Dive Brief:
- U.S. Xpress is reducing its workforce by up to 10% across the company, part of an expansive corporate cost-cutting plan that also involves pulling back on capital expenditures, the TL carrier confirmed to Transport Dive Tuesday.
- The company is evaluating “a wide range of systems, programs, projects and teams across the enterprise,” U.S. Xpress spokesperson Brad Carmony said in an emailed statement. It is also reviewing its investments in real estate, vendors, benefits, overtime, offshoring, temporary workers, contractors and other fixed costs.
- The layoffs at U.S. Xpress followed a 25.5% YoY surge in labor costs in Q2. The carrier spent $181.4 million in salaries, wages and benefits during the quarter.
Dive Insight:
U.S. Xpress is seeking to better match its capacity to cooling demand. A significant decrease in spot market rates left the carrier with lower fuel surcharge revenue, which was a $15 million headwind in Q2, Peterson told investors.
Labor costs, meanwhile, have been consistently rising, increasing 4.8% in 2020 and 11.4% in 2021, according to an annual report.
U.S. Xpress eliminated 70 corporate and IT employees in May, reducing about 5% of the headcount at the company’s Tennessee headquarters, the Chattanooga Times Free Press reported. Those layoffs did not affect drivers, mechanics or maintenance workers, Carmony told the newspaper.
This time, layoffs will cut across the organization's non-driver-facing roles. But the company has also reassigned workers and eliminated a “small number of positions” from the driver onboarding program, Carmony confirmed.
“Earlier this year, we began a multi-phased restructuring including leadership changes, a reduction in force, and a hiring freeze,” Carmony wrote. “Through this process, U.S. Xpress is evolving into a leaner, more disciplined company.”
As of Dec. 31, the company employed approximately 8,689 non-union employees, which included nearly 6,000 drivers, 300-plus maintenance drivers and more than 2,400 office employees, according to an annual report.
