In spite of lawsuit, ABF says relationship with Teamsters largely beneficial

It’s old news by now — Fort Smith-based Arkansas Best Corp. filed suit against the Teamsters union in November.

What might surprise some is that Arkansas Best still regards its relationship with the Teamsters are largely beneficial. Arkansas Best is the parent company of ABF Freight System, a less-than-truckload carrier employing about 7,000 union drivers.

ABF took issue with certain concessions given by the Teamsters to YRC Worldwide, an Overland Park, Kan.-based less-than-truckload carrier employing about 25,000 union drivers. ABF filed its lawsuit asking for $750 million in damages that it suffered due to the alleged competitive advantage YRC was given in the marketplace due to the concessions. The complaint was dismissed in December by U.S. District Court Susan Webber Wright (Eastern District of Arkansas) for want of jurisdiction. Full Story.....

Teamsters National Freight Industry Negotiating Committee 2011 Restructuring Documents

The Teamsters National Freight Industry Negotiating Committee (TNFINC) has approved a restructuring agreement that paves the way to save the jobs of 25,000 YRCW Teamsters and keep the company in business, Teamsters General President Jim Hoffa announced Monday, February 28.

Below are links to several documents, including:

A news release that was sent out February 28.

A letter to YRCW members from General President Jim Hoffa and National Freight Division Director Tyson Johnson.

A one-page summary of the agreement in principle.

YRC carrier votes again after rejecting concessions

About 1,500 drivers and dockworkers at New Penn, a YRC Worldwide Inc. regional carrier, rejected the concessions accepted by most YRC Teamsters members earlier this month.

A revote began last week. This time, declining to accept the revised contract that reduces wages 5 percent more could cost many New Penn employees their jobs, the union said.

New Penn is a regional less-than-truckload company that operates mainly in the Northeast. Its employees are covered by a contract separate from the national agreement most freight industry Teamsters work under. YRC’s biggest units, YRC Inc. and USF Holland, approved the cuts to the national contract, including allowing YRC to suspend monthly pension fund payments until January 2011.

In a letter to New Penn union workers last week, Teamsters national freight director Tyson Johnson said YRC requested an emergency meeting with the union’s national bargaining team after the vote count.

“During the Aug. 11 meeting, the company indicated that it plans to call for a change of operations in the near future to merge New Penn into YRCW,” Johnson said. “Because the merger could cost hundreds of Teamsters jobs, the majority of New Penn local unions have also requested a revote by New Penn members.”

Essentially, industry observers said New Penn would be closed if it were to merge with YRC’s other carriers, a prospect that most likely will change the vote’s outcome this time.

Members of three Teamsters locals in the Chicago area, also under their own contracts with YRC, also rejected the concessionary proposal. They most likely will also hold revotes facing the same prospect of job losses.

YRC said bargaining units representing less than 10 percent of the company’s union employees have not yet ratified the contract revisions.

“The company and the Teamsters are addressing employee concerns for these smaller bargaining units to reconsider the modifications,” YRC said. “The company has not filed any change of operations affecting the network status of New Penn.”

The mailed ballots for the New Penn revote are expected to be counted on Sept. 9.

NEW PENN FREIGHT MEMBERS TO REVOTE JOB SECURITY PLAN

Teamsters say YRC Worldwide may close regional carrier unless workers approve wage, benefit cuts

Less-than-truckload carrier New Penn Motor Express may be merged into long-haul operator YRC unless union employees reverse course and accept wage and benefit cuts they rejected earlier this month, the Teamsters union said.

YRC Worldwide plans to merge New Penn into YRC unless the “job security plan” approved by YRC and Holland Teamsters is adopted at New Penn, Teamster executive Tyson Johnson said in an Aug. 17 letter to New Penn Teamsters.

Teamsters at New Penn will have the opportunity to vote again on the Job Security Plan, and ballots will be mailed on or about Wednesday, August 19, 2009 and will be due back September 9, 2009.

