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Federal judge says Yellow’s Teamster workers can strike

The Trucker News Staff - July 21, 2023

KANSAS CITY, Kan. — A U.S. District Court judge in Kansas has ruled against Yellow Corp.’s request for an injunction to stop a Teamsters strike. Senior Judge Julie Robinson issued the order on Friday afternoon. Robinson’s decision will allow Teamsters to strike, possibly as soon as Monday. Teamsters and Yellow officials have been at odds for weeks. Yellow Corporation executives say that a strike by Teamsters would violate the parties’ collective bargaining agreement. In an e-mailed statement released late Friday, Yellow officials said they regret Robinson’s decision. “The company, represented by Marc E. Kasowitz and Ron Rossi, partners at Kasowitz Benson Torres LLP, intends to appeal the ruling,” according to the statement. “The court, recognizing a strike would likely kill the company, resulting in the loss of 30,000 jobs, cautioned the Union — that while it won today’s battle, it could very well lose the war.” The issue came to a head this week when The Central States Pension Fund’s Board of Trustees voted on Monday, July 17, to suspend health care benefits and cease pension accruals for Yellow workers after two Yellow operating companies, Holland and Yellow Freight, failed to fulfill their financial obligations. The complaint Yellow filed against the Teamsters alleges that the Teamsters “breached their binding union contract with Yellow, causing more than $137 million in damages by unjustifiably blocking, for over eight months, Yellow’s restructuring plan to modernize its business, which is necessary to compete against non-union carriers that dominate the LTL business today.” Yellow’s complaint further states that “These modernization efforts, known as One Yellow, are essential to the company’s survival.” In a news release, the Teamsters Union said it “categorically denies the baseless allegations made by Yellow Corporation in its frivolous lawsuit….” “Yellow Corp.’s claims of breach of contract by the Teamsters are unfounded and without merit,” said Teamsters General President Sean M. O’Brien. “After decades of gross mismanagement, Yellow blew through a $700 million bailout from the federal government, and now it wants workers to foot the bill. For a company that loves to cry poor, Yellow’s executives seem to have no problem paying a team of high-priced lawyers to wage a public relations battle—all in a failed attempt to mask their incompetence.” Yellow officials say they “will continue to pursue its breach of contract case where it seeks to recover more than $1.5 billion in lost enterprise value caused by the International Brotherhood of Teamsters.” The Teamsters say they have “diligently adhered to the terms of the collective bargaining agreement (CBA) signed with Yellow Corp., fully honoring its contractual commitments and obligations,” according to the organization’s news release. “The company is misleading our members and the public. We have a contract with Yellow that expires March 31, 2024, and Teamsters are living up to it. Yellow’s management knows they’ve failed this company and their workforce because they can no longer live up to the terms they once agreed to. This lawsuit is a desperate, last-ditch attempt to save face,” said Teamsters General Secretary-Treasurer Fred Zuckerman. The Teamsters went on to say in their news release that the lawsuit by Yellow “is a blatant attempt to undermine the rights of workers and discredit the Teamsters. The Teamsters are fully prepared to defend the union’s position vigorously and utilize all available legal resources to challenge the meritless accusations put forth by Yellow Corp.” Yellow officials say that “without these crucial reforms, which are standard practice in the industry today, Yellow likely will not survive, 30,000 jobs will be lost, including 22,000 union jobs, and its shareholders, including the federal government, which owns 30.1% of Yellow stock, will be severely damaged.” In a statement, Yellow Corp.’s management team said the union’s leadership left them no choice but to sue. “For many months, we have made good faith efforts to meet with the IBT to propose a path forward that works for all parties, but they refuse even to meet, let alone engage in honest talks,” according to the statement. “We have communicated with all stakeholders in Washington, D.C., including the Biden administration, to apprise it of the imminent loss of tens of thousands of jobs, the significant anti-competitive effects on the American economy and the devastating impact to the supply chain, and to seek their assistance in persuading the IBT to negotiate a mutually acceptable agreement. We are fighting for the livelihood of our 30,000 employees who are good hard-working people. We will do all we can to save these American jobs and to protect our shareholders, including the American taxpayer.” The complaint also alleges that O’Brien “orchestrated these breaches and has prevented Yellow from meeting with IBT leadership. For several years, the IBT had endorsed the company’s modernization effort and, in fact, approved the first of the effort’s three phases before the IBT reversed itself taking, in Mr. O’Brien’s words, a ‘militant approach’ to blocking Yellow’s modernization.” Yellow executives say completion of One Yellow in 2023 “is critical to Yellow’s ability to survive, particularly given that Yellow faces, among other things, the imminent need to refinance $1.3 billion in debt — a $567.4 million term loan maturing on June 30, 2024, and a $729.4 million U.S. Treasury loan maturing on September 30, 2024. Nonetheless, as alleged, the Union has blocked Yellow’s completion of One Yellow, triggering grave uncertainty for employees, investors and customers, and has knowingly intended to cause Yellow’s economic ruin.” Yellow executives claim O’Brien “has taken up the role of public agitator for the company’s demise, recently tweeting an image of a headstone in a cemetery with ‘Yellow’ on it.” Yellow’s statement further said that O’Brien “has continued to hide behind numerous false, unconstructive, and irresponsible social media posts maligning the company, while refusing to discuss a path forward with the company itself.” Yellow officials contend they wouldn’t have had to file suit if Teamsters officials had agreed to “negotiate in good faith.” “Yellow must now take immediate steps to try to save itself,” according to the Yellow statement. “Yellow is entitled to $137.3 million (and counting) for the injury the Union has caused Yellow, and continues to cause Yellow, and in the event of its demise, at least $1.5 billion for the loss in enterprise value Yellow is sustaining as a result of the union’s breaches.”

