Major Trucker Skids Off The Road

Consolidated Freightways, one of the nation's largest trucking companies, decided to shut down its U.S. operations after 73 years, saying on Labor Day that about 15,500 workers would lose their jobs.

Hundreds showed up for work on the holiday only to find the offices locked, according to a union spokesman, who called it "a slap in the face."

"That's like telling your wife you're getting divorced on Valentine's Day," said Carlos N. Ramos, a spokesman for Teamsters Local 776 in Harrisburg, Pa.

The company said it would stop U.S. operations immediately. Operations of the company's CF AirFreight and Canadian Freightways Ltd. subsidiaries were not affected.

About 15,500 employees would be affected, the company said, with more than 80 percent receiving termination notices immediately. The remaining supervisory and management positions will be phased out quickly.

In a recorded telephone message, Chief Executive John Brincko told workers at the trucking company not to show up Tuesday.

"Thank you for dialing in on this holiday weekend. I hope you and your family are enjoying the time together," said Brincko, who was named chief executive three months ago. "I have some extremely urgent and sad news to share with you today...Your employment ends immediately."

The 73-year-old company said it would file for Chapter 11 bankruptcy protection on Tuesday.

The Vancouver, Wash., company lost $36.5 million on $463 million in revenue in the first quarter of this year. It lost $104.3 million last year and $7.6 million in 2000.

Its stock had tumbled in the past two weeks, ever since it announced it might lose its listing on the Nasdaq stock market.

In letters being mailed to workers, the company said it simply didn't have enough money to continue operations.

"We expected that recent discussions with our banks, other lenders and real estate investors would enable us to obtain significant additional financial resources," the letters said. "Unfortunately, this has not been the case."

"It's a real sad Labor Day here at the Teamsters," Bret Caldwell, a spokesman for the International Brotherhood of Teamsters in Washington, D.C., told CBS Radio News.

He said Consolidated had faced "some serious management challenges over the past several years." He said Brincko was "trying to turn the ship around, but he was just brought in too late to have the real impact he could have had."

Caldwell said the union would try to find work for its laid-off members.

"It won't be easy," he admitted. "However, with other companies in need of experienced drivers, we hope to get as many of them on the road as soon as possible."

Driver Charles A. Perrin, 57, of Sturgis, Mich., said the closing did not surprise him because the company had told workers of its financial problems.

"I wasn't thinking anything good about it," said Perrin, who works at a terminal in Elkhart, Ind. "A lot of others were hoping it would be different."

Travis Bornstein, president of Teamsters Local 24, which represents 600 drivers, mechanics and office workers at the Richfield, Ohio, terminal, said the shutdown came as a surprise.

"We weren't prepared for the company to go out of business but we knew the company was struggling financially," he said.

He called an emergency union board meeting for Tuesday to discuss the shutdown and try to arrange for employees to get paid for work done over the past two weeks and for vacation time earned.

Teamsters officials in Columbus and Toledo said workers should not have problems finding jobs despite the economic downturn.

"We're getting into the peak of freight season now," said Bill Lichtenwald, president of Teamsters Local 20, which represents about 30 Toledo drivers. The Columbus terminal employs about 350 workers, and the Lima site had a handful, union officials said.

Ed Cordts, a 21-year employee of the Columbus site, was not as optimistic about finding a new job.

"It's going to be rough getting a job, especially a Teamster's job, because there are a lot of people out. It's going to be a competitive market," he said.

Consolidated Freightways billed itself at the nation's third-largest "less-than-truckload" carrier. It took partial shipments from multiple companies, loaded them together and trucked them throughout North America.

It has 350 terminals and 30,000 trucks in the United States, Canada and Mexico.

The company's stock traded on the Nasdaq stock market at more than $18 in early 1999, but closed at just 71 cents Friday.

The country's largest less-than-truckload carrier is Yellow Corp. of Overland Park, Kan., followed by Roadway Corp. of Akron, Ohio.