YRC Worldwide, which sought the labor concessions as part of a larger effort to restructure its operations and debt-ridden finances, did not respond immediately to calls for comment.

Teamsters at long-haul LTL carrier YRC and regional carrier Holland approved wage and benefits cuts Aug. 7 by a 58.5 percent margin.

Teamsters at regional carrier New Penn, however, who belong to a different bargaining unit, rejected the proposal.

At an Aug. 11 emergency meeting with the union's negotiating group, "the company indicated that it plans to call for a change of operations in the near future to merge New Penn into YRCW," Johnson wrote in the letter.

"Because the merger could cost hundreds of Teamster jobs, the majority of New Penn local unions have also requested a revote by New Penn members," wrote Johnson, who is co-chairman of the Teamsters National Freight Industry Negotiating Committee.

New Penn, which became part of what is now YRC when Yellow Corp. acquired Roadway in 2003, has long been considered the best of YRC's regional subsidiaries. It employs more than 2,000 workers and has 24 terminals, primarily in the Northeast.

Obama to Meet Leaders of Mexico, Canada

Summit Will Discuss 'Buy American' Trade Provisions

President Barack Obama will travel to Mexico on Sunday to attend his first summit with his Canadian and Mexican counterparts, in a meeting that the latter hope will shed light on how the U.S. plans to address trade disputes involving Mexican trucks and "Buy American" provisions seen as favoring U.S. companies.

Mr. Obama, Mexican President Felipe Calderón and Canadian Prime Minister Stephen Harper are slated to touch on a wide range of topics in the two-day North American Leaders' Summit, including economic, energy, climate and security issues.

Canadian and Mexican officials said their countries will focus on trade, with Messrs. Harper and Calderón closely gauging Mr. Obama's response to disagreements over "Buy America" provisions in the U.S. economic-stimulus plan, and Washington's ban on Mexican trucks operating in the U.S.

Full Story.......

YRC Worldwide expects union vote results Friday

Results of a union vote that will play a key role in YRC Worldwide Inc.’s future are expected Friday afternoon.

In a Thursday memo to freight local unions, Tyson Johnson, freight division director for the International Brotherhood of Teamsters, said an overwhelming number of ballots were cast regarding the concessions, meaning sorting would continue Friday morning, with a result announcement likely in the afternoon.

The concessions, the second proposed this year, include forfeiting 18 months of pension payments — which would not have to be repaid — and taking an extra 5 percent wage cut to save the trucking giant at least $45 million a month. YRC offered considerations such as options for an additional 20 percent stake in the company and a union-appointed board seat.

In a July 30 conference call, YRC executives expressed confidence in a positive outcome. Chairman and CEO Bill Zollars called it a “game-changing event” for YRC.

“All eyes now are on the Teamsters,” Jason Seidl, a Dahlman Rose & Co. LLC analyst, said in a Wednesday interview. “If this doesn’t happen, there is no Plan B. B probably stands for bankruptcy.”

In January, workers approved a 10 percent wage cut and were offered a 15 percent stake in YRC.

If the union concessions pass, then bondholders and lenders will have to do their part, and YRC will have to win back some of the business it lost, Seidl said Wednesday.

Last week, YRC reported a $309 million loss in the second quarter. The company has taken steps that include selling property, integrating subsidiaries, closing facilities, laying off workers and amending agreements with lenders in an attempt to ride out the recession.

Teamsters Launch Campaign To Support Health Care Reform

Web Site, Ad Campaign, e-Activism Part of Unprecedented Union Effort

Teamsters General President Jim Hoffa on Monday announced that the union will campaign vigorously for health care reform using a new Web site, an ad campaign, call-in days, e-activism and events planned throughout Congress's August recess.

The campaign will kick off with a new Web site today, teamstersforhealthcarereformnow.com, to mobilize members in the fight for health care reform. The Web site launch will be supported by a Web-based ad campaign on targeted state blogs and on-line publications.

