Talk about change is an industry staple, but who could have predicted the events of 1997?
Every year brings a few surprises, but for trucking, 1997 has delivered more unexpected twists and turns than a cow path country road.
Start with organized labor. The Teamsters went into the year in high spirits, looking for a chance to show off their rediscovered solidarity and muscle under a leader the members seemed to trust. They carried out a strike against their largest employer and proved that they weren't in the mood to buy competitive pressure arguments. They dealt UPS a serious blow, and it looked like LTL carriers were next.
Suddenly last month, a judge ruled that their reform leadership wasn't reformed enough. Not only has Ron Carey's election been nullified for campaign financing abuses, but he's also been declared unfit to even run in a new election. As we end 1997, the large carriers face contract talks with a Teamsters union in complete turmoil and most likely once again under the leadership of a Hoffa. Of course, another court ruling or two could completely change the situation again.
The organized business side of trucking is also dealing with a major leadership change, although the circumstances are nowhere near as dramatic. Late this year, Tom Donohue, the highly visible head of the American Tucking Assns., left trucking's largest political organization to take over an even larger business lobbying group. Donohue deserves credit for bringing a lot of energy back to ATA's activities, and he never shrank from the spotlight when it came time to defend or advance what he saw as the industry's best interests. He also stepped on a lot of toes, alienating some supplier and fleet members, and had a less than sterling record when it came to influencing actual legislation.
The new ATA head, Walter McCormick, seems to be cut from very different cloth. Even though he was already on the new job, Donohue was working the floor hard at the ATA's annual convention in October. McCormick, who was officially named as the new president during the convention, didn't even make a public appearance. He is, however, considered a political insider, having served as a legislative aide to former Sen. John Danforth and as general counsel for the Dept. of Transportation. It certainly looks like ATA members are going to see major changes in that organization.
Ford's decision to get out of the heavy truck business and Freightliner's decision to buy Ford's recently introduced HN-80 heavy truck line certainly qualifies as an unexpected turn of events. In hindsight, the move makes perfect sense for both parties, but the deal was negotiated so quickly and so quietly that everyone was taken by surprise. And who would have ever predicted that long-term rivals Eaton and Dana would begin swapping component businesses like two kids trading baseball cards?
Major mergers and acquisitions also rocked the carrier side of the industry with consequences that are still far from clear for both private and for-hire fleets.
For example, with the mega-merger of Union Pacific and Southern Pacific, the railroad industry seemed headed into 1997 in its strongest competitive shape in many years. Instead of taking freight from trucking, the railroads collapsed under the complexity of trying to combine two very different operational styles and information systems. And trucking is picking up new freight volume as shippers flee from the resulting service nightmares.
Then just three months ago, Federal Express announced that it was going to recreate itself by buying Caliber System, a collection of trucking operations that included a major regional carrier, an expedited shipment carrier, and a small-package carrier. If it can avoid the pitfalls that bedevil Union Pacific's merger, FedEx could go from being a successful overnight package operation to a national expedited distribution company with the potential to reshape LTL and truckload carriage as well as pose a new threat to many types of private fleet operations.
The year has certainly been "a long, strange trip." And I, for one, have learned enough to avoid making any predictions about next year.
