RICHFIELD, Ohio (AP) - Consolidated Freightways workers in Ohio knew the company was in financial trouble but did not expect it would go out of business, union leaders said on Tuesday, the day after learning U.S. operations would shut down.
"It is a very unfortunate situation," said Tony Jones, secretary-treasurer of Teamsters Local 413 in Columbus, which has 350 members who work for the shipping company. "It's a real kick in the face of our members."
The Vancouver, Wash., based company said on Monday that it would stop operations immediately, affecting about 15,500 employees, including at least 1,100 at truck terminals in eight Ohio cities, the biggest of which is in Richfield, where 600 people were employed.
In a recorded telephone message, Chief Executive John Brincko told workers not to show up Tuesday.
"Thank you for dialing in on this holiday weekend. I hope you and your family are enjoying the time together," said Brincko, who was named chief executive three months ago. "I have some extremely urgent and sad news to share with you today. ... Your employment ends immediately."
The company said more than 80 percent of its work force were receiving termination notices immediately. The remaining supervisory and management positions were to be phased out quickly.
The 73-year-old company said it would file for Chapter 11 bankruptcy protection on Tuesday.
Phone listings show eight Consolidated Freightways operations in Ohio: Columbus, Dayton, Toledo, Lima; Richfield and Girard in northeast Ohio, the Cincinnati suburb of West Chester and Belpre in southeast Ohio.
Teamster Local 100 members in the Cincinnati area speculated that bad news was possible when the company abruptly canceled a vote asking workers to give up 12.5 percent of their wages, Jim Reed, secretary-treasurer of the local, said on Tuesday.
"Then everybody had sort of a bad feeling about what was going to happen," Reed said.
Travis Bornstein, president of Teamsters Local 24, which represents 600 drivers, mechanics and office workers at the Richfield terminal, said the shutdown came as a surprise.
"We weren't prepared for the company to go out of business but we knew the company was struggling financially," he said.
Teamsters officials said they hope workers will be able to get other jobs despite the economic downturn.
"We're getting into the peak of freight season now," said Bill Lichtenwald, president of Teamsters Local 20, which represents about 30 Toledo drivers.
Ed Cordts, a 21-year employee in Columbus, was not as optimistic.
"It's going to be rough getting a job, especially a Teamster's job, because there are a lot of people out. It's going to be a competitive market," he said.
Consolidated lost $36.5 million on $463 million in revenue in the first quarter of this year. It lost $104.3 million last year and $7.6 million in 2000.
Its stock had tumbled in the past two weeks, since it announced it might lose its listing on the Nasdaq stock market. In letters being mailed to workers, the company said it simply didn't have enough money to continue operations.
"We expected that recent discussions with our banks, other lenders and real estate investors would enable us to obtain significant additional financial resources," the letters said. "Unfortunately, this has not been the case."
Operations of the company's CF AirFreight and Canadian Freightways Ltd. subsidiaries were not affected.
Consolidated Freightways billed itself at the nation's third-largest "less-than-truckload" carrier. It took partial shipments from multiple companies, loaded them together and trucked them throughout North America.
It has 350 terminals and 30,000 trucks in the United States, Canada and Mexico.
The company's stock traded on the Nasdaq stock market at more than $18 in early 1999, but closed at just 71 cents Friday.
The country's largest less-than-truckload carrier is Yellow Corp. of Overland Park, Kan., followed by Roadway Corp. of Akron, Ohio.