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TForce | Why isn't UPS Freight making more money? Loss leader pricing.

joes bar and grill said:
That might explain the low sale price
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I think it is precious everyone thinks a union company is something you would want to pay a premium for. For comparison purposes, ARCB has a market capitalization of 1.44 billion, ODFR 24.52 billion. That is 17 times. When the cord is cut, UPS freights worth plummets. UPS was a good corporate neighbor. They would have made more shutting the company down and selling off the assets.
 
Bubba Gump said:
I think it is precious everyone thinks a union company is something you would want to pay a premium for. For comparison purposes, ARCB has a market capitalization of 1.44 billion, ODFR 24.52 billion. That is 17 times. When the cord is cut, UPS freights worth plummets. UPS was a good corporate neighbor. They would have made more shutting the company down and selling off the assets.
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www.freightwaves.com

TFI may lease UPS Freight terminals to other truckers, CEO says

CEO Alain Bedard said renting out terminal space is a way to buoy TFI’s real estate portfolio.
www.freightwaves.com www.freightwaves.com
Maybe that's TFI plan is the real estate...
 
Bubba Gump said:
I think it is precious everyone thinks a union company is something you would want to pay a premium for. For comparison purposes, ARCB has a market capitalization of 1.44 billion, ODFR 24.52 billion. That is 17 times. When the cord is cut, UPS freights worth plummets. UPS was a good corporate neighbor. They would have made more shutting the company down and selling off the assets.
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Since you don't work at UPS freight your perspective is limited.
The UPS corporation ran ups freight poorly. In fact they never had a clue how to run an ltl shipping company.
UPS doesn't give a ::shit:: about being a good neighbor to anyone, they only care about profits.
Unable to run freight in any way to make a profit, they loss leadered the ltl shipping and sold it in a fire sale, just to get something back. If it was more profitable to close and sell it off, UPS would have done it in a minute.
 
No port said:
Since you don't work at UPS freight your perspective is limited.
The UPS corporation ran ups freight poorly. In fact they never had a clue how to run an ltl shipping company.
UPS doesn't give a **** about being a good neighbor to anyone, they only care about profits.
Unable to run freight in any way to make a profit, they loss leadered the ltl shipping and sold it in a fire sale, just to get something back. If it was more profitable to close and sell it off, UPS would have done it in a minute.
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You just don't get it. This is The United States of America. That is capitalism. Capitalism is what made America the greatest nation in history. You work, you get paid. That is all your employer owes you. It is not the job of UPS to be anyone's "neighbor" or friend.
 
No port said:
UPS doesn't give a **** about being a good neighbor to anyone, they only care about profits.
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I assure you UPS went above and beyond what would be called customary, in a sale of this nature. UPS's assets are worth more than the market value of it's stock. I think in the future you might find being harassed with the, 5 seeing habits and the eight keys to lifting and lowering was a small price to pay for being an UPS employee.
 
Razorblade said:
You just don't get it. This is The United States of America. That is capitalism. Capitalism is what made America the greatest nation in history. You work, you get paid. That is all your employer owes you. It is not the job of UPS to be anyone's "neighbor" or friend.
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This makes no sense. I don't ever know why you quoted my post. I never called UPS a good neighbor, in fact I said they only care about profits.
 
Bubba Gump said:
I assure you UPS went above and beyond what would be called customary, in a sale of this nature. UPS's assets are worth more than the market value of it's stock. I think in the future you might find being harassed with the, 5 seeing habits and the eight keys to lifting and lowering was a small price to pay for being an UPS employee.
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You can assure nothing of the sort.
How would you know anything about working for UPS?
I won't miss working for UPS at all.
 
steve5 said:
Yes UPS sold Freight, but i think UPS will still be lingering around.

Im sure the same customers will be shipping LTL, which might mean that the operations will still be the same unfortunately. I would hope TFI would bring back our next day freight. the first thing UPS cut in 2006 here.
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That’s because in the package business, next day service carries a premium rate. Why do it for the regular price even if you can?
 
