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ABF | But Purchased Transportation Expense Climbed 35% Higher....

Sumting Wong

Sumting Wong

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Last week, Saia (NASDAQ: SAIA) reported tonnage increases for the first two months of the fourth quarter of 5.7% and 7.3%, respectively. Old Dominion Freight Line (NASDAQ: ODFL) reported a 6.3% year-over-year increase in November revenue, following a 2.6% increase during October. Results from YRC Worldwide (NASDAQ: YRCW) were more subdued but the carrier reported that revenue turned positive during November.

The LTL industry appears to finally be getting a little help from the industrial economy. The Purchasing Managers’ Index remained above the all-important 50% level for the sixth straight month in November at 57.5% and industrial production ticked 1.1% higher during October.

ArcBest’s asset-light unit reported a 33% year-over-year increase in revenue, but purchased transportation expense climbed 35% higher. The cost of capacity as a percentage of revenue has increased 100 basis points to 84% through the first two months of the quarter. High demand and a lack of truck capacity are keeping spot rates elevated, compressing logistics margins across the industry.

Key metrics for logistics provider ArcBest Corp. (NASDAQ: ARCB) showed that less-than-truckload demand improved again in November. The company’s Tuesday filing with the SEC noted that the positive trends previously reported in October remained in place during November.

The Fort Smith, Arkansas-based company reported a 9% year-over-year increase in November revenue in its asset-based division as tonnage increased 8% and revenue per hundredweight, or yield, was up 1%. Tonnage in the company’s LTL segment climbed double digits in the month, similar to the increase seen in October.

https://www.freightwaves.com/news/arcbest-continues-streak-of-positive-ltl-updates
 
"..... but purchased transportation expense climbed 35% higher. ....." I have been thinking for a couple of months now that this is why ABF is hiring. Purchased transportation is no longer cheaper than hiring their own drivers even with benefits.......
 
Homesick said:
No one is laid off at 086. At least not in the city, dock or line haul.
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And that's good........But my former terminal has guys laid off,....and apparently some of the other terminals do, too.....

My former terminal has eliminated the Relo-Cube trailer,....and all the UE runs,.......and shipped out the yard truck,....We used to be an NDXP,...no more nighttime dock work now.....

And before I retired as steward,...the TM wanted me to agree to a "third-party purchased transportation" deal....in case we ever had...."too much capacity...."
Absolutely not........
 
canaryinthemine said:
And that's good........But my former terminal has guys laid off,....and apparently some of the other terminals do, too.....

My former terminal has eliminated the Relo-Cube trailer,....and all the UE runs,.......and shipped out the yard truck,....We used to be an NDXP,...no more nighttime dock work now.....

And before I retired as steward,...the TM wanted me to agree to a "third-party purchased transportation" deal....in case we ever had...."too much capacity...."
Absolutely not........
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Wow. The last time i was through Greensburg it was a busy place, 24 hours a day I believe? I bet those senior guys that complained about the relo cube deliveries are sorry for the loss now. As you once said.... 'never refuse work....'
 
retired01776 said:
Wow. The last time i was through Greensburg it was a busy place, 24 hours a day I believe? I bet those senior guys that complained about the relo cube deliveries are sorry for the loss now. As you once said.... 'never refuse work....'
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Yeah.......I was the Number One senior guy who did a lot of the Relo-Cube work,.....just so I didn’t hear the weeping, wailing, and gnashing of teeth as Steward.....

When the Relo-Cubes were gone,.....I bumped a junior man off a peddle run,......

We used to have 11 guys on the seniority board........Now there’s 7,....with one, I think on call.

Oh, yeah,.......When they pulled the Relo-Cube trailer out,......I told the Labor man that if I ever saw a Relo-Cube anywhere in the four Counties we served,....I’d be filing a grievance with massive back pay.......
And he agreed I’d have the right to file that grievance......

Pittsburgh and Altoona both still have their Relo-Cubes,......and between them , Greensburg does not......

That large dock is a pretty empty place now.......
 
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As busy as that dock once was.......... with all the ue drivers swapping out loads all night long and now it is a ghost town? I remember when that terminal was a breakbulk many years ago, I forget who is was at the time though? But the worcester terminal I used to go to on my bid for 12 years and I remember how busy that was 24 hours a day and I was by there a few months ago and that was dark in the middle of the night. They had a full crew all night long at one time. Freight sure has changed.
 
retired01776 said:
As busy as that dock once was.......... with all the ue drivers swapping out loads all night long and now it is a ghost town? I remember when that terminal was a breakbulk many years ago, I forget who is was at the time though? But the worcester terminal I used to go to on my bid for 12 years and I remember how busy that was 24 hours a day and I was by there a few months ago and that was dark in the middle of the night. They had a full crew all night long at one time. Freight sure has changed.
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That dock was,...Leonard Bros., Carolina, Motor Freight( I worked for them in '77..), Consolidated Freightways, Roadway, Yellow,...and ABF. When I started with ABF in '92,...we had the same 6 doors squeezed into the middle of the dock that Motor Freight had in '77,......Yellow on one side, and CF on the other,....