Tens of thousands of Teamsters activists will be asked to call Congress on Tuesday to support quality, affordable health care for everyone now - part of a national call-in day sponsored by Health Care for America Now.

"Health care reform is too important for the labor movement to sit on the sidelines," Hoffa said. "The high cost of health care is burdening American workers, crippling U.S. companies, hurting the economy and adding to the deficit.

"I am personally urging Teamsters local unions to get out there and support President Obama's efforts to fix our broken health-care system. This is an unprecedented effort on our part."

The Web site features a toolkit for taking action, news, legislative updates and facts about the health care crisis facing America.

"Our e-activist effort is only the most recent in our ongoing mobilization of our members as we pursue our priorities: protecting and expanding American jobs and improving the quality of life for American working families," Hoffa said.

YRC Worldwide, Teamsters find their fates hitched

The Teamsters didn’t mince words.

The more than $800 million in concessions that members are voting on should “send a message to the industry players who are slashing prices in an attempt to force (YRC Worldwide Inc.) out of business that (YRC) will have the resources to be here for the long haul,” Tyson Johnson, freight division director for the International Brotherhood of Teamsters, said in a statement this month.

The recession has wedged YRC and its union into an unlikely high-stakes partnership. In the pot: the fate of a massive trucking company, roughly 49,000 jobs (35,000 of them union jobs) and one of the last big Teamsters toeholds in the freight industry. YRC accounts for nearly half of the Teamsters freight division’s 80,000 members.

“If YRC were to go out of business, the Teamsters would be hard-pressed to replace those jobs,” said John Wagner Jr., president of North Kansas City-based logistics company Wagner Industries Inc.

The fragile alliance must navigate a rocky road. Union workers’ votes on whether to take an extra 5 percent wage cut and let YRC halt pension payments for 18 months, among other measures, are expected to be counted by early August. And those workers already accepted other pay cuts and pension payment deferrals earlier this year. YRC, meanwhile, lost $257.4 million in the first quarter. It also has been attempting to manage costs by integrating subsidiaries, laying off thousands and closing facilities. Other efforts have involved renegotiating debts and selling property, including its Overland Park headquarters. Full Story.....

Ballots Mailed To YRCW Teamsters

Ballots were mailed July 17 to all YRCW Teamsters regarding the proposed Memorandum of Understanding (MOU). The Teamsters National Freight Industry Negotiating Committee (TNFINC) believes the MOU is the best effort to protect tens of thousands of Teamster members’ jobs, wages, and health and pension benefits into the future.

Ballots must be received by the Lanham, Maryland post office by August 6.

Audio Of YRCW Teamsters Conference Call Is Available

On July 16th, thousands of YRCW Teamsters participated in a conference call about the proposed Memorandum of Understanding (MOU) with General President Jim Hoffa, General Secretary-Treasurer C. Thomas Keegel and Freight Division Director Tyson Johnson. The conference call was meant for members to hear directly from IBT leaders about the MOU and to ask questions.

Click here to listen to the conference call.

Will $900 Million a Year Savings Be Enough For YRC Worldwide?

YRC Worldwide's 50,000 Teamsters employees are being asked to approve an additional 5 percent wage cut as well as an 18-month freeze in the company's pension contributions. This comes on top of a 10 percent wage cut already approved by the YRC workers. Combined, these two givebacks are estimated to save YRCW approximately $900 million annually as the debt-laden company fights for survival.

Another quarter, another round of wage and benefit cuts being proposed to rank-and-file Teamster members at troubled YRC Worldwide, the nation's largest trucking company by revenue.

YRC is asking its 35,000 active workers (plus an additional 15,000 or so laid-off or furloughed workers) to approve a 5 percent wage giveback (on top of an early 10 percent wage cut) that would last through the end of their current contract in 2013.

In addition, YRC wants to stop making payments to Teamsters pension plans for 18 months. That would save the company approximately $45 million a month, rising to $50 million a month in 2010.