Preliminary net trailer orders fall, according to ACT Research

The Trucker News Staff - July 21, 2023

COLUMBUS, Ind. — June’s preliminary net trailer orders decreased sequentially and were lower against longer-term comparisons, with 6,300 units (8,000 seasonally adjusted) projected to have been booked during the month, according to ACT Research. Final June results will be available later this month. This preliminary market estimate should be within +/-5% of the final order tally, a news release stated. “Preliminary net orders were 34% lower compared to May’s intake and down 75% versus the same month last year,” said Jennifer McNealy, director of commercial vehicle market research and publications at ACT Research. “Seasonal expectations suggest orders are likely to remain soft the coming few months, particularly given near record-level order backlogs. Trailer manufacturers normally spend mid-year working down the backlog ahead of the next year’s full orderboard opening.” Demand is softening, but with 2024 orderboards just beginning to open, “it is no surprise that net orders in June were the lowest they’ve been so far this year,” McNealy said. “That is simply part of the cycle,” she added. “However, we’re seeing increased and broad-based cancellations, but we’re hearing that much of this is a dealer stocking issue, rather than a general decline in fleets’ appetite for equipment. Since backlogs remain relatively healthy, most fleets needing trailers remain in queue.” When asked about build and backlog, McNealy commented, “Using preliminary June orders and the corresponding OEM build plans from the June State of the Industry: U.S. Trailers report (May data) for guidance, the trailer backlog should decrease by around 22,000 units to about 172,000 units when complete June data are released. That said, with orders being preliminary and the build number a projection, there will be some variability in reported backlogs when final data are collected.”

Depleted US diesel stocks are at lowest level since 2004

Reuters - July 21, 2023

LONDON — U.S. inventories of diesel and other distillate fuel oils have failed to replenish significantly despite a downturn in manufacturing and freight activity that has so far lasted eight months. Distillate fuel oil inventories amounted to just 118 million barrels on July 14, according to data from the U.S. Energy Information Administration Stocks were 21 million barrels (-15% or -1.15 standard deviations) below the prior 10-year seasonal average and the deficit had narrowed only modestly from 27 million barrels (-19% or -1.65 standard deviations) a year ago. Distillate stocks have increased slightly from last year when they were just 113 million barrels, but otherwise they are at the lowest level for the time of year since 2004. Chartbook: U.S. distillate fuel oil inventories There is not much scope for rebuilding depleted diesel stocks by running refineries harder, shifting them away from producing gasoline, or drawing down diesel inventories in other regions of the world: U.S. refineries were running at 94.3% of their maximum capacity in the week ended July 14, which was 2.2 percentage points above the 10-year average and the highest rate since 2015. U.S. gasoline stocks are also depleted at almost 13 million barrels (-5% or -1.31 standard deviations) below the prior 10-year seasonal average, making it difficult to boost diesel yields at their expense. In Europe, distillate inventories are 30 million barrels (-7% or -0.90 standard deviations) below the seasonal average while the deficit in Singapore is 3 million barrels (-27% or -2.52 standard deviations). U.S. distillate consumption and inventories are both closely geared to the business cycle since more than three-quarters of distillate fuel oil is consumed by trucking firms, railroads and manufacturers. In recent decades, inventories have normally been reset after a period of depletion by a mid-cycle slowdown or a cycle-ending recession, but so far the slowdown has not been deep enough to rebuild them. If the U.S. economy avoids a recession and industrial activity starts to rise, inventory depletion will resume and stocks will quickly fall to critically low levels, putting upward pressure on fuel prices and inflation. Distillate prices and refining margins have already strengthened over the last three months as inventories have remained lower than expected. Futures prices for diesel delivered in September 2023 have risen by more than $16 per barrel from their recent low near the end of April. Prices for diesel have been rising faster than crude with the gross refining margin (the “crack spread”) widening by $10 per barrel over the same period. The actual and prospective tightness of diesel supplies has started to draw interest from hedge funds and other investors. Money managers have increased their combined position in futures and options linked to middle distillates in eight of the most recent 10 weeks by a total of 76 million barrels since May 2. There have been increases in both U.S. diesel (+27 million barrels) and European gas oil (+49 million barrels) over the period. As a result, the combined position is now in the 43rd percentile for all weeks since 2013, up from just the 6th percentile at the start of May. If the U.S. economy avoids recession, this position-building will likely anticipate, accelerate and amplify the rise in distillate margins and prices. Adjusted for inflation, U.S. heating oil prices were close to the long-term average in June (48th percentile for all months since 1990). So far, positions and prices reflect a delicate balance between upside risks from depleted inventories and downside risks from a faltering global economy. But if the economy avoids a recession, diesel prices could escalate relatively rapidly.

