Friday, March 24, 2006

ABF Selects 2006-2007 Road Team

ABF Freight System, Inc.(R),
has selected its 2006-2007 Road Team, consisting of the top driving
professionals from across ABF's North American network. The ABF(R) Road Team
members are:

Mike Broadhead, Salt Lake City Art Lucas, Buffalo, N.Y.
Bill Ellis, Sacramento, Calif. Usevio Martinez, Amarillo, Texas
Reginald Gamblin, Amarillo, Texas Ben Saiz, Albuquerque, N.M.
Larry Green, Toledo, Ohio Chris Smith, Salt Lake City
Kelvin Holly, Albuquerque, N.M. Tony Spero, Stratford, Conn.
Tim Lozny, South Chicago Randy Young, San Bernardino, Calif.

"Our 2006-2007 Road Team members have been chosen from what we believe is
the best group of drivers in the transportation industry," says ABF Senior
Vice President of Operations Wes Kemp. "Their dedication to safe driving,
commitment to quality and error-free service and devotion to upholding the
highest standards of professionalism make these drivers role models for the
entire industry."
During their 24-month term, ABF Road Team members serve as ambassadors for
ABF and the trucking industry at large. Each member is available to address
the vital role freight transportation plays in the global economy. When called
upon, they speak on safety, the image of the truck driver and the industry,
sharing the road with trucks, or other subjects of community or industry

Trucking firms applying brakes

Shares of trucking companies got stuck in reverse Thursday after the price of oil surged and the nation's largest trucker revised sharply downward its first-quarter profit outlook.

The Dow Jones transportation average dropped from a record high, plunging 91.68 points, or 2 percent, to 4523.26, its biggest fall since June.

Crude oil for May delivery jumped $2.14, or 3.5 percent, to $63.91 a barrel on the New York Mercantile Exchange, its largest gain since Feb. 24.

Shares of YRC Worldwide Inc., formerly known as Yellow Roadway Corp., tumbled nearly 15 percent after it cut its first-quarter profit forecast on a drop in shipments, higher costs and price competition. Other trucking stocks also declined.

YRC said it expects first-quarter profit of 65 cents to 70 cents a share, down from its January forecast of $1 to $1.05 a share. The company cited a drop in shipments by retailers Wal-Mart Stores Inc. and Home Depot Inc.

"We didn't expect the company would experience the level of volume deterioration that it did, nor did we expect it to have the difficulty in adjusting the cost structure," said BB&T Capital Markets analyst John Barnes, who cut his rating on the stock to "hold" from "buy."

YRC stock slid $6.73, to $38.56, its biggest drop since Feb. 25, 1998.

Swift Transportation Co., the nation's second-biggest trucking company by sales, fell $1.05, or 4.6 percent, to $21.92. J.B. Hunt Transport Services Inc., the third largest, declined 99 cents, or 4.3 percent, to $22.04. Ryder System Inc., the nation's largest truck-leasing company, lost $1.35, to $44.56.

Andrew West, an equity analyst at New York-based Standard & Poor's, cut his rating on YRC to "strong sell" from "hold." He said it's not yet clear whether the issues YRC blamed in cutting its forecast signal a slowing for other freight haulers or are unique to the company.

"It could very well be that there is a little bit of each," said West.

YRC bought Chicago-based regional trucker USF Corp. last year to expand overnight delivery in the U.S., and purchased rival Roadway Corp. in 2003, becoming the nation's largest trucking company.

US group implants electronic tags in workers

An Ohio company has embedded silicon chips in two of its employees - the first known case in which US workers have been “tagged” electronically as a way of identifying them., a private video surveillance company, said it was testing the technology as a way of controlling access to a room where it holds security video footage for government agencies and the police.

Embedding slivers of silicon in workers is likely to add to the controversy over RFID technology, widely seen as one of the next big growth industries.

RFID chips – inexpensive radio transmitters that give off a unique identifying signal – have been implanted in pets or attached to goods so they can be tracked in transit.

“There are very serious privacy and civil liberty issues of having people permanently numbered,” said Liz McIntyre, who campaigns against the use of identification technology.

