The last legacy LTL standing

August 15, 2023

John Bendel


Yellow Corp. is gone, and with it the last threads of a long-ago trucking era. Almost, anyway. There’s still one thread left. We’ll come back to that.

That era, when large less-than-truckload carriers and the Teamsters union dominated commercial trucking, ended with deregulation – the Motor Carrier Act of 1980.

I know, I know. Not deregulation again. Bear with me, because even in our industry, not many people understand just how massive a change it was and what a wonder it is that Yellow survived as long as it did.

Back in the old days, G.R. Leonard & Co. published the Motor Freight Directory, commonly called Leonard’s Guide, with a different edition for each of six major metro areas. So if you were in, say, Chicago, and you had a shipment for Mudbump, Ala., you would look up Mudbump to see a list of carriers with the authority to deliver there from Chicago. It was extremely handy, if not indispensable, for any company that shipped LTL – and that was almost everybody.

Each guide edition included a separate list of all the carriers cited in that particular directory. I still have a Leonard’s guide, New York edition, from 1968, and that list includes 450 carriers.

I’m sure you know prominent truckload carriers that trace their roots to well before regulation. Back in the day, many operated as contract carriers for specific shippers. Others hauled exempt freight, commodities not covered by regulation, such as produce and perishable food. They aren’t in my 1968 guide, just those 450 LTLs. What happened to them?

They’re gone – all 450.

When President Jimmy Carter signed the Motor Carrier Act of 1980, it was like a controlled demolition.

A complex regulatory structure, in place for nearly 50 years, simply vanished in a puff of smoke and a cloud of dust, all at once.

Almost, anyway. The Interstate Commerce Commission that once ruled trucking still existed, as did some level of regulation. But the door was wide open for new companies, most of them truckload carriers that, for all practical purposes, could pick up and deliver anything anywhere. The complex framework of operating authority by geography and commodity was gone.

While the framework had vanished, the motor carriers built within it were still there. But like the dust from a demolition, they didn’t last long. Those carriers were Teamster LTLs, some of which had grown enormously in coverage and volume with the Interstate Highway System in the 1960s and 1970s.

Suddenly, the operating authority they had likely acquired piece by expensive piece over years and that bankers considered a tangible asset was worthless. Studies have pegged the industry-wide loss of equity in the billions or even hundreds of billions of dollars. This created financial constraints for some carriers, and it was just the beginning.

Out on the street, the LTLs were no match for nimble truckload carriers, including lots of new ones that began springing up.

First, the new truckload carriers took what truckload business the LTLs handled. They did it directly, door-to-door and for a lot less money.

Then, they took away large shipments the LTLs used as headers, shipments loaded in the nose of a trailer. Ideally, the trailer would be routed so at the other end of the move the header was the last delivery stop on a local run. That large shipment would not have to be handled between pickup and delivery.

Truckload carriers did it simpler and faster. They simply treated those shipments as truckloads, door-to-door, faster and cheaper.

Sometimes, those large LTL shipments weren’t all that large. Truckload operating costs were so low – largely due to lousy, mileage-based driver pay – that a 53-foot trailer might carry no more than a pallet or two for about the same price an LTL would charge, or maybe just a bit more. But they would move it door-to-door, overnight.

Soon, the few non-union LTLs, most based in anti-union southern states, began growing and expanding into new territories, nibbling away at Teamster freight. And as if that weren’t enough, UPS began accepting larger shipments. This ate into the small, often retail deliveries the LTLs called minis, named for the minimum freight charge that usually applied.

No wonder, then, that the old LTLs began merging or falling by the wayside. In order to compete, many negotiated driver givebacks. Driver pay froze or declined, but the givebacks were never enough, and legacy LTLs continued to die off. Some shut down, waving goodbye to their union employees, then reopened across town under a new name with a non-union crew.

Big-time LTL Consolidated Freightways, noting the handwriting on the wall, started a parallel non-union LTL called Conway, now known as XPO.

Meanwhile, the original Consolidated struggled on before finally perishing in a spectacular 2002 bankruptcy. Its dirty, dilapidated, duct-taped fleet had become a spectacle all by itself.

That didn’t happen with Yellow, in part due to the controversial $700 million government loan it received in 2020, at least half of which was used to buy new equipment.

So, if Yellow wasn’t the last of the Teamster LTLs from the regulated eta, who is?

Two large, union LTLs exist these days: ABF Freight and TForce Freight. Both recently negotiated new contracts with the Teamsters, but one has a disqualifying pedigree.

TForce Freight, which belongs to the burgeoning trucking empire TFI International, was purchased from UPS in 2021. UPS had owned the company since 2005, when it became a Teamster carrier. Before that, it was known as Overnite Transportation, one of the largest non-union LTLs in the country. Yes, Overnite was around during the regulated era, but not as a Teamster carrier.

So that leaves ABF Freight of Fort Smith, Ark., which was organized by the Teamsters in the late 1940s.

ABF has always flown pretty much below my personal radar, but it has been growing all along. Ranking No. 14 on Transport Topics Top 100 For-Hire Carriers, ABF fields more than 4,000 tractors and more than 23,000 trailers. It has nearly $4 billion in annual revenue.

Still, it doesn’t make headlines, at least not the bad kind. And it’s obviously keeping its customers happy. I hope that goes for its employees, too.

I also hope ABF regards its standing as the last legacy LTL as a badge of honor. If nothing else, it proves it’s doing something right. LL

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