Both companies and trucking industry brace for long haul in Teamsters strike

April 07, 1994|By John E. Woodruff | John E. Woodruff,Sun Staff Writer

Drivers and company officials agree that the first nationwide Teamsters union strike since 1979 will only make things harder for everybody in a segment of the trucking industry that is already fading.

Yet both sides say the stakes are so high that they also agree on one more point -- the strike, which pulled more than 75,000 workers off the job and closed 22 trucking firms yesterday, is likely to be long and hard-fought.

"In this business, at this time, a strike is a lose-lose proposition -- no winners anywhere -- but the companies are demanding concessions that make it a life-or-death struggle for us," said Tony Bills, 57, a Baltimore career truck driver who was walking a picket line yesterday afternoon with half a dozen other men from Teamsters Local 557, Baltimore's biggest.

"There is no way we can hope to guarantee union workers their jobs if we don't get some concessions that give us more flexibility and more competitiveness," said Linda George, a spokesman for Preston Trucking Co. Inc.

To sweeten their demands for current union members, the companies offered raises amounting to more than 13 percent over the three years of the contract.

"Money is not the issue here. What's at stake is whether the companies will ever again hire another full-time employee," said Robert Imbrogulio, 52, the Local 557 shop steward at Roadway's East Lombard Street terminal.

The union threw up picket lines yesterday morning, just after midnight, to fight company demands that part-timers, paid just over half the union's current $17.16 an hour and no benefits, be given a growing share of work at truck terminals over the next three years. Also riling union leaders and members is a company demand that an increasing share of the industry's freight trailers be moved by rail.

In the Baltimore area, an estimated 2,500 drivers and freight handlers, about a 10th of the city's Teamsters, went out, more than 1,200 of them members of Local 557. That local alone was maintaining picket lines at 42 terminals and satellite locations owned by the 22 companies.

The companies being struck include many names long familiar to Maryland highway motorists -- Roadway Services Inc., Consolidated Freightways, Yellow Freight System Inc. and Preston Trucking.

Their business is to carry shipments too small to constitute a full load, and most of what they haul is raw materials, parts and unfinished products, so no one expects consumers to feel much immediate impact from the strike.

Even many of the businesses that use them may feel little immediate impact, because union companies account for less than half of their market and few customers will have difficulty finding other carriers.

"The market segment inhabited by LTL carriers [less than full load] is a shrinking market segment. The current dispute will accelerate that process," said Mary Elizabeth Pfeil, a transportation industry analyst for PNC Bank Corp. in Philadelphia.

The industry, still reeling from the recession, had yet another round of earnings problems in the first quarter of this year, mainly due to weather problems. Until yesterday, hopes had been that recovery would begin this quarter.

The union, too, has been torn in recent years by strife between reformers led by president Ron Carey and old-guard Teamsters officials who still hold many key posts.

The once-formidable union's finances are so shaky that Mr. Carey had to float $80 million in loans, mainly from Teamster-controlled insurance sources, to rebuild the strike fund.

Analysts estimate that some of the struck companies could lose up to $1 million a day for the duration of the strike.

That prospect, and uncertainty over how long the strike might last, made stocks of some of the companies volatile through much of yesterday's trading, though by day's end most closed only slightly lower.

Yellow Corp., parent of Preston and Yellow Freight, ended down cents at $23.5625 in Nasdaq trading. Consolidated closed down 62.5 cents at $26.625 on the New York Stock Exchange. And Roadway fell 50 cents to $67.50 on Nasdaq.

By last night, neither side saw any prospect of soon resuming negotiations, which broke off last week with the companies refusing to improve their "final" offer and the union leadership refusing to put it before the members for a vote.

"I think the companies may have miscalculated, when an internal dispute ended with the members voting down an increase in dues to rebuild the strike fund," said John Clemens, president of Local 557.

"Now it's clear that the union can't give what the companies are demanding, and we're just going to have to hang on until they ask for negotiations," he added.

"There is no way the companies are going to make the first move -- the offer they made should be put before the union membership to let them decide," said Ann Banville, a spokeswoman for Trucking Management Inc., which represents the companies in the negotiations.

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