But Sean Darks, chief executive of CityWatcher, said the glass-encased chips were like identity cards. They are planted in the upper right arm of the recipient, and “read” by a device similar to a cardreader.

“There’s nothing pulsing or sending out a signal,” said Mr Darks, who has had a chip in his own arm. “It’s not a GPS chip. My wife can’t tell where I am.”

The technology’s defenders say it is acceptable as long as it is not compulsory. But critics say any implanted device could be used to track the “wearer” without their knowledge.

VeriChip – the US company that made the devices and claims to have the only chips that have been approved by the Food and Drug Administration – said the implants were designed primarily for medical purposes.

So far around 70 people in the US have had the implants, the company said.

Wednesday, March 22, 2006

YRC Worldwide Updates Earnings Guidance

YRC Worldwide Inc. today announced that it expects first quarter 2006 earnings per share ("EPS") to be in the range of $0.65 to $0.70. The company's previous guidance was $1.00 to $1.05 per share for the quarter. Full year 2006 EPS guidance will be updated when the company announces first quarter results in late April.

"Although our business levels remain ahead of last year, overall volumes for the quarter are projected to come in below our expectations across all of our asset-based business units," stated Bill Zollars, Chairman, President and CEO of YRC Worldwide. "In addition to general competitive pressure, some of our large retail customers have made significant inventory adjustments in the quarter, which have impacted our business levels."

Cost overruns in several areas at Yellow Transportation are also negatively impacting the company's results. The change of operations at Roadway Express is going as planned and is not a contributor to the earnings update.

"Our view on the economy for 2006 has not changed, particularly based on apparent strength in the manufacturing sector. We are taking steps to adjust our cost base as necessary and address specific customer situations," stated Zollars.

UPS switching some routes from rail to road

Package delivery giant UPS will move fewer parcels via railroads as it embarks on a plan to reduce ground delivery times.

What's being taken from the trains is going to trucks, which offer UPS faster transit speeds on certain routes, company spokesman Norman Black said.

The switch should have little effect on the nation's biggest railroads, including Norfolk-based Norfolk Southern Railway Co., as they are straining to carry record levels of cargo. In some cases, crowded tracks have delayed shipments, disappointing customers.

UPS moves about 15 million packages daily and about half a million of those will see faster transit times as a result of the changes, Black said. However, he would not say how many packages will migrate from rails to roads.
Even with the switch, Atlanta-based UPS remains one of the largest users of railroads, Black said. It spent $750 million on rail services in 2005, mostly for trips of more than 750 miles.

"We still do an awful lot of business with the railroads, and we still use their networks where we can," he said.

Under the plan, announced this month, packages moving via ground service among 11 major U.S. cities - a list that includes Washington but not Norfolk - will have at least a day cut off their transit times, according to UPS. The company has spent the past three months gearing up for the new system, including hiring additional truck drivers.

The move to trucks is one of a variety of strategies being implemented to reduce package transit times, Black said. Others include increased use of technology and reconfiguring distribution hubs.

Larry Kaufman, a columnist with transportation industry publication Journal of Commerce, said he sees UPS' switch having minimal effect on the railroads.

"Obviously, any loads you lose is revenue off the top and you don't want to lose it," said Kaufman, a former railroad official, "but from what I've read I don't think it's going to be a major impact."

Norfolk Southern spokesman Robin Chapman said he wasn't able to comment Tuesday on the effects of UPS' decision. However, he called UPS a "major" customer and noted the railroad's plan to invest $1.15 billion this year to upgrade its rail network, such as buying additional locomotives, railcars and laying and replacing track.

Such improvements should allow Norfolk Southern to carry more cargo at faster speeds. Last year, Norfolk Southern spent $938 million on capital improvements.

Together, the country's largest railroads are expected to spend about $8 billion in 2006 on equipment and improved infrastructure, up 21 percent from last year, according to the Association of American Railroads.

Some customers think those improvements can't happen fast enough. William D. Zollars, chairman, president and chief executive officer of trucking company YRC Worldwide Inc., told Wall Street analysts in January that the railroads' poor operating performance had hit YRC's bottom line.