No port said:
corporatefinanceinstitute.com

Loss Leader Pricing

A loss leader pricing strategy, a term common in marketing, refers to an aggressive pricing strategy in which a store prices its goods below cost to
corporatefinanceinstitute.com corporatefinanceinstitute.com

The nerve of UPS brass to complain about ups freight not making any money. They are the ones in charge of this practice. I know of shippers I suspect will either be paying more to ship with TFI or we will no longer be shipping. One of these shippers was getting up to a 93% discount and not having to pay accessorial fees. Why?
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My theory is UPS only purchased Overnite so they could make a deal with the devil.
Then they did.
Once that was completed they looked for a way to punt.
Then they did..
 
UPS only cares about 2 things, money and their image, the precious "shield". Who remembers the "tightest ship in the shipping industry" campaign of a few years ago? They FAILED and they weren't used to that. They were well aware they would take an a$$-kickin' in the trades that the biggest and the best in the shipping industry couldn't run a trucking company. The industry didn't conform to their style of managing and they refused to alter their "small-pack" mentality to a highly competitive LTL field of established and well managed competition. When the little brown truck shows up, it is tended to immediately, when the big brown truck shows up, you are just next in line and they couldn't comprehend that.
I am sure they were looking for a way out, to "save face" if you will and found a way to dump UPGF in a manner that they could put a favorable spin on. The half billion dollars they lost was well worth it in their eyes to rid themselves of this mismanaged mess. They want to focus on small-pak before Amazon eats their lunch in the not to distant future.
All the parts and pieces are here to be a powerhouse carrier in the LTL field all someone needs to do is put them together.
IMHO TFI needs to tear this Company down to the foundation and rebuild from the ground up a Company not only interested in "numbers", but one with on time damage free customer service and respect for all. Something seriously missing in the last 15 years....
 
Crumudgeon said:
UPS only cares about 2 things, money and their image, the precious "shield". Who remembers the "tightest ship in the shipping industry" campaign of a few years ago? They FAILED and they weren't used to that. They were well aware they would take an a$$-kickin' in the trades that the biggest and the best in the shipping industry couldn't run a trucking company. The industry didn't conform to their style of managing and they refused to alter their "small-pack" mentality to a highly competitive LTL field of established and well managed competition. When the little brown truck shows up, it is tended to immediately, when the big brown truck shows up, you are just next in line and they couldn't comprehend that.
I am sure they were looking for a way out, to "save face" if you will and found a way to dump UPGF in a manner that they could put a favorable spin on. The half billion dollars they lost was well worth it in their eyes to rid themselves of this mismanaged mess. They want to focus on small-pak before Amazon eats their lunch in the not to distant future.
All the parts and pieces are here to be a powerhouse carrier in the LTL field all someone needs to do is put them together.
IMHO TFI needs to tear this Company down to the foundation and rebuild from the ground up a Company not only interested in "numbers", but one with on time damage free customer service and respect for all. Something seriously missing in the last 15 years....
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Someone has and is putting the pieces together. 20 years ago this month FedEx, a small package carrier, bought American Freightways. Now FedEx is the largest ltl carrier in the country and is still growing market share and profits. Powerhouse ltl carriers are not compatible with the International Brotherhood of Teamsters. Freight is not a stable business. Freight levels vary wildly from day to day, week to week and month to month. Union rules and contracts do not allow the flexibility necessary to compete in a deregulated, free market economy.
 
Razorblade said:
Someone has and is putting the pieces together. 20 years ago this month FedEx, a small package carrier, bought American Freightways. Now FedEx is the largest ltl carrier in the country and is still growing market share and profits. Powerhouse ltl carriers are not compatible with the International Brotherhood of Teamsters. Freight is not a stable business. Freight levels vary wildly from day to day, week to week and month to month. Union rules and contracts do not allow the flexibility necessary to compete in a deregulated, free market economy.
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Not exactly true...they have zero problems laying Teamsters off and cutting road driver's runs...also ups always has freight for contractors...
 
Razorblade said:
Someone has and is putting the pieces together. 20 years ago this month FedEx, a small package carrier, bought American Freightways. Now FedEx is the largest ltl carrier in the country and is still growing market share and profits. Powerhouse ltl carriers are not compatible with the International Brotherhood of Teamsters. Freight is not a stable business. Freight levels vary wildly from day to day, week to week and month to month. Union rules and contracts do not allow the flexibility necessary to compete in a deregulated, free market economy.
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There is some truth to your statement, but we can, and have to find a happy medium and it can be done. Agreed, the past powerhouse Union carriers had the Master Freight to deal with they were also horribly mismanaged. The them v us mentality was toxic.
The current UPGF contract is heavily weighted in favor of the Company, it allows management to allocate assets fairly easily, if only their arrogance would allow them to do it properly.
Respect and dignity is a two way street and a mutual respect between labor and management will go a long way toward "flexibility".
 
