Teamsters to strike bankrupt hauler

Hoffa sends a message to judges

The International Brotherhood of Teamsters said Friday they would strike a Michigan-based car hauler after a federal bankruptcy judge agreed to let the company temporarily cut the pay of union drivers.

Performance Transportation Services, the No. 2 car hauler in the United States, won court permission to immediately impose a 15-percent pay cut on 1,250 Teamster drivers through July 31. The company's president and CEO, Jeff Cornish, said in a Detroit News interview Thursday that the company would go to court to seek an injunction halting what it said would be an "illegal strike."

A walkout, set to begin at 9 a.m. Monday, could halt vehicle deliveries for automakers that use the Allen Park-based company, which delivers 2.7 million vehicles a year. Ninety-five percent of its business -- 10,400 vehicles a day -- comes from General Motors Corp., Ford Motor Co. and Toyota Motor Corp. The automakers said they are monitoring the situation and preparing plans in the event of a strike.

"We are striking to enforce our bargaining table positions on wages, hours and related issues," Fred Zuckerman, the Teamsters chief negotiator and car-haul division director, said on Friday. He said local unions unanimously OK'd the strike.

The union membership, which includes about 350 PTS workers in Michigan, last week authorized a strike by a 3-1 vote.

Cornish told employees in a letter Wednesday that the pay cuts were necessary "to give us time to bargain separately with the IBT," and that a new contract "will allow us to move forward to a plan of reorganization which will provide long-term, secure jobs for our employees."

PTS first filed for bankruptcy in January 2006. The company again filed for bankruptcy protection in November 2007, citing high fuel prices, the declining auto market and bad weather that made hauling more expensive. Cornish said PTS is looking for concessions similar to those won by the nation's largest car hauler, Allied Holdings, which filed for bankruptcy in 2007, and imposed a 17.5 percent pay cut on workers.

"This option was the only one available to us to try to save the company," Cornish said.

Car haulers have faced a shrinking volume of vehicles for delivery as the auto industry faces its worst sales year in a decade. More competition from railroads and skyrocketing diesel prices also are challenging the hauling industry.

"You have to eat a lot of those costs," Cornish said, noting the company has a fleet of 1,300 tractor-trailers. "We have faced a lot of difficult cost swings."


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