"On-time rail performance continued at well below acceptable levels, which has caused additional inefficiencies in our networks," Zollars said.

UPS re-evaluates its delivery operations every year, Black said.

"We are in a very competitive business," he said. "If we don't stay out front, we're going to lose that business."

Tuesday, March 21, 2006

Change to Win Unveils Major Initiative to Organize Millions of Workers

The seven-union Change to Win federation today unveiled its new campaign to unite millions of workers across the country in an effort to raise living standards and improve the quality of life for American workers. With 2,000 organizers meeting in Las Vegas for the federation's first organizing convention, Change to Win leaders announced that the Make Work Pay! campaign will launch on the week of April 24 with actions targeting major industries in more than 35 cities.

"The Make Work Pay! campaign is about ensuring that millions of taxpayers who are working harder and longer with less to show for it are able to be part of the American middle class," said Anna Burger, Chair of Change to Win. She added, "We are fighting so that individuals who work hard can earn paychecks that actually support families; receive affordable health care, have the chance to give their children a better life and count on a secure retirement."

"We are going to reach out to those workers who are not yet organized and to the members of the public that understand and support the notion that this country can't exist without a vibrant middle class," Burger said. "This campaign will empower the millions of workers to help them effect real change to make work pay."

The campaign's launch week will activate union members and community allies across the country to support efforts by workers to unite. The seven union affiliates that make up Change to Win are forming local cross-union campaign teams that will work together as single entities to unite workers in their cities in an effort to make work pay.

The Las Vegas organizing convention, which runs through Wednesday March 22, 2006, is focused on creating these local campaign teams and creating a new model for cross-union organizing. The goal of the teams will be to create effective and strong local organizations with the power to let every employer know that when they oppose any group of workers trying to unite for a decent life they will not be confronted by one union, but by seven unions representing six million members.

Burger noted that there is precedent for using the power of a well- organized workforce to turn low wage jobs into solid middle class jobs. "We need to remember that auto, steel, and other basic manufacturing jobs weren't always the good middle class jobs that they became after World War II," she said. "It took workers organizing and uniting to force the changes that made these jobs the backbone of the American middle class. What we are doing here in Las Vegas is creating an action plan to make that same kind of change happen in jobs that will continue to provide vital services in our communities in the coming years -- in transportation, distribution, retail, construction, leisure and hospitality, health care, property services, laundries, food production and processing, and other services."

The Make Work Pay! campaign will create a unified effort that encompasses the individual campaigns of the Change to Win affiliates. But instead of each of these campaigns existing as the effort of just one union, the campaigns

will receive the support and action of the other Change to Win unions at all levels.

"We've long had our individual campaigns to unite workers who drive school buses, who work in hospitals, who build our buildings, who work in ports or drive trucks," said Edgar Romney, Executive Vice President of UNITE HERE and Vice Chair of Change to Win. "But as we run these individual campaigns, we will tie our work together to make it all add up to something bigger."

Monday, March 20, 2006

ABF Selects 2006 Load Team

ABF Freight System,
Inc.(R), has selected its 2006 Load Team, an elite group of freight-handling
professionals from across ABF's North American network. The ABF(R) Load Team
members are:

Jack Barta, South Chicago
Tony Booher, Dayton, Ohio
John Brittian, Atlanta
Hector Chapa, Dallas
Chris Dutko, Winston-Salem, N.C.
Scott Hahn, Carlisle, Penn.
Randy Heath, Little Rock, Ark.
Carey Kearney, Albuquerque, N.M.
Ronnie Rowell, Kansas City, Mo.
Todd Smith, Salt Lake City

