Friday, June 25, 2010

YRC Worldwide Isn't Giving Up

Management at YRCW hasn't given up.  They need cash to pay the company's bills:

Struggling less-than-truckload giant YRC Worldwide said it will sell part of its YRC Logistics operation for $37 million to private equity investor Austin Ventures and partner with that firm on some overseas trade services.

There's nothing wrong with selling assets as long as using the cash to fund what you have left will get you back to profitability.  What's left is going to be tied to 3PL brokers:

Eventually, it plans to launch new products and services with 3PL partners and closely integrate its less-than-truckload operations into their supply chain networks.

That's actually a pretty smart move!  YRCW can save money on the "last mile" by delivering to local freight forwarders instead of door-to-door at the end customer.  This will cut idle time for drivers and thus cap their driving hours.  This strikes at the heart of those intransigent Teamsters who've been killing YRCW's regional units by not budging on wage cuts.

YRCW, there may be some life left in you yet.  Use those 3PL brokers as a club to hit your unionized drivers and you can turn this thing around.

Full disclosure:  No position in YRCW.