And,....as you saw,...eventually ABF ended up with all 24 doors,.....and during the height of UE,...sometimes 24 doors weren't enough.....

Crickets, now....from what I'm told. Yet, FedEx opened up a 30 door terminal that's going gangbusters,......and Con-Way/XPO has been running their 30 door terminal at full-bore for at least two decades,....Both places have 30-40 man "seniority" lists....

Oh,....and UPSFreight/Overnite's 26 door terminal has kept at least 25 guys busy for decades, too.

Those three terminals are within 5 miles of ABF's.......So you can't say there ain't no freight,....Second-most populated County in W. Penna.

Like the picture,....Something missing.......
nEDT8ea.jpg
 
ltl1 said:
It says arc best asset light division AKA logistics. Not ABF
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You know,....you're right. It says the "asset-light unit" not only posted a 33% increase in revenues,...but it had a 35% increase in purchased transportation.

Good eye there, Driver. I guess we all should've read it more carefully.

But...."asset-light" still means the non-Union, trip-lease-it-out, contract-with-anyone segment of ArcBest. It would be nice to see them putting that much effort in the ABF part of ArcBest.
 
canaryinthemine said:
You know,....you're right. It says the "asset-light unit" not only posted a 33% increase in revenues,...but it had a 35% increase in purchased transportation.

Good eye there, Driver. I guess we all should've read it more carefully.

But...."asset-light" still means the non-Union, trip-lease-it-out, contract-with-anyone segment of ArcBest. It would be nice to see them putting that much effort in the ABF part of ArcBest.
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So it looks like to me the master plan of putting ABF Freight to sleep is not working so well. Our revenue triples light asset every quarter & seeing how busy we are i can see that increasing even more....
 
canaryinthemine said:
You know,....you're right. It says the "asset-light unit" not only posted a 33% increase in revenues,...but it had a 35% increase in purchased transportation.

Good eye there, Driver. I guess we all should've read it more carefully.

But...."asset-light" still means the non-Union, trip-lease-it-out, contract-with-anyone segment of ArcBest. It would be nice to see them putting that much effort in the ABF part of ArcBest.
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Agree 100%.
 
canaryinthemine said:
Yeah.......I was the Number One senior guy who did a lot of the Relo-Cube work,.....just so I didn’t hear the weeping, wailing, and gnashing of teeth as Steward.....

When the Relo-Cubes were gone,.....I bumped a junior man off a peddle run,......

We used to have 11 guys on the seniority board........Now there’s 7,....with one, I think on call.

Oh, yeah,.......When they pulled the Relo-Cube trailer out,......I told the Labor man that if I ever saw a Relo-Cube anywhere in the four Counties we served,....I’d be filing a grievance with massive back pay.......
And he agreed I’d have the right to file that grievance......

Pittsburgh and Altoona both still have their Relo-Cubes,......and between them , Greensburg does not......

That large dock is a pretty empty place now.......
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is ArcBest out of the ReLo Cube business?? I hated those things, BUT, they paid me by the minute!
 
6PakAbs said:
is ArcBest out of the ReLo Cube business?? I hated those things, BUT, they paid me by the minute!
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There are piles of them in the Midwest. I think everyone hates those things. I heard the salesman talk people into them just to torture the city guys! LOL
 
6PakAbs said:
is ArcBest out of the ReLo Cube business?? I hated those things, BUT, they paid me by the minute!
Click to expand...

I don't think so,......What I do know is that the year before I retired, they decided to yank our Relo-Cube trailer out of our terminal. Altoona, Pa. still has their two-Cube trailer,....and Pittsburgh still has their 4-Cube trailer. Both terminals are east and west of Greensburg, Pa.
The reason given was that the Greensburg area...."didn't produce enough business in Relo-Cubes" ....to justify having a trailer there.
Funny,.....there are several Universities located in our area, along with the second-most populous County in Western Penna.
And we covered four Counties.....Westmoreland, Somerset, Indiana, and Fayette.

We had a few guys that would complain bitterly if they had to take Relo-Cubes out,.....claiming it was "dangerous and unsafe...".....Several times they had problems getting the towmotor stuck,....for hours,....backing off the pavement,....or driving up gravel driveways.
I ended up taking many of the Relo-Cube deliveries,.....Being the Steward, I had to prosecute any sort of claim of "unsafe"...and take them seriously. I would insist the company provide safety vests, lights, flags, proper training on DOT chaining requirements,....and made sure that,....any driver who made the determination that, for Safety,....Two men would be on the delivery,...in case of traffic or access problems. Two UNION men,....not (untrained) management......