UPS to sweeten offer as Teamsters-represented workers prepare to strike

Reuters - July 20, 2023

LOUISVILLE, Ky. — United Parcel Service on Wednesday said it would return to the bargaining table with a better offer for roughly 340,000 Teamsters-represented U.S. workers, in a bid to avert a potentially economically damaging strike on Aug. 1. “We are prepared to increase our industry-leading pay and benefits, but need to work quickly to finalize a fair deal that provides certainty for our customers, our employees and businesses across the country,” UPS said in a statement. The union said the world’s largest delivery company contacted it on Wednesday with an offer to resume talks next week, the International Brotherhood of Teamsters said in a statement on Twitter.Talks broke down on July 5, with each side blaming the other. A key sticking point in the talks is pay increases for experienced part-time workers who are making roughly the same or even less than new hires because starting wages jumped due to the labor shortage in the last few years. Any disruption to the business of UPS would be broadly felt because the company handles about 20 million packages a day – about quarter of the parcel shipments in the United States. Those include deliveries for online retailers like Amazon.com , high-value prescription drugs for doctors and hospitals, and inventory for millions of other large and small businesses. A strike could be one of the costliest in at least a century, with the impact of a 10-day strike topping $7 billion, according to one think tank. UPS pilots, who belong to a different union, would also stop flying in solidarity with the striking workers. The Teamsters have been holding “practice pickets” in major cities around the country to keep pressure on UPS. Despite all of the noise and hand-wringing, many transportation executives and analysts believe the two sides will reach a deal before the deadline. That’s because each side depends on the other. UPS called its skilled and loyal Teamster employees a competitive advantage early in the pandemic, when orders of everything from home work stations and exercise stations to sofas and large TVs overwhelmed delivery companies. On the other hand, UPS is the largest employer of Teamsters at a time when unions are fighting to grow. Meanwhile, Teamsters leader Sean O’Brien told Reuters last week he has asked President Joe Biden not to intervene in the talks, even as retail groups and other interested parties push for the administration to weigh in. “We believe an August 1 strike at UPS remains possible but not yet probable,” Susquehanna analyst Bascome Majors said in a client note. “Official news that Teamsters-UPS negotiations restart next week after a 2.5-week break clears a path to ‘get to yes’ before the deadline.”

Yellow blames Teamsters for its woes as strike looms

The Trucker News Staff - July 20, 2023

NASHVILLE — Yellow Corporation executives say that a strike by the International Brotherhood of Teamsters (IBT) would violate the parties’ collective bargaining agreement. The Central States Pension Fund’s Board of Trustees voted on Monday, July 17, to suspend health care benefits and cease pension accruals for Yellow workers after two Yellow operating companies, Holland and Yellow Freight, failed to fulfill their financial obligations. Teamsters are preparing for a possible strike as early as July 24, according to a news release. Benefit suspensions will go into effect July 23 if the company fails to make the critical payment to the Central States Health and Welfare Fund and the Central States Pension Fund for June 2023. “The Union’s breaches of the collective bargaining agreement, which are detailed in the complaint Yellow filed in its District of Kansas lawsuit against the Teamsters, are the direct cause of Yellow’s inability to make contributions to the funds,” according to a statement from Yellow. In June, Yellow officials say they wrote to the funds, requesting a short-term deferral of its obligation to pay contributions for two months, July and August, with interest. “This request is not without precedent,” according to the statement. “Regrettably, the Board of Trustees of Central States refused Yellow’s request, despite the funds’ healthy reserves.” Yellow leaders say that Teamsters General President Sean O’Brien has blamed Yellow for failing its workers, “but it is the Teamsters’ leadership who has failed the 22,000 Teamsters employed by Yellow as well as the 8,000 non-union employees who may soon become the Teamsters’ collateral damage.” “For many months, Teamsters’ leadership has steadfastly refused to negotiate the company’s long-planned and necessary modernization effort that would enable Yellow, a 100-year-old company, to streamline and strengthen its operations to compete against non-union carriers,” according to Yellow’s statement. O’Brien said that Yellow “has failed its workers once again and continues to neglect its responsibilities. This corporation’s gross mismanagement is another affront to the livelihoods and well-being of 22,000 Teamsters nationwide. Following years of worker givebacks, federal loans and other bailouts, this deadbeat company has only itself to blame for being in this embarrassing position.” Yellow leaders said that to keep up with the times and customers’ needs, the company must implement its well-publicized business modernization plan known as “One Yellow.” “Yet Teamsters’ leadership has rejected all proposed changes of operations and all proposed interim agreements, freezing the company’s business plan for nine months,” according to Yellow’s statement. “This has cost Yellow in excess of $137 million in Adjusted EBITDA and has prevented critical refinancing for the company.” Yellow leaders contend that the company “has tried to meet to negotiate a contract that would provide wage increases for its Teamster employees. In fact, just last week, Yellow made yet another proposal to the Teamsters, offering a significant wage increase that aligns with its union competitors. Commencement of meaningful negotiations with the Teamsters would set the stage for Yellow to reengage in comprehensive refinancing efforts with its lenders while clearing a path to advance One Yellow. All stakeholders- lenders, shareholders, employees and customers need to see progress.” In short, the statement reads, “Teamsters’ leadership’s obstruction of One Yellow directly caused Yellow’s liquidity crisis and Yellow’s need to implement cash-conservation measures, including its benefit funding deferral request.” Yellow executives say that for nine months, “Yellow has been ready, willing, and able to meet with the Teamsters at any time and at any place to discuss the future of its union and non-union employees and to work through the implementation of One Yellow. Even today, the Company remains ready, willing, and able to hold serious negotiations.”