Together, the two givebacks are estimated to save YRC Worldwide as much as $900 million a year.

You can pretty much bank on this latest giveback to be approved by Teamsters at YRC companies. Why? They don't have many options. Full Story.......

YRCW AND IBT REACH TENTATIVE AGREEMENT - FROM BILL ZOLLARS

The Teamsters will soon be voting on the tentative agreement to modify the terms of the current labor agreement. Bill Zollars has more in this new YRC Worldwide Insight video.

Teamsters consider extra 5 percent YRC Worldwide pay cut

YRC Worldwide Inc.’s union members will weigh an extra 5 percent pay cut on top of losing their pension contributions for 18 months, the union said Tuesday.

Leaders of local units for the International Brotherhood of Teamsters overwhelmingly endorsed the tentative plan at a Tuesday meeting in Chicago, the union said.

If union-represented YRC workers vote for the plan, the union this year would have gained options for as much as 35 percent of outstanding shares in the Overland Park, Kan.-based trucking company. The current plan also would require all YRC employees to take similar cuts, gain the union a YRC board appointee and bring in a corporate turnaround expert.

YRC and the Teamsters have been negotiating since June 29 about concessions that would provide YRC with the cash necessary to survive the recession. They reached a tentative agreement July 9 but didn’t release details until Tuesday.

The 5 percent wage cut, which would be effective until the union labor agreement ends in 2013, would mean a 15 percent total cut in wages this year. Early this year, Teamsters members agreed to a 10 percent cut in exchange for a 15 percent stake in YRC. The cost-of-living adjustment also is suspended through the contract, according to a document distributed at the Chicago meeting.

YRC would end its participation in union pension plans from July 1 through Dec. 31, 2010, meaning members don’t accrue pension benefits during that time. The company would have to resume participation and payments on Jan. 1, 2011. The move reportedly would save $500 million.

According to the document, YRC agreed to Teamsters demands that included gaining an appointee to the board, bringing in a turnaround consultant, offering the opportunity to get YRC stock options for an additional 20 percent of outstanding shares, bringing back bargaining-unit work that had been transferred to other countries, limiting the expansion of YRC Logistics and transferring its work back to the bargaining unit, restricting how the savings can be used, and requiring wages to revert to full rates should YRC file for bankruptcy or be sold. Job protections were added as well.

In addition, the document said, non-union workers at YRC will take equal pay cuts and, during the 18 months when YRC doesn’t participate in pension plans, won’t receive retirement benefits or 401(k) contributions.

YRC’s banks also agreed to “provide a fair share of the economic relief,” the document said, and YRC must provide the union with enough financial information that it can ensure the company’s compliance with plan provisions.

“Unfortunately, the freight recession has worsened for all trucking companies as 2009 has progressed, but it’s been more aggravated at (YRC) companies than any other trucking group operating in North America,” the Teamsters said in a document.

FREIGHT LEADERS SUPPORT ECONOMIC RELIEF PLAN TO PROTECT JOBS

Immediately following the Two-Man Freight meeting held July 14, a Freight Bulletin summarizing the meeting and the documents presented was sent to the printer and will then be mailed to all affected members. It should begin arriving in members’ homes this weekend. The Bulletin contains a question and answer section members will find helpful.

Click here to read the Bulletin.

RELATED LINKS
Memorandum of Understanding
How Did We Get Here?
Summary of Economic Relief Plan
Q and A: Pension and Health and Welfare Benefit Plans
Q and A: Stock Option Plan

The Teamsters Are Not to Blame for YRC Wordwide's Current Desperation

Implications

YRC Worldwide has too much debt, has lost nearly $2 billion in the last nine quarters, is downsizing its network and has outdated work rules. Of all those shortcomings, probably only the latter can be blamed exclusively on the Teamsters' union. Yet an article in Today'sFinancialNews.com tries to blame all of YRC's shortcomings on its union, and very little to management's buying binge earlier in this decade that saddled the company with an unrealistic debt load.

