USF to Close Its Red Star Unit

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ransportation firm USF Corp. said Sunday it would close USF Red Star, one of its regional less-than-truckload carrier units.

The company said in a statement a Teamsters strike that began on Friday in a bid to get 15 Philadelphia office workers to join the union, “had triggered a loss of customers and revenue to a point where Red Star would never be able to recover.”

The company said that following the strike in Philadelphia, picket lines were established at all Red Star locations in United States and Canada, covering more than 1,500 drivers and dock workers.

USF's Red Star has lost money from operations for at least three years. Sales fell 14% last year to $228.5 million and losses were $5.1 million in 2003, $6.7 million in 2002 and $3.4 million in 2001.

The shutdown was the biggest since Consolidated Freightways Corp. closed in September 2002, shedding more than 12,000 Teamsters jobs, as it sought bankruptcy protection, Bloomberg reported.

Closing Red Star will cost $50 million to $55 million in the second quarter, Bloomberg reported.

USF is ranked No. 10 on the Transport Topics 100 list of the largest U.S. and Canadian trucking companies.