan Trucking Association (MTA) Annual Safety Awards Banquet. The less-than-truckload carrier and subsidiary of Con-way Inc. (NYSE: CNW) today announced that it has been recognized for its exemplary safety record and practices by the MTA. Con-way was honored with a fleet safety plaque for Outstanding Achievement in Highway Safety in the General Commodities division. Con-way also received this award in 2007. The annual awards were presented by Terri Lynn Land, Michigan's secretary of state, at a ceremony in Lansing in late February.

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Credit rating agency Standard & Poor’s on Thursday lowered YRC Worldwide’s corporate credit rating to “BB” from “BB+,” and said that the carrier’s slumping earnings could hurt its ability to fulfill credit obligations if the current softness in the trucking industry persists.

“The rating actions reflect heightened concerns over the company’s refinancing risk, earnings performance, and liquidity position over the next year, given the slowing U.S. economy and continuing pressures in the trucking sector,” S&P credit analyst Anita Ogbara said in a statement.

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Feb 15/Transport Topics/ -- Deutsche Post AG Chief Executive Officer Klaus Zumwinkel will step down from the position he has held for 18 years after German prosecutors announced he was under investigation for tax evasion, Bloomberg reported Friday.

Zumwinkel has told the board’s executive committee “that in the interest of the company, he plans to resign,” Bonn, Germany-based Deutsche Post said in an e-mailed statement Friday, Bloomberg reported.

Deutsche Post did not name a successor for Zumwinkel, 64, who is being probed by German authorities for evading 1 million euros, or about $1.5 million, in taxes by transferring money to foundations in Liechtenstein, Bloomberg said.

His successor will need to focus on the unprofitable DHL business in the Untied States and decide whether to sell retail banking unit Deutsche Postbank AG, Bloomberg reported.

Zumwinkel also sits on the airline Deutsche Lufthansa AG’s supervisory board and on U.S. investment bank Morgan Stanley’s board of directors, the Associated Press reported.

DHL Americas, ranked No. 3 on the Transport Topics 100 listing of U.S. and Canadian for-hire carriers, said this week it would cut 600 jobs in the United States due to a slowing economy.

WASHINGTON, Feb. 1 /PRNewswire-USNewswire/ -- An overwhelming majority of about 120 workers at the UPS Freight (formerly Overnite Transportation) terminals in Tampa and Fort Myers, Florida, and in Burlington, Vermont have signed authorization cards to become Teamsters, bringing the total number of drivers and dockworkers seeking to join the union to about 3,600 since January 16, Teamsters General President Jim Hoffa announced.

The Florida workers are seeking to join Local 79 in Tampa, while the Vermont workers will be joining Local 597 in South Barre, Vermont.

"Our UPS and freight members have done a great job developing a relationship with the UPS Freight workers, and communicating with them," said Ken Wood, President of Teamsters Local 79 and an International Union Vice President. "Our members who helped out are very excited that their hard work paid off. I look forward to welcoming the UPS Freight workers to our local very soon."

The Vermont victory marks the final UPS Freight terminal in New England where cards have been submitted for certification. On January 16, the union announced that a majority of workers at seven other locations in New England had submitted cards.

"With the UPS Freight workers in Vermont taking this step toward a more secure future, now a majority of all the UPS Freight workers in New England have taken that step," said Dave Laughton, Secretary-Treasurer of Teamsters Joint Council 10 who has helped lead the New England campaign.

"These latest worker victories once again are happening thanks to the efforts of our UPS and our freight members, who continue to do a great job talking about the benefits of being Teamsters," said Ken Hall, Director of the Teamsters Package Division and International Union Vice President.

In addition to the Florida and Vermont workers, a majority of UPS Freight workers in Arizona, Fresno, Atlanta, Newburgh, Farmingdale, Louisville, Lexington, Milwaukee, Minneapolis, Southern California, Oakland, Seattle, New England, Memphis and Detroit have submitted cards to become Teamsters.

Founded in 1903, the International Brotherhood of Teamsters represents 1.4 million hardworking men and women in the United States, Canada and Puerto Rico.

By RANDOLPH HEASTER

The Kansas City Star

YRC Worldwide plans to focus on geographic markets where regional carriers have been strong historically. YRC Worldwide Inc. will eliminate 1,100 jobs and close 27 terminals in the South and the Southwest in a restructuring of its regional trucking operations.

Overland Park-based YRC said it would close 21 terminals of USF Reddaway in four states: Louisiana, Oklahoma, New Mexico and Texas. That will affect 800 employees, said Mike Smid, president of YRC North American Transportation.

USF Holland, which operates in the Kansas City area, will lay off about 300 employees at terminals in Albany and Metter, Ga.; Jackson, Miss.; Lumberton, N.C.; Little Rock, Ark.; and Mobile, Ala.

Most of the employees affected are union-represented drivers and dockworkers. About 15 percent of the affected work force is management, clerical workers and support personnel, Smid said. YRC has told customers the closings are expected to take effect Feb. 22.

YRC said it would incur a one-time expense of $5 million for lease terminations on terminals and $5 million for severance payments. Most of the charges will be taken in the first quarter, the company said.

The downsizing is part of YRC’s previously announced plan to boost profits by $50 million for YRC Regional Transportation, which oversees all of the company’s regional carriers. The struggling regional operations were a big part of YRC’s net loss of nearly $640 million last year.

Last month Bill Zollars, YRC chairman and chief executive, said USF Holland and USF Reddaway would pull back from territories into where it had expanded and adopt a “back to basics” strategy that focuses on geographic markets where the carriers have been strong historically.

“These changes really bring Reddaway and Holland much closer to what had been their previous footprint,” Smid said Thursday. “These are substantial changes to our regional carriers that will let them focus on their core business and core capability.”

YRC acquired USF Corp. in 2005 as part of the company’s strategy to provide regional shipping services in addition to its national, long-haul networks operated by Yellow Transportation and Roadway. Since then, YRC has consolidated some of USF’s carriers, including USF Dugan and USF Bestway, into Holland and Reddaway.

Those moves have worsened the performance of Holland and Reddaway, Smid acknowledged. Before absorbing Bestway’s terminals, Reddaway’s traditional territory had been from the Pacific Northwest to Southern California, as well as Nevada and Colorado.

Smid said closing 16 Reddaway terminals in Texas, two each in Oklahoma and Louisiana and one in New Mexico eliminates the “L” shape that Reddaway’s network had become.

“An ‘L’ design is not good in the transportation business,” he said.

Smid said Reddaway and Holland customers shipping freight to the regions affected by the closings will have other YRC brands that can be used, including Yellow Transportation and Roadway.

However, one industry analyst said he wondered whether that strategy might backfire.

“Yellow and Roadway don’t have the same regional footprint, the same next-day service that the regionals can provide,” said Satish Jindel, president of SJ Consulting Group Inc., a transportation consulting firm. “Yes, YRC needed to do this because they have issues with pricing, and they need to cut down on some of their losses. But this approach could lead to reduced business from customers who want to deal with one carrier in all parts of the country.”

The Teamsters union said laid-off employees of Holland and Reddaway would have preferential hiring status at Yellow Transportation and Roadway, provided all Yellow and Roadway workers have been recalled and after all eligible employees under the national contract have been offered work.

“We realize this is a very difficult time for our members, and we are doing everything possible to lessen the blow,” Tyson Johnson, director of the Teamsters’ freight division, said in a statement.

The union is counting votes on a proposed new five-year contract with YRC. The tentative agreement provides wage and benefit increases, but also provides YRC with more flexibility on work rules.

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