Analysis

YRC Worldwide, the nation's largest trucking company by revenue, is facing a financial showdown with its consortium of bank lenders. It has a liquidity crisis that may cause it to file for bankruptcy or liquidation.

If it is lucky, YRC's consortium of lenders will continue to throw the company more financial rope. If it is lucky, its customers will continue to enjoy the deep discounts it is offering for its services. If it is lucky, the economic downturn will finally turn around and the company may survive.

But none of these circumstances would have happened without the cooperation and, yes, enlightened labor relations approach showed by its 50,000 Teamsters members and its president, James P. Hoffa, son of the legendary Teamsters leader.

The Teamsters have shown remarkable flexibility in helping YRC stay afloat. They have approved one wage giveback of 10 percent and probably are close to approving another 5 percent shave. These wage cutbacks are saving the company approximately $250 million a year.

Furthermore, and maybe more importantly to freight Teamsters whose average age is about 60, the Teamsters have OK'd a pension contribution freeze to allow YRC to remain financially viable. In the first quarter alone, that pension payment deferral was worth about $83 million.

Now that YRC's shares have sunk to about the buck-a-share level, a reporter, Andrew Snyder of Today'sFinancialNews.com, has written that all this is because of stubbornness by the union.

Mr. Snyder writes: "In YRC's case, the Teamsters are maintaining their infamous negotiating might and bargaining themselves right out of a job."

That is exactly, precisely, and stunningly, 100 percent wrong, Mr. Snyder.

In fact, Teamster flexibility and willingness to work with management are the only reasons this company is still afloat. Time after time when YRC officials have gone to the Teamsters asking for concessions, they have obtained them.

Now, I'm not going to go as far as saying the Teamsters have been blameless in other unionized trucking companies' demise. After all, more than 500,000 Teamsters jobs in the freight sector have disappeared since the industry was deregulated in 1980.

But those closings have nothing to do with YRC's current plight. YRC is in the trouble it is in because of its overwhelmingly high debt load.

David Ross of Stifel Nicolaus has estimated YRC has $1.427 billion of total debt, including $728 million to its group of bank lenders. Those banks have chosen to keep YRC alive.

That $1.427 billion of debt is perhaps three times as much as an $8 billion-a-year company such as YRC can afford in lean times such as this. It suffers under that debt load because of a pair of ill-timed acquisitions -- Roadway Express in 2003 for $1.1 billion and USF Corp. in 2005 for $1.2 billion -- highly leveraged acquisitions that have been costly to YRC in the long run.

The Teamsters didn't have a darn thing to do with deciding to make those acquisitions, Mr. Snyder. The decision to plunge ahead with those debt-laden acquisitions lies squarely with YRC's management, specifically its Chairman and CEO Bill Zollars.

Even Zollars has admitted publicly that the Teamsters have been helpful in giving the company flexibility to survive. Mr. Snyder is correct in labeling YRC as a "high-risk, speculative play" for investors. But it is high risk because of management's decisions, not labor's.

Press Releases Are Good. Facts Are Better. YRC Soldiers On.

Implications

YRC Worldwide, the nation's largest trucking company by revenue, issued a press release saying it has reached a tentative agreement with the Teamsters union over more concessions made by its 55,000 rank-and-file Teamsters. Exact details are not known, and were not disclosed. They are likely to include an additional 5 percent wage cut in addition to the 10 percent wage giveback the union agreed to back in April.

Analysis

Fighting financial wars on several fronts, beleaguered U.S. trucking giant YRC Worldwide says it has reached a tentative agreement with the Teamsters union regarding more concessions by rank-and-file workers aimed at keeping the $7 billion LTL company afloat.

Exact details were not released. It is believed the Teamsters agreed to an additional 5 percent wage giveback to go along with the 10 percent cut agreed to in April. That earlier cut was estimated to save the company as much as $250 million annual. So an additional 5 percent shave might save the company $100 to $125 million.

