A number of factors have resulted in Jevic Transportation having to close its doors after 27 years of operations. The company said they would finish all current freight deliveries within its system before shutting it all down. It isn't accepting any more pickup requests.
David H. Gorman, president and CEO, said in a letter:
"I regret to inform you that Jevic Transportation Inc. will be discontinuing operations. The current high fuel costs, economic downturn, increasing insurance costs, and tightening credit markets have made this decision necessary. Jevic will stop providing pickup service effective Monday 5/19/08. However, we will continue operating to deliver all freight within our system prior to closing."
Other factors not mentioned was they paid their workers very high wages, as well as offered a strong benefit package. The combination of all that ended the business.
Jevic was known for its innovations within the industry, as well as great customer service. It served in what is labeled the less-than-truckload market, delivering loads between 1,000 and 30,000 lbs. There was some overlap between the less-than-truckload and truckload markets.
The company added that there will be a small number of Jevic employees kept on during the closing down period.
Some of the innovations within the company made it one of the fastest-growing carriers in the 1990s. It just shows that innovation by itself isn't enough, you also have to have costs under control; especially worker costs which we do have some control over.
While it's great to be able to offer good wages and benefits to workers, it's not great when it becomes part of the downfall of a company. Would the workers at Jevic rather have their jobs with lower wages and less benefits, or be out of the work force? Would the company leaders rather have a successful company or close the doors?
There is a lot of pressure within the media to push executives to increase wages and benefits. We need to resist that when the consequences would be going out of business like Jevic.
What this tells me is they were at the top level of the wage and benefit food chain, and were living on the edge of any major problem putting extreme pressure on the business. The result of having to shut down the business speaks for itself on not being able or willing to manage costs properly.
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I guess opinions are like you-know-what - Let me just say that my husband has worked for the last twenty-five years
driving throughout the 48 states was in no ways 'over compensated' for his job. In fact a drivers day is about 14 hours of work - LTL deliveries - or less that truckload is very hard work, loading unloading, 10 stops or more a
day...how much would you pay?
You should look into the investment company, Sun Capital that purchased Jevic in 2006 and has been 'disassembling' the company ever since (ie selling the properties that the terminals were located on etc...) They are worth billions - they need a tax write-off --and they fact is that they could have given proper notice to the government (WARN act states 60 days) and not cut off health insurance the same day the closed the doors. I know I'm close to the situation and look at it emotionally - but this 'Sun
Capital' has done this before ------I see a law suit in their future, don't you?
Posted by: ellen collins | May 22, 2008 12:10 PM | Permalink to Comment