Relay Payments integrates with McLeod Software

The Trucker News Staff - July 19, 2023

ATLANTA — Relay Payments, a fintech company dealing with payments for the supply chain, logistics and trucking industries, is announcing a new partnership with McLeod Software, a transportation management system (TMS) provider. The integration between the two technologies enables carriers and brokers to fully automate their lumper payments within McLeod’s TMS, making the process faster and more efficient, according to a news release. “Many of our customers were already using Relay, so this integration was a priority for us,” said Ahmed Ebrahim, vice president of Partner Alliances at McLeod Software. “Relay has been a great partner to work with every step of the way, and we’re excited to launch Relay’s lumper payment functionality into our TMS, delivering a seamless experience for our carrier and broker customers.” As a result of the integration, McLeod’s carrier and driver customers can now issue RelayCodes to pay for unloading fees and instantaneously receive receipts, all within their TMS. This streamlined process eliminates the need for manual updates and reduces the risk of errors, saving time, improving accuracy and creating a better experience for drivers, the news release stated. “The integration between Relay and McLeod has definitely improved the payment process,” said Lynn Fuhriman, vice president of operations at Doug Andrus. “We issue dozens of lumper payments daily, and it’s nice to have everything fully automated and accessible within McLeod.” Today, 300,000-plus drivers use Relay to transact. More than 90,000 companies throughout the supply chain — from large carriers to freight brokers — use Relay for their over-the-road expenses, including unloading and fuel payments. “Relay is committed to modernizing payments for the logistics industry. Integrating into existing solutions to provide a seamless experience is a key part of our vision,” said Emily Neuman, Relay’s vice president of partnerships. “We’re excited to enable more carriers and brokers to automate and standardize their payments and reporting.”

Spot rates fall for all equipment types in the latest week

The Trucker News Staff - July 19, 2023

BLOOMINGTON, Ind. — The early summer peak season in the spot market was not especially strong, but it appears to be over, according to the latest report from Truckstop and FTR Transportation Intelligence. Dry van spot rates fell about 8 cents during the week ended July 14 after declining more than 3 cents during the prior week, according to the latest data from Truckstop and FTR Transportation Intelligence. Broker-posted spot rates continued to fall during the week ended July 14 (week 28) as rates for dry van equipment fell by the most since the third week of the year. Refrigerated spot rates did not approach the drop seen in the prior week but they otherwise fell by the most since late May. After ending a five-week slide in the previous week, flatbed spot rates resumed their downward trend. Loads available Total load activity rebounded nearly 34% after the plunge during the Independence Day holiday week, but volume did not match that during the week before the holiday. Volume was almost 43% below the same week last year and nearly 24% below the five-year average. As expected, loads rose sharply in all regions. Truck postings jumped more than 31%, and the Market Demand Index – the ratio of loads to trucks – rose above the prior week but otherwise was at its lowest level since Thanksgiving week last year. Total rates The total broker-posted rate declined more than 4 cents for the seventh straight weekly decrease. The total market rate was more than 22% below the same 2022 week and nearly 7% below the five-year average. Until June, rates had held close to the five-year average, but declining flatbed rates and mostly lackluster van segment rates have resulted in declines. The total market rate in the latest week was the lowest since August 2020. Dry van Dry van spot rates fell about 8 cents after declining more than 3 cents during the prior week. Rates, which were at their lowest level since the week before May’s International Roadcheck event, were about 21% below the same 2022 week and about 11% below the five-year average. Dry van loads rose about 25% after falling 31% during the holiday week. Volume was almost 39% below the same week last year and 16% below the five-year average for the week. Reefer Refrigerated spot rates declined about 5 cents after falling nearly 17 cents during the July 4 holiday week. As was the case with dry van equipment, refrigerated rates were at their lowest level since the week before International Roadcheck. Rates were about 15% below the same 2022 week and 9% below the five-year average for the week. Refrigerated loads increased about 17% after falling more than 33% during the holiday week. Volume was nearly 35% below the same week last year and about 15% below the five-year average for the week. Flatbed Flatbed spot rates decreased 4.6 cents after rising 2.5-cents during the previous week. Rates were at their lowest level since January 2021 and were nearly 26% below the same 2022 week and more than 5% below the five-year average. Flatbed loads jumped nearly 46% after falling nearly 32% during the July 4 holiday week. Aside from the July 4 holiday week, load activity was the weakest since Thanksgiving week last year. Volume was nearly 51% below the same week last year and 36% below the five-year average for the week.

Truck freight tonnage, revenues rise in 2022, new ATA report says

The Trucker News Staff - July 19, 2023

WASHINGTON — Big rigs moved more than 11.4 billion tons of freight in 2022, generating more than $940 billion — both increases from the previous year, according to the latest edition of American Trucking Associations’ (ATA) American Trucking Trends 2023. “While 2022 was a challenging year for trucking in many respects, the industry still posted growth in revenue, tonnage, employment and several other measures,” said ATA Chief Economist Bob Costello. “In addition, by share of freight revenue and tonnage, trucking remained by far the dominant mode of transportation in the country.” Among the findings in Trends, in 2022: Trucks moved 11.46 billion tons of freight — up from 10.93 billion tons the previous year. The industry collected 80.7% of the nation’s freight bill — generating $940.8 billion. Trucking employed 8.4 million people in industry-related jobs — up 405,000 from the previous year, including 3.54 million professional truck drivers. Women made up 8.1% of the nation’s drivers — an all-time high and the seventh straight annual increase. Trends detailed the racial/ethnic background of drivers, with 18.3% of drivers identifying as Black, 4% as Asian and 23.3% as Hispanic or Latino. Trucking remains a small business industry: 95.8% of fleets operate 10 or fewer trucks and 99.7% operate 100 or fewer. Trucks moved 61.9% of the value of surface trade between the U.S. and Canada and 83.5% of cross-border trade with Mexico, for a total of $947.92 billion worth of goods. This year’s expanded edition of Trends includes several new datasets and topics, including annual data about America’s household goods movers, new chapters on the broader macroeconomy with a focus on drivers of freight volumes, and an overview of ATA’s driver compensation data. “As government and business leaders make choices that determine the trajectory of our economy, the data found in these pages can help drive those decisions — that’s why Trends has a place on the most influential desks, providing actional insights to elected officials, regulators, industry insiders, and economic analysts,” said ATA President and CEO Chris Spear. “This is your guide to an industry that embodies the true meaning of essential.”