"The press release says nothing new," wrote David G. Ross, a respected analyst who tracks YRC Worldwide for Stifel Nicolaus, Baltimore.

Ross has been on top of this company. He estimates that YRC National (the old Roadway and Yellow networks) has suffered year-over-year freight volume tonnage losses of up to 40 percent. Its regional carriers (the only Holland and New Penn companies) are off more than 20 percent. Full Story......

Pact shields union jobs, reduces costs

New Penn Motor Express’ parent company has reached a tentative deal with the Teamsters that will reduce the firm’s expenses and protect union jobs.

YRC Worldwide Inc. and the International Brotherhood of Teamsters agreed to modify terms of their current labor agreement, according to statements from the company and union issued yesterday.

YRC’s stock price, which opened the day at a 52-week low, shot up on the news and closed at $1.49, an increase of $0.60, or 67 percent. The stock has traded between $0.89 and $22.52 during the past year.

Details of the agreement are expected to be released next week after further discussions with the union, news releases from YRC and the IBT said. The modified contract will be voted on by YRC employees who are represented by the Teamsters.

New Penn, a trucking firm based in South Lebanon Township, employs more than 2,000 people and operates a fleet of more than 750 tractors and 1,700 trailers.

YRC Worldwide, with headquarters in Overland Park, Kan., and 49,000 employees, is the holding company for a group of brands, including New Penn, Holland, YRC and YRC Logistics.

The Teamsters say the deal calls for “equal sacrifice” from workers and the company, according to The Associated Press. In earlier negotiations, the Teamsters expressed concern with issues they felt would affect them and not YRC. One of those issues was that YRC was asking to stop its pension contributions for 14months, which would save $500 million, but the workers would not have received anything in return.

“This is a tough situation for the company and our members,” Teamsters Freight Division Director Tyson Johnson said in a statement. “We are confident this tentative agreement balances the need to provide job security while maintaining good quality jobs.”

“We appreciate the ongoing willingness of the Teamsters leadership to work with the company to identify ways to improve the financial position of YRC Worldwide during this severe economic recession,” YRC President and Chief Operations Officer Mike Smid said in a release. “Our employees are the most dedicated and professional in the industry, and their continued loyalty to serving our customers remains unrivaled.”

In January, the 35,000 union members agreed to a 10 percent pay cut in exchange for a 15 percent stake in the company.

YRC has sold a number of its properties, including its corporate headquarters, to preserve liquidity and has made deals with creditors to stay within terms of its debt obligations.

YRC Worldwide Statement on Tentative Agreement with Teamsters

YRC Worldwide Inc. announced today that it has reached a tentative agreement with the International Brotherhood of Teamsters leadership to modify the terms of the current labor agreement for its employees covered by the National Master Freight Agreement. The proposed changes are designed to reduce the company's cost structure and preserve operating capital.

"We appreciate the ongoing willingness of the Teamsters leadership to work with the company to identify ways to improve the financial position of YRC Worldwide during this severe economic recession," said Mike Smid, President of YRC Inc. and Chief Operations Officer of YRC Worldwide. "Our employees are the most dedicated and professional in the industry, and their continued loyalty to serving our customers remains unrivaled."

Details surrounding the tentative agreement are expected to be available next week following further discussions with labor leadership. The modified agreement will be voted on by YRC Worldwide employees who are represented by the IBT.

TEAMSTERS AND YRCW REACH TENTATIVE AGREEMENT

The Teamsters National Freight Industry Negotiating Subcommittee announced today that a tentative agreement has been reached with YRCW that addresses the Company’s immediate cash concerns and long-term competitiveness while protecting Teamster members’ jobs and benefits once the company returns to profitability.

Details of the Tentative Agreement will be made available to the membership after being explained to Local Union leaders early next week.