As a former car-hauler,..with steel-hauling flatbed experience,....I figured I would cut down on Safety issues,....if I took the loads, and held ABF to what I considered the highest safety standards,.....(Cones set out, triangles, roof on the towmotor, lights on the towmotor, safety vests, flags, proper parking,.....and in instances of heavy traffic,.....another (Union) man spotting me.....)..

I also promoted use of the flatbed for,....other loads. We had a Quickrete cement plant that didn't have a dock,...and you'd have to pallet-jack several 4,000 lb. skids to the nose of the trailer.
And ...other loads. Creative thinking,.....We are Truck Drivers,....Union Truck Drivers, no less...We're supposed to be the "cream of the crop",.....and be able to load, and deliver ANYTHING,....Safely!

I suspect a few drivers complained constantly about Relo-Cubes,...In spite of the fact that ...MANY OTHER terminals are running these Cubes.....And the company just finally,......"agreed" with them.....
Again,.....You DON'T give up Work,....Whether it's switching road drivers, or night time dock,...or home deliveries,...or Relo-Cubes,...or U-Packs......Allow it to be sub-contracted, or done by someone else, and you'll never get it back....
 
canaryinthemine said:
I don't think so,......What I do know is that the year before I retired, they decided to yank our Relo-Cube trailer out of our terminal. Altoona, Pa. still has their two-Cube trailer,....and Pittsburgh still has their 4-Cube trailer. Both terminals are east and west of Greensburg, Pa.
The reason given was that the Greensburg area...."didn't produce enough business in Relo-Cubes" ....to justify having a trailer there.
Funny,.....there are several Universities located in our area, along with the second-most populous County in Western Penna.
And we covered four Counties.....Westmoreland, Somerset, Indiana, and Fayette.

We had a few guys that would complain bitterly if they had to take Relo-Cubes out,.....claiming it was "dangerous and unsafe...".....Several times they had problems getting the towmotor stuck,....for hours,....backing off the pavement,....or driving up gravel driveways.
I ended up taking many of the Relo-Cube deliveries,.....Being the Steward, I had to prosecute any sort of claim of "unsafe"...and take them seriously. I would insist the company provide safety vests, lights, flags, proper training on DOT chaining requirements,....and made sure that,....any driver who made the determination that, for Safety,....Two men would be on the delivery,...in case of traffic or access problems. Two UNION men,....not (untrained) management......

As a former car-hauler,..with steel-hauling flatbed experience,....I figured I would cut down on Safety issues,....if I took the loads, and held ABF to what I considered the highest safety standards,.....(Cones set out, triangles, roof on the towmotor, lights on the towmotor, safety vests, flags, proper parking,.....and in instances of heavy traffic,.....another (Union) man spotting me.....)..

I also promoted use of the flatbed for,....other loads. We had a Quickrete cement plant that didn't have a dock,...and you'd have to pallet-jack several 4,000 lb. skids to the nose of the trailer.
And ...other loads. Creative thinking,.....We are Truck Drivers,....Union Truck Drivers, no less...We're supposed to be the "cream of the crop",.....and be able to load, and deliver ANYTHING,....Safely!

I suspect a few drivers complained constantly about Relo-Cubes,...In spite of the fact that ...MANY OTHER terminals are running these Cubes.....And the company just finally,......"agreed" with them.....
Again,.....You DON'T give up Work,....Whether it's switching road drivers, or night time dock,...or home deliveries,...or Relo-Cubes,...or U-Packs......Allow it to be sub-contracted, or done by someone else, and you'll never get it back....
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Steward just filed a grievance on relo cubes today, a vendor came in with a rollback & took two out for delivery last week....
 
GO40 said:
Steward just filed a grievance on relo cubes today, a vendor came in with a rollback & took two out for delivery last week....
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Well,......Before our trailer got taken out,....I had heard from some through road drivers that some terminals on the East Coast had put up such resistance to Relo-Cubes,...that the company in those areas subcontracts ALL of their Cube work out to whoever bids on it,....
And people did,...rolloffs,...trailers,....
And,...the work went away.

When they informed us that our trailer was going,.....I had a long "conversation" with the Labor man,....He said that the company had a ....right to change or alter the Relo-Cube business, as it is technically part of...U-Pack, a subsidiary of ArcBest......NOT ABF...
Technically,...ABF employees are doing work for U-Pack,...therefore, the work can be altered or modified as they saw fit.

As we had...."established"...we were doing the Cube work,...I told him that, if we ever saw a Cube within the 4 Counties we serviced,...there would be a subcontracting grievance. He agreed we had the right to....file that grievance.
(Think we'd win that one, Ernie?...)

A Union has a responsibility to make,...and PROTECT,...as much work as we can handle. You study up on FMSCA and DOT rules,....and operate the Relo-Cube trailer within the laws.....
 
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