Class 8 tractor production saw June gains

The Trucker News Staff - July 19, 2023

COLUMBUS, Ind. — June’s Class 8 tractor backlog decline met expectations as seasonally weak orders ran headlong into strong production, according to ACT Research’s latest State of the Industry: NA Classes 5-8 report. The Class 8 backlog fell 14,000 units month-over-month to 175,200. With 164,000 units scheduled for 2H’23 production, only 11,000 units of June’s backlog is sitting in 2024, according to ACT. According to Kenny Vieth, ACT’s president and senior analyst, “Coupling the annual seasonally weak period of orders (typically April-August) and healthy supply chains enabling elevated production, the Class 8 backlog will be on a downward trajectory until 2024 orderboards open.” Traditionally, he added, “those out-year orderboards open in October, but in recent cycles, we have seen them open as early as August.” Regarding June’s Class 8 build rate, Vieth noted, “it was a healthy 1,406 units per day, and represented the ninth month in the past 10 in which the build rate exceeded 1,300 units per day. The industry produced 29,905 units across June’s 22 build days.” Class 8 orders rose 9% year-over-year in June with the final tally at 16,773. “Adjust for typical dearth in summer order activity, seasonal adjustment lifts orders to 20,300 units.” Vieth concluded. “Meanwhile, end market demand in recent months has favored trucks over tractors. Tractor orders declined 1% y/y in June, while truck orders rose 28% year-over-year. Truck orders are experiencing strong tailwinds from federal legislation and manufacturing reshoring which are boosting construction spending and spurring demand for vocational equipment.”

PS Logistics expands with acquisition of Action Dedicated

The Trucker News Staff - July 18, 2023

BIRMINGHAM, Ala. — P&S Transportation LLC, a PS Logistics subsidiary, has announced the purchase of all substantial transportation assets of Action Dedicated LLC and Action Dedicated II LLC, a subsidiary of Action Resources LLC that specializes in dedicated transportation in the southeastern United States. Financial terms of the transaction were not disclosed, a news release noted. Headquartered in Birmingham, Alabama, Action Dedicated maintains a fleet of 120 drivers and 364 trailers, primarily hauling automotive components for blue-chip customers. “We are proud to welcome Action Dedicated to the PS Logistics family” said Scott Smith, chief executive officer and co-founder of PS Logistics. “We look forward to working with their strong leadership team and upstanding drivers, while also continuing to deliver best-in-class service to its customers.” Organizationally, Action Dedicated will be managed by David McKinley as a separate division of P&S, according to the news release. Action Dedicated will continue to operate under the same name. “We believe P&S will be a great successor and steward for the Action Dedicated business,” said Staci Pierce, CEO of Action Enterprise Holdings, said. “We are pleased for Action Dedicated to be acquired by another driver-first company while we continue our heightened focus on the growth of our specialty chemical and waste, environmental, and logistics platforms.” Since 2016, PS Logistics has successfully acquired 27 trucking and brokerage operations.

Teamsters issue strike notice after Yellow Corp. fails to make $50M in benefits contributions

The Trucker News Staff - July 18, 2023

WASHINGTON — The Central States Pension Fund’s Board of Trustees voted on Monday, July 17, to suspend health care benefits and cease pension accruals for Yellow workers after two Yellow operating companies, Holland and Yellow Freight, failed to fulfill their financial obligations. Teamsters are preparing for a possible strike as early as July 24, according to a news release. Benefit suspensions will go into effect July 23 if the company fails to make the critical payment to the Central States Health and Welfare Fund and the Central States Pension Fund for June 2023. “Yellow has failed its workers once again and continues to neglect its responsibilities,” said Teamsters General President Sean M. O’Brien. “This corporation’s gross mismanagement is another affront to the livelihoods and well-being of 22,000 Teamsters nationwide. Following years of worker givebacks, federal loans and other bailouts, this deadbeat company has only itself to blame for being in this embarrassing position.” According to a news release, Yellow owed Central States $50 million on July 15, a payment it missed and must still make by July 23 to avoid a work stoppage and interruption in benefits for Teamster families. “Yellow has a responsibility and obligation to workers. Our members should not suffer because of management’s incompetence and financial irresponsibility. This is a new low, even for a company as dysfunctional as Yellow,” said Teamsters General Secretary-Treasurer Fred Zuckerman. “The Teamsters are working with our local unions, and we will continue to regularly update members as this situation unfolds.” In its own statement, Yellow officials said that the company “advised Central States Funds that it would defer payment of health and pension contributions for June (due July 15) and July (due August 15) to preserve liquidity as it worked to obtain meetings with the IBT [International Brotherhood of Teamsters] as well as secure additional financing.” Yellow said it intends to repay the funds with interest immediately upon securing additional financing and has asked the funds to discuss acceptable terms.