"Load Team members help to personify ABF's commitment to meeting the
needs of our customers through safe and efficient freight handling," says ABF
Senior Vice President of Operations Wes Kemp. "Due to the talents of
dedicated employees like these, shipping customers can trust ABF -- knowing
that more than 99 percent of all shipments are moved claim free."
Load Team members are selected on the basis of their safety records,
involvement in ABF's Quality Process, integrity and their ability to load
trailers in an optimal fashion -- a skill that facilitates the safe, timely
and efficient movement of shipments. The Load Team program was established
not only to honor outstanding performance but also to draw upon dock
employees' insights regarding dock procedures and equipment.
Established in 1923, ABF is one of North America's oldest and most
reputable motor carriers. Recognized as a benchmark for safety, security,
technology and freight-handling standards, ABF has a distinguished record of
service. In four of the past five years, ABF has earned either the Excellence
in Claims/Loss Prevention Award, the Excellence in Security Award, or both
from the American Trucking Associations Safety and Loss Prevention Management
Council. ABF is the only carrier to have earned both awards in the same year,
which it achieved in 2005 and 2001. ABF also was recognized by CIO magazine
for innovative excellence in information technology, earning the 2005 CIO
Enterprise Value Award for the transportation industry as well as a spot on
the CIO Top 100 Companies list in both 2005 and 2004

UPS Uses Political Clout to Press for Cuts in Pension Benefits

For 15 years, United Parcel Service Inc. has spent more money on U.S. elections than any other company. Now UPS, which has gotten its way on everything from federal highway programs to expanded routes to China, is seeking a new return on its investment.

The world's largest package-delivery service wants Congress to allow employers to cut pension benefits already promised to some workers in plans funded by multiple companies. Atlanta-based UPS says the plans can no longer afford to pay full benefits because so many companies that used to pay into the pool have gone out of business. As the number of contributors shrinks, remaining companies are obligated to fund the retirement plans.

``The way the system is structured now, it's the last man standing,'' says Representative Dave Camp, a Michigan Republican who serves on a House-Senate conference committee that's crafting pension legislation. ``You end up having greater responsibilities thrust upon employers who are remaining.'' UPS is ``probably going to be the last man standing.''

Multiemployer plans cover 9.8 million U.S. workers, or about 22 percent of those in defined-benefit plans. They were $177 billion in the red in 2003, the last year for which figures are available, according to the Pension Benefit Guaranty Corp., a quasi-governmental agency that insures pensions. The more common single-employer plans were underfunded by $450 billion in 2005, the Labor Department says.

House Signs On

The House of Representatives passed broad pension legislation in December that would require companies to pay more into multiemployer funds. It included a UPS-backed provision that would allow the plans' trustees -- which include company and union representatives -- to cut benefits by an unspecified amount for workers retiring early if the plans are less than 60 percent funded. The Senate has not approved such a provision.

``This is all part and parcel of companies backing off their pension requirements,'' says Senator Tom Harkin, an Iowa Democrat. ``They want to let pensions crash.''

UPS and companies such as Overland Park, Kansas-based YRC Worldwide Inc., the biggest U.S. trucking company, say they are targeting early-retirement benefits -- even those already being paid out -- to ensure that people who stop working at 65 can get full benefits.

For UPS, overhauling pensions is a top priority. The company has 120,000 truck drivers in 21 different multiemployer pension plans, which allow workers in highly mobile industries, such as trucking and construction, to bounce from job to job and still receive a pension when they retire. The largest one, the Central States plan, is less than 60 percent funded.

Failing Companies

At the same time, there are fewer companies contributing. One indication: The number of trucking companies signed on to a national contract with the Teamsters Union dropped from 900 in 1980, when the industry was first deregulated, to 15 today. Sixty cents of every dollar UPS pays to the pension funds covers the retirement costs of employees who worked for other companies.

``The structure of the plans is not consistent with how companies operate today,'' says UPS spokesman David Bolger, who has been lobbying lawmakers on the issue. ``It's not a healthy scenario down the road.''

Coal Miners

An example of how multiemployer plans can run into trouble was in the coal industry during the 1970s, as mines from Pennsylvania to West Virginia were shut down and companies shifted operations to Western states. Congress, under pressure from mining companies facing more than $6 billion in unfunded liabilities, amended the law in 1980 to force companies electing to leave the system to pay an exit fee. The move helped save the pensions, even though plans that were once funded by more than 1,500 mining companies are now backed by fewer than 300.