Crumudgeon said:
There is some truth to your statement, but we can, and have to find a happy medium and it can be done. Agreed, the past powerhouse Union carriers had the Master Freight to deal with they were also horribly mismanaged. The them v us mentality was toxic.
The current UPGF contract is heavily weighted in favor of the Company, it allows management to allocate assets fairly easily, if only their arrogance would allow them to do it properly.
Respect and dignity is a two way street and a mutual respect between labor and management will go a long way toward "flexibility".
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Decades ago Teamster freight companies kept their seniority lists tight. They used casuals on heavy days, typically Mondays and Fridays. In that way the seniority men always worked and the excess was handled by casuals. Also, lots of guys liked working casual because it gave them the freedom to work when they wanted to and be off when they wanted to. Of course back then casuals got scale since there was no "progression" in the pay rates. The change that ruined things was the "progressive" pay rates that were eventually voted in. Now being a casual wasn't desirable since the pay was greatly reduced even though you were doing the same work. Just another example of Teamster membership shooting themselves in the foot - "Hey, let's vote for lower pay for new guys, I'm already working so it doesn't affect me." Duh!!
 
Triplex said:
Decades ago Teamster freight companies kept their seniority lists tight. They used casuals on heavy days, typically Mondays and Fridays. In that way the seniority men always worked and the excess was handled by casuals. Also, lots of guys liked working casual because it gave them the freedom to work when they wanted to and be off when they wanted to. Of course back then casuals got scale since there was no "progression" in the pay rates. The change that ruined things was the "progressive" pay rates that were eventually voted in. Now being a casual wasn't desirable since the pay was greatly reduced even though you were doing the same work. Just another example of Teamster membership shooting themselves in the foot - "Hey, let's vote for lower pay for new guys, I'm already working so it doesn't affect me." Duh!!
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You brought up progression rates and I have been avoiding the issue.
The issue being, Yellow Freight hired me, and 49 other former Preston Trucking linehaul drivers in 1999 at 70% of the contract rate at Cleveland. If a company can hire 50 experienced drivers who can be immediately as productive as senior people, how much is the job worth? Nearly all of us were million milers and were triples qualified as soon as we had our 30 days in. If I am doing the job for 70 cents, why is the guy doing the same run worth $1.00? The answer is he is not. The Teamsters Union has set a pay scale for the job that makes it clear that senior people are overpaid. The International Brotherhood of Teamsters negotiated a contract that says this job is only worth 70% of the current rate of pay.
 
The ups freight master agreement ( soon to be TFI master agreement) is the most company friendly contract. Anyone with half a brain could make it work as a manager. Unfortunately, UPS Freight hires too many with less than half a brain.
The NMFA doesn't exist any longer, other than in name.
Turbo Freight won't be working by that standard.
 
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Razorblade said:
You brought up progression rates and I have been avoiding the issue.
The issue being, Yellow Freight hired me, and 49 other former Preston Trucking linehaul drivers in 1999 at 70% of the contract rate at Cleveland. If a company can hire 50 experienced drivers who can be immediately as productive as senior people, how much is the job worth? Nearly all of us were million milers and were triples qualified as soon as we had our 30 days in. If I am doing the job for 70 cents, why is the guy doing the same run worth $1.00? The answer is he is not. The Teamsters Union has set a pay scale for the job that makes it clear that senior people are overpaid. The International Brotherhood of Teamsters negotiated a contract that says this job is only worth 70% of the current rate of pay.
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The issues I've always had with Teamsters voting for reduced pay for new hires are these:
1) The people voting are deciding on something which doesn't affect them.
2) The people affected by the reduced pay didn't get to vote on it.
How can that be a democratic (lower case "d") way to decide things?

On another note, I learned a long time ago - A worker is only worth what someone else will accept for doing the same job.
 
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