ATA Truck Tonnage Index sees 2.1% increase in June

The Trucker News Staff - July 18, 2023

WASHINGTON — American Trucking Associations’ advanced seasonally adjusted (SA) For-Hire Truck Tonnage Index rose 2.1% in June after increasing 1.2% in May. In June, the index equaled 116.5 (2015=100) compared with 114.1 in May, according to a news release. “While the tonnage index increased in both May and June, it remains in recession territory,” said ATA Chief Economist Bob Costello. “The index continues to fall from a year earlier and is off 1.9% from its recent peak in September 2022. A multitude of factors have caused a recession in freight, including stagnant consumer spending on goods, lower home construction, falling factory output, and shippers consolidating freight into fewer shipments compared with the frenzy during the goods buying spree at the height of the pandemic. However, the magnitude of the year-over-year declines is improving, perhaps pointing to a bottom in the freight market.” May’s increase was revised lower from the ATA’s June 20 news release. Compared with June 2022, the SA index decreased 0.8%, which was the fourth straight year-over-year decrease. In May, the index was down 2.4% from a year earlier. The not seasonally adjusted index, which represents the change in tonnage actually hauled by the fleets before any seasonal adjustment, equaled 120.8 in June, 1.8% above the May level (118.7). In calculating the index, 100 represents 2015. ATA’s For-Hire Truck Tonnage Index is dominated by contract freight as opposed to spot market freight. Trucking serves as a barometer of the U.S. economy, representing 72.6% of tonnage carried by all modes of domestic freight transportation, including manufactured and retail goods. Trucks hauled 11.46 billion tons of freight in 2022. Motor carriers collected $940.8 billion, or 80.7% of total revenue earned by all transport modes. ATA calculates the tonnage index based on surveys from its membership and has been doing so since the 1970s. This is a preliminary figure and subject to change in the final report issued around the 5th day of each month. The report includes month-to-month and year-over-year results, relevant economic comparisons, and key financial indicators.

FedEx makes moves in executive departments

The Trucker News Staff - July 18, 2023

MEMPHIS, Tenn. — FedEx Corp. has announced the appointment of John W. Dietrich, formerly the chief executive officer of Atlas Air Worldwide, to executive vice president and chief financial officer, effective Aug. 1. The company also made shifts within the finance organization to further bolster its ongoing transformation, according to a news release. “I am thrilled to be joining the FedEx team to support and advance DRIVE and other important corporate initiatives to foster greater efficiencies, manage costs and provide innovative solutions that benefit the entire organization,” Dietrich said. “Together, we will deliver on the tremendous opportunity FedEx has to expand margins and improve returns as we build off a lower cost base, which will deliver significant long-term value for our stockholders. And we will do this while continuing to provide the outstanding level of service that is synonymous with the FedEx brand.” Additional changes in the finance organization include: Jennifer L. Johnson, corporate vice president and principal accounting officer, is assuming an expanded role with the consolidation of the company’s international accounting teams into one global organization under her responsibility. Johnson also has responsibility for all controllership functions, including the consolidations process, SEC reporting, statutory reporting and Sarbanes-Oxley compliance. Leslie M. Benners, senior vice president of finance and former CFO of FedEx Office and FedEx Services, is now leading the company’s sourcing and procurement efforts with a globally consolidated team, providing greater focus on driving efficiencies to reduce the cost base across the enterprise. Claude F. Russ, currently COO of FedEx Dataworks and former CFO of FedEx Freight, is joining the corporate Finance team as corporate vice president of Finance Transformation to provide oversight and accountability for the execution and measurement of enterprise financial objectives. “The evolution of our Finance leadership team is critical to our transformation as we continue to build a more intelligent, flexible and efficient network,” said Raj Subramaniam, president and chief executive officer for FedEx. “I am pleased to welcome John to FedEx. He is an accomplished and seasoned leader in the transportation industry whose unique combination of financial and operational expertise is a strong complement to the existing executive leadership team at this important time for the company. His appointment, along with the other strategic changes within the Finance leadership team, will further strengthen our ability to generate efficiencies, improve margins, and enhance returns.” Dietrich held numerous leadership roles at Atlas Air Worldwide since 1999, including serving as president and chief executive officer and member of the board of directors since 2020. He has more than 30 years of experience in the aviation and air cargo industries. Dietrich was appointed president of Atlas Air Worldwide in 2019 and served as COO with responsibility for all aspects of the company’s global operations from 2006 until assuming the CEO position in 2020. Prior to joining Atlas Air Worldwide, Dietrich worked for United Airlines for 13 years. He currently serves as chairman of the National Defense Transportation Association, a director on the board of AAR Corporation, a member of the Board of Governors of the International Air Transport Association and a member and former chairman of the National Air Carrier Association. In their new and expanded roles, Johnson, Benners and Russ will report to Dietrich.

Truckstop acquires FreightFriend

The Trucker News Staff - July 18, 2023

PLYMOUTH, Idaho — Load board and freight management company Truckstop has acquired FreightFriend, a cloud-based capacity and freight management firm that uses artificial intelligence to manage shipments. According to a news release, Truckstop’s acquisition of the FreightFriend platform “extends the company’s leadership in matching high-quality freight with high-quality carriers. The FreightFriend platform is industry-leading technology that enables carriers and brokers to manage their business relationships, reduce friction and improve outcomes of freight matching activities.” Truckstop CEO Kendra Tucker said of the acquisition: “At Truckstop, we continue to invest in our industry-leading freight marketplace and compliance management offerings. Our solutions reduce friction and increase trust in the market while driving greater efficiencies and higher profits for both brokers and carriers. With the acquisition of RMIS, and now the FreightFriend solution, we will further enable our customers to build and foster relationships that support the growth of their businesses.” FreightFriend founder and CEO Noam Frankel said that relationships and trust are at the heart of moving freight efficiently, safely and profitably. “We are thrilled to continue our mission of building trust and transparency in the freight market; the combination of the Truckstop and FreightFriend solutions will be a powerful tool for brokers and carriers alike to match freight, service their clients effectively and build a profitable business,” Frankel said.

