What's next for YRC Worldwide?
When all the votes were counted, the news wasn't good for YRC Worldwide Inc., the trucking conglomerate that has a significant workforce in Central Pennsylvania.
YRC's workers, represented by the Teamsters, rejected the latest contract offer with 61 percent turning it down. That puts the company's credit in serious question, as well as the company's future and that of its 26,000 employees.
The Teamsters union has the full vote count on its website.
That includes its Cumberland County warehouse workers, its small contingent of Lancaster workers and those who work at its regional trucking firm, New Penn Motor Express Inc. in Lebanon.
Here's how the Central Pennsylvania unions voted on the latest contract offer:
• Local 776, Harrisburg: 268 for offer, 381 against it.
• Local 771, Lancaster: 2 for offer, 1 against it.
The company says it is reviewing its options after the vote and talking with Teamster leaders.
Credit rating agencies seem to be betting against YRC to remain in business and have downgraded its rating outlook, according to this story.
I once had an analyst tell me that filing for even Chapter 11 bankruptcy reorganization was a death sentence in the trucking industry, because clients jump ship faster than anywhere else. They don't want their products stuck in a warehouse somewhere if their trucking company goes axles up, so they move to the competition.
If company and union leadership, and YRC's creditors, can't work out some form of compromise, then there are real possibilities hundreds more people in Pennsylvania would be out of work.
How long depends a lot on their positions. Truck drivers looking for work at large truckload carriers have a quarterly turnover rate of 97 percent in their favor, according to the American Trucking Associations quarterly report. In other words, there's a driver shortage, and turnover is high because drivers know they can get a better deal at the company on the other side of the fence.
But drivers in the more stable less-than-truckload world face turnover rates of 13 percent, according to ATA. That means there are fewer available jobs, because drivers stay longer at those companies.
It's not a pretty picture, unless you're a competitor of YRC and looking to pick up some of its business. Or experienced employees.
But the bell hasn't tolled just yet, according to a statement YRC issued Thursday. It intends to renegotiate the proposed contract with its union leaders.
"It is clear the Teamsters understand the urgency of the current situation," YRC Worldwide CEO James Welch said in the statement. "Although the company must achieve operational costs savings in the agreement, we also understand that simply re-voting the same proposal is not an option."