The news: ArcBest will cut about 2% of its workforce, close 10 ABF Freight terminals, and retire the MoLo and Panther brand names in August. The company expects about $40 million in annual savings.
The details: The 10 terminals are in smaller markets and hold about 1% of ABF's dock doors. Their freight will shift to other facilities in the same regions.
The one-time costs:
$6 million to $7 million in cash charges, mostly this quarter.
$76.5 million in non-cash writedowns, including $25.7 million for the Panther trade name.
MoLo is the truckload brokerage ArcBest bought in 2021. Panther is its expedited unit. Both keep operating under the ArcBest name.
The backdrop: ArcBest was a buyer in the last LTL shakeout. It picked up more than a dozen terminals from Yellow’s 2023 bankruptcy, including a 108-door site in Denver.
Even after these closures, ArcBest will have about 8% more dock doors than it did in 2021. Its tonnage keeps growing. Rival Saia is still opening terminals on former Yellow real estate.
The freight is getting less profitable, though. Revenue at ArcBest's core LTL unit rose about 1% in the first quarter, but operating income fell roughly a third as costs outran the extra volume.
What's next: The closures count as a change of operations under the Teamsters contract, so a joint union-management committee has to approve them. ArcBest reports second-quarter results later this month.