DAT Truckload Volume Index: June signals that spot rates have hit bottom

The Trucker News Staff - July 18, 2023

BEAVERTON, Ore. — Truckload freight volumes and spot rates held firm in June while contract rates fell to their lowest points in almost two years, according to DAT Freight & Analytics. “The gap between spot and contract rates was the narrowest since April 2022,” said Ken Adamo, DAT’s chief of analytics. “Spot rates for van and refrigerated freight increased for the third straight month, and volumes were almost unchanged from May. These are signs that spot truckload prices have reached the bottom of the current freight cycle.” The national benchmark contract rate for dry van freight has not increased for 12 consecutive months. At $2.58 per mile, the rate was 70 cents lower than a year ago. Volumes held steady in June The DAT Truckload Volume Index (TVI), an indicator of loads moved during a given month, decreased marginally for van and refrigerated (“reefer”) freight and increased slightly for flatbed loads: Van TVI: 230, down 1% from May. Reefer TVI: 167, down 3% from May. Flatbed TVI: 267, up 2% from May. Van, reefer rates improved On the spot market, the national benchmark rates for van and reefer freight rose while the flatbed rate declined compared to May: Spot van rate: $2.08 per mile, up 3 cents, the first increase in five months. Spot reefer rate: $2.47 a mile, up 3 cents. Spot flatbed rate: $2.61 a mile, down 4 cents. Van line haul rates averaged $1.65 a mile, up 4 cents compared to May, while reefer line haul rates averaged $2.01 a mile, up 5 cents. The flatbed line haul rate dipped 2 cents to $2.10 a mile. Line haul rates subtract an amount equal to an average fuel surcharge. Lower diesel prices in June pushed fuel surcharges to 17-month lows, averaging 43 cents a mile for van freight, 46 cents for reefers, and 51 cents for flatbeds. Load-to-truck ratios reflected seasonal demand Load-to-truck ratios reflect truckload supply and demand on the DAT One marketplace: The national average van load-to-truck ratio was 2.6, meaning there were 2.6 loads for every van posted to the DAT One marketplace last month. The ratio was 2.5 in May and 3.9 in June 2022. The reefer ratio averaged 3.8, up from 3.6 in May and down from 7.0 in June 2022. The flatbed ratio fell to 9.7, down from 11.7 in May and 37.6 in June 2022. “Demand for truckload services typically slows at this time of year, but this could change quickly given the threat of strikes in the parcel and less-than-truckload sectors,” Adamo said. “Shippers are putting contingency plans in place and would look to freight brokers and carriers on the spot market to keep their line haul operations moving. Demand for trucks would jump, especially around Louisville, Memphis, Indianapolis, Dallas and other major parcel hubs.”

Penske Truck Leasing acquires Star Truck Rentals, Kris-Way Truck Leasing

The Trucker News Staff - July 17, 2023

READING, Pa. — Penske Truck Leasing has announced a major expansion of its fleet. Company officials said that the acquisitions of Star Truck Rentals Inc., a transportation services company offering full-service leasing, commercial truck rental, contract maintenance, used truck sales and additional services, and Kris-Way Truck Leasing Inc., a transportation services company offering full-service leasing, commercial truck rental, contract maintenance and dedicated contract carriage, are now complete. According to a news release, the acquisition of Star Truck Rentals increases Penske’s existing fleet by approximately 1,900 vehicles and adds 18 locations throughout Michigan and Indiana, while the acquisition of Kris-Way Truck Leasing increases Penske’s existing fleet by approximately 900 vehicles and adds seven locations throughout Maine and New Hampshire. Penske is now integrating the facilities, staff, vehicles and processes of both companies into its existing network, the news release stated. “We are excited to join Penske,” said Tom Bylenga, president of Star Truck Rentals. “Penske and Star share a similar culture and approach towards supporting customers and developing associates. Joining with Penske will offer new opportunities for growth across an expanded network.” Art Vallely, president of Penske Truck Leasing, said that Star has “has impressive scale in the region, an excellent reputation in the industry and a commitment to exceptional customer service. We look forward to integrating Star into the Penske brand and leveraging the best both companies have to offer to serve new and existing customers in the region.” On the acquisition of Kris-Way, Vallely said: “Kris-Way has earned a stellar reputation in the marketplace. Penske and Kris-Way customers will benefit from the combined services both companies have to offer across our growing network. We look forward to working closely with Kris-Way customers and associates to integrate the business into the Penske brand.” Kris-Way President Tom Keffer said that, as part of Penske, “Kris-Way is well-positioned to support our customers’ needs into the future. By expanding our network, our associates will have new opportunities for growth and development.”

ACT Research: June used truck market enjoys ‘historically expected’ sales gains

The Trucker News Staff - July 17, 2023

COLUMBUS, Ind. — The preliminary Class 8 same dealer used truck retail sales volumes improved again in June, up 4% month-over-month, according to the latest preliminary release of the State of the Industry: U.S. Classes 3-8 Used Trucks published by ACT Research. Combined, the auction, retail and wholesale channels saw preliminary same dealer sales advance 21% month-over-month, the report notes. Compared to May 2023, average retail price was flat, while miles increased 2% and age declined 3%. Compared to June of 2022, volumes and miles increased 24% and 1%, respectively, but price and age declined 27% and 9%. According to Steve Tam, vice president at ACT Research, “For the third straight month, the retail market’s performance fell between the auction and wholesale markets. Auction activity turned in its typical third month of the quarter burst, adding 48% month-over-month. Dealers continue to play it close to the vest, with their sales down 7% month-over-month in June.” Tam said that, historically, “June is the fourth best sales month of the year, about 14% above, accounting for some, but not all of the gain the industry enjoyed in June.”