Contributors to UPS's multiemployer plans are dwindling because of bankruptcies, so those exit fees aren't being paid.

The package-delivery company's political action committee has been the most generous corporate giver to federal candidates for every election since 1992, donating a total of $14 million through Dec. 31, 2005, Federal Election Commission records show.

For that, it has gotten a willing ear from Congress. In 1999, when the company sought Transportation Department approval to begin deliveries to Beijing and Shanghai, 368 of the 535 members of the House and Senate wrote in support. The department approved the request in 2001.

Lobbying Power

UPS, whose workforce of 407,000 makes it the U.S.'s fourth- largest corporate employer, spent $1.3 million during the first half of 2005 successfully lobbying for the Central American Free Trade Agreement and legislation that provided more highway funds.

House Majority Leader John Boehner, an Ohio Republican and the sponsor of the pension provision in the House, has been the fifth-biggest recipient of UPS campaign donations among U.S. lawmakers since 1990, getting $76,700, according to the Center for Responsive Politics, a Washington-based research group that tracks campaign donations.

``Every member of Congress knows UPS is in their district,'' Bolger says. ``We consider it our obligation to participate in the political process. We go to the fundraisers.''

UPS is part of a coalition supporting the House pension provision composed of trade groups, unions and companies such as Cleveland-based Eaton Corp., the world's second-biggest maker of hydraulic equipment, and Carteret, New Jersey-based Pathmark Stores Inc., owner of more than 140 supermarkets.

Lining up against them are Senators Kent Conrad, a North Dakota Democrat, and Harkin, as well as the Teamsters union, which manages the Central States plan. Charles Grassley, an Iowa Republican who is chairman of the Finance Committee, refused to include the provision in the Senate legislation.

Not Fair

Critics of the provision say it's not fair for workers to lose pensions that they've earned. They say there are other ways to address the shortfall in pension funds, such as seeking tax relief or cutting future benefits.

The two major political parties have been split by the debate, as have labor unions. The United Food and Commercial Workers Union and Unite Here back the pension cuts, opposing the Teamsters.

Representative Rob Andrews, a New Jersey Democrat, supports the provision. ``The solution we have created is delicately balanced, and I want to make sure we hold the coalition together so that multiemployer plans can survive,'' Andrews says.

Some Senate Democrats disagree. ``I don't think it's fair to be cutting people's benefits,'' Conrad says.

`Share the Pain'

American Trucking Associations, of Alexandria, Virginia, says the proposal before Congress would require companies to pay more into the fund and guarantee full pensions to workers who don't retire early.

``It's a share-the-pain concept,'' says Tim Lynch, chief lobbyist for the trucking group, whose members include Chattanooga, Tennessee-based U.S. Xpress Enterprises Inc.

That pain would be shared even by those who retired in the last year, including Tommy Burke, who drove a UPS truck for 38 years. ``I'd have to get another job if they cut my pension like they want to,'' says Burke, 61, who lives with his 84-year-old infirm mother in Fayetteville, North Carolina, on $2,798 a month. ``This provision would really hurt a lot of working people.''

Burke is ``disappointed in UPS,'' he says. ``I gave them nearly 40 years; $2,798 a month is not too much to ask.''

Sunday, March 19, 2006

Drivers needed

Trucking companies may soon struggle to find drivers as baby boomers age and retire, said Robin Milton, terminal manager of ABF Freight System in Muncie.

By the year 2020, there will be a need for 200,000 drivers, Milton said.

Younger drivers don't want to spend long hours behind the wheel and travel across the country, Milton said. The younger generation is being pushed in another direction.

Even though some trucking companies might have problems finding drivers in the next few years, Milton said he doesn't think ABF has anything to worry about.

"ABF is a unionized based company, which makes its wage scale and benefits plan in excess of other transportation companies," he said.

"ABF has it's own driving school in Arkansas and we send good candidates to that. It cost the company around $3,000 to properly qualify a driver and we will invest that in them to make sure we have good quality people," Milton said.