“In the midst of the worst economic recession in our lifetime our Union negotiators have crafted a Tentative Agreement with YRCW that requires shared sacrifice while preserving good jobs and benefits for 35,000 YRCW workers and their families and tens of thousands Teamster retirees,” said James P. Hoffa, Teamsters General President.

“This is a tough situation for the company and our members,” said Tyson Johnson, Teamsters Freight Division Director and co-chairman of the TNFINC. “Our members should know our Freight leaders, Pension Fund trustees, Teamster staff and independent experts have worked tirelessly to evaluate the situation and develop a solution that protects our members and allows the company to survive the worst freight recession in several generations. We are confident this Tentative Agreement balances the need to provide job security while maintaining good quality jobs.”

“This Tentative Agreement should also send a message to the industry players who are slashing prices in an attempt to force YRCW out of business that YRCW will have the resources to be here for the long haul,” Johnson said.

YRC offers update on turnaround efforts

YRC Worldwide Inc. has been consulting with turnaround firms and financial advisers to help it come up with a plan for weathering the recession.

The Overland Park-based trucking company late Wednesday offered an update about its work to position itself to ride out the economic downturn. The release followed a trading day in which YRC stock prices plunged 28 percent to a 52-week low of 89 cents, compared with a previous low of $1.20. Also Wednesday, an analyst said bankruptcy remains likely for YRC in the near to midterm.

Several months ago, YRC said, it retained financial advisers that include Tenex Capital Management, Alvarez & Marsal and Rothschild Inc. to help form a “comprehensive strategic plan to address its capital structure and liquidity needs.” As part of that, Rothschild has started preliminary talks with several parties that hold significant portions of YRC’s debt securities.

Labor agreement negotiations with the International Brotherhood of Teamsters union are continuing and “remain productive,” the release said. The talks reportedly center around YRC ending its participation in union pension plans for 14 months, which would yield about $500 million in savings.

YRC also detailed other progress it has made in recent months, including integrating its Yellow and Roadway networks into YRC to cut costs, a bank agreement amendment that let YRC use $73 million in escrow funds from asset sales to pay down its revolving credit facility and progress on agreements to defer pension fund payments using company real estate as collateral. YRC reached an agreement to defer $83 million in second-quarter pension contribution payments with the largest pension fund in June; since then, seven other funds have entered the same agreement, bringing deferral of another $11 million in payments. YRC, which contributes to 36 multiemployer pension plans, still is in talks with the remaining funds.

“We can’t control the economic environment, but we certainly can and are controlling our response to it,” YRC Chairman and CEO Bill Zollars said in the release. “Our self-help recovery plan is proactive and has the support of our stakeholders. We are taking the steps needed to manage our plan today, and position our company for success as the economy recovers.”

If YRC fails, what happens to US truck sector?

The fortunes of a particular corner of the U.S. trucking industry in the next year are as tied to whether one company, YRC Worldwide Inc, survives as they are to a recovery in the recession-bound U.S. economy.

If YRC fails it could provide competitors with just the reduction in industry capacity they need to jack up pricing for the first time since late 2006.

While that would be good news for the less-than-truckload (LTL) market -- which refers to truckers who consolidate smaller loads into a single truck -- it will hurt customers already facing the pinch in a down economy.

YRC, based in Overland Park, Kansas, nearly quadrupled its revenue from $2.6 billion in 2002 to a peak of $9.9 billion in 2006 thanks largely to two major acquisitions, and is important because it controls some 20 percent of the LTL market.

"One of two things has to happen: either we have to lose capacity or demand has to come back," said Morgan Keegan analyst Art Hatfield. "The rate at which YRC's business is deteriorating makes it more likely that it will be them to go out of business rather than someone else."

He said a YRC failure "would have a positive effect on the market, as it would help restore the balance between supply and demand. It would also help stop the bleeding on pricing."

LTL shippers account for around 13.6 percent of America's trucking sector, with the rest dominated by the highly fragmented truckload -- or long-haul -- market. Full Story.......