We Realize Inc. opens 1st truck parking location in Las Vegas with promise of 800,000 more spaces to come around US

The Trucker News Staff - July 17, 2023

LAS VEGAS — A startup company focused on truck parking is on an ambitious journey to create nearly a million parking spots around the country over the next seven years. Nashville-based We Realize Inc. has opened its first location at the Last Vegas Motor Speedway (LVMS). Realize operates 74 truck parking spots at LVMS, located at the intersection of Speedway Boulevard and Interstate 15, offering truck drivers a safe place to park or store their cargo overnight, along with real-time inventory, rate visibility and online booking capabilities so drivers can reserve daily or monthly parking in advance, according to a news release. “With more than 3.5 million drivers competing for less than 300,000 parking spots daily, Realize is focused on providing convenient, safe and amenity-forward solutions to the truck parking crisis in an effort to improve supply chain efficiency and most importantly, driver well-being,” Cody Horchak, Realize Founder and CEO, said. “Las Vegas is an ideal market for Realize, with its high volume of trucks and fleets, and we are grateful to the team at LVMS for sharing our vision and giving Realize the opportunity to launch our nationwide network here.” Realize marked its grand opening with a site tour and press conference on July 10, which included remarks from Nevada Secretary of State Francisco Aguilar, Rep. Susie Lee, D-Nev., and Rep. Dina Titus, D-Nev. Representatives from the offices of Sen. Jacky Rosen, D-Nev., and Sen. Catherine Masto, D-Nev., also attended, as well as an individual from the office of Rep. Steven Horsford, D-Nev., who presented Realize with a Certificate of Special Congressional Recognition on behalf of Nevada’s Fourth Congressional District. Realize Truck Parking at Las Vegas Motor Speedway is open 24 hours a day, seven days a week, with full-time security, fencing and ample lighting, the news release notes. Drivers may reserve parking in advance by clicking here here, upon arrival onsite, or by calling (914) 746-7923. The cost is $30 for 24 hours, and monthly parking is also available starting at $300. All paid parkers have access to air-conditioned restrooms and showers, complimentary water and other refreshments. “We’re extremely excited to partner with Realize on this initiative,” said LVMS President Chris Powell. “Certainly we are most recognized for our world-class events we put on here at the speedway, but more and more we are becoming a hub for innovation and technology and this is a great example of that.” The opening follows Realize’s participation in The White House’s EV Acceleration Challenge, to which Realize has committed to adding 200,000 Level 2 and DC Fast chargers for trucks to its network by 2030. With only about 6,000 chargers capable of charging an electric truck currently available throughout the U.S., Realize is targeting un-and underutilized real estate assets with ample surface parking that are located near major U.S. ports and logistics routes to implement its above-ground, modular EV charging design, in addition to more than 800,000 75-by-16-foot truck parking spots. Realize is projected to open an additional seventeen locations in Nevada over the next 12 months.

Teamsters, TForce Freight reach tentative agreement on new contract

The Trucker News Staff - July 17, 2023

WASHINGTON — The Teamsters have tentatively agreed to terms for a new national contract at TForce Freight. Once ratified, the five-year agreement will protect Freight Teamsters and provide improvements to wages and benefits, according to a news release. “This contract contains zero concessions, only gains. Once again, Teamsters have proven that the only way to take on the employer and get the best contracts is by being a militant, fighting union,” said Sean M. O’Brien, Teamsters general president and chair of the Teamsters National Freight Industry Negotiating Committee (TNFINC). The tentative agreement includes the highest wage increases in the history of the national contract, protections against subcontracting, a return to work for laid-off workers, pension increases, reduced insurance premiums, language against road drivers working the dock, work preservation, and card-check neutrality. Teamster representatives will meet in Washington on July 24 to review the tentative agreement before sending it to the membership for a ratification vote. “This hard-fought agreement represents a significant achievement for our union and lays the foundation for a stronger and more prosperous future for TForce Teamsters,” said John A. Murphy, Teamsters national freight director and TNFINC co-chair. “I want to thank our lead negotiators Kris Taylor and Ed Thompson and the entire negotiating team for their hard work and commitment throughout the bargaining process, especially our rank-and-file members who served on the committee.” The Teamsters represent approximately 7,800 local cartage drivers, road drivers, and clerical workers with TForce Freight at 126 local unions nationwide. The current five-year agreement expires July 31.

XPO adds capacity in Georgia with Norcross Service Center Expansion

The Trucker News Staff - July 14, 2023

GREENWICH, Conn. — Freight transportation company XPO has announced the completed expansion of its Norcross, Georgia, service center, substantially expanding capacity in metro Atlanta. “This marks another important milestone in the implementation of the company’s previously announced plan to grow capacity in its North American network with 900 net new doors nationally by the first quarter of 2024,” an XPO news release stated. This expansion adds 46 doors in the Georgia market, enabling XPO to handle more freight and provide even better service to customers. Dave Bates, chief operating officer of XPO, said, “As part of our strategic plan, we’re adding new doors in markets that can use more capacity and sustain growth over time. The expansion of the Norcross service center in the growing metro Atlanta area will greatly benefit our customers as we’ll be able to serve their needs with additional flexibility and speed. It also allows us to strengthen our local presence with more well-paying career opportunities and expanded service to businesses across the region.” The Norcross service center currently employs more than 120 people. With the completion of the expansion, the company expects to hire additional dockworkers and driver sales representatives. In total, XPO employs nearly 700 people across seven service centers in Georgia.