On Friday, Coyote Logistics, a wholly-owned subsidiary of UPS (NYSE: UPS) laid off all the carrier representatives in its Chattanooga office, leaving a small group of salespeople and administrative workers. Coyote had let the office shrink by attrition over the past year, not hiring replacements for brokers who left, but yesterday about 25 people in Chattanooga lost their jobs. Thirty IT workers were also cut from Coyote’s Chicago headquarters.
In one sense it’s the end of an era for freight brokerage in Chattanooga.
Coyote’s office in the city was based on its 2014 acquisition of Chattanooga’s Access America for approximately $260 million in stock and cash (the deal size was never officially disclosed). Access America was a fast-growing freight brokerage founded in Chattanooga in 2002 that eventually opened offices in Atlanta, Denver, Minneapolis, San Antonio, and other locations.
The layoffs at Coyote come at a time of widespread reductions in headcount across the transportation and logistics industry. The former Coyote brokers in Chattanooga will find jobs.
Other brokerages with offices in Chattanooga have reached out to FreightWaves to say they’re hiring, including Covenant Transport Solutions, the GuideOn Group, Trident Transport, and Arrive Logistics.
Over the years, many freight brokers and future entrepreneurs passed through Access and Coyote’s doors on Warehouse Row in Chattanooga, and a number of transportation and logistics companies in the city have roots in the company.
Ted Alling, Access America’s co-founder and former CEO, is a partner at the Lamp Post Group and Dynamo Ventures. Chad Eichelberger, who was the president of Access America when it sold, is now the president of Reliance Partners, a commercial vehicle insurance agency; his partner Ronald Ramsey, Reliance’s chief commercial officer, was executive vice president at Access and Coyote. Steve Cox, who was executive vice president at Access, is now the president and COO of Steam Logistics, a Chattanooga-based freight forwarder. Carter Garrett, who was a regional vice president at Access and then Coyote, is now the vice president of Trident Transport. Asa Shirley and Ryan Doherty, both sales managers at Access America and Coyote, are now senior vice presidents of sales at Arrive’s Chattanooga location. Keith Gray, vice president of operations at LYNC Logistics, was a national account manager at Access and then Coyote. The list goes on.
Even FreightWaves has benefited from the logistics culture established by Access America: our own ocean market expert, Henry Byers, honed his craft in truckload and less-than-truckload brokerage at Access and Coyote before getting into freight forwarding at Steam Logistics.
Access America and Coyote Logistics formed some important secondary building blocks of Chattanooga’s freight culture—family-owned businesses like U.S. Xpress (NYSE: USX), Covenant Transportation (NASDAQ: CVTI) and Kenco were the foundation.
In 2015, UPS acquired Coyote Logistics for $1.8 billion, about one times revenue. Since then, Coyote has doubled in size, with an estimated 2019 revenue of $4 billion.
In the past two years, UPS corporate management has made a series of changes to the brokerage, including reducing incentive-based compensation, removing carrier reps’ visibility into their margins per load, and aggressively enforcing non-compete clauses—even against non-revenue generating employees like carrier reps—in an attempt to reduce churn and control costs.
A Driver
Trucking companies eat sand last year, it’s turn tables this year.
Trucking is cyclic and nothing really new is happening as many state, they just don’t study the past. The tech is just a tool, no a game changer. At the end of the day it’s not rocket science, it’s simple: freight get’s loaded onto a truck and driven to the destination. No matter how much tech, the freight will not teleport, not drive itself (not soon) and brokers forget that when they get all excited how good their life is getting and forget that they are cutting themselves out. I really don’t see any brokers soon, very soon it will be just shipper and carrier, and that is thanks to technology, that will be faster than self driving trucks.
Art
Shippers do not want to work with small carriers, especially 1 truck owner ops.
There will always be a middleman (broker/uber/convoy/whoever) in that market until trucks drive themselves and only a couple well capitalized asset based companies are left.
Noble1 suggests SMART truck drivers should UNITE & collectively cut out the middlemen from picking truck driver pockets ! IMHO
That’s why if drivers were to UNITE they would have capacity , they would cut out the middlemen and be the carrier , the broker , the market by driving for their Alliance and nobody else . Furthermore , they would be among the one’s left and eventually transition into autonomous vehicles while still reaping from the industry without driving .
It’s getting late in the game . It still could be pulled off . However , I believe drivers are a little to primitive to pull it off . Most have been one step behind in this game otherwise they would have figured it out already . They’re fighting among themselves rather than realizing who actually caused them to fight and divide . They believe this is enacting their free will , LOL ! They blame the effect rather than the cause .
If shippers are smart they’ll replace the carriers with their own autonomous vehicles . That’s why I have been advocating once drivers unite too extend their Alliance towards labourers in other sectors and industries and obtain those businesses collectively as well . You need to anticipate and then position yourself ahead and create the chain reaction in your favor . They’d(bourgeoisie) fall like dominoes .
IMHO
A Driver
We are a 10 trucks company and we will be more soon, we grew last year 4 units. We don’t deal with brokers much, we go direct, as of 2019 we learned that going direct is BOLD and efficient!
Noble1 suggests SMART truck drivers should UNITE & collectively cut out the middlemen from picking truck driver pockets ! IMHO
I’ve been saying it all along . We re transitioning towards a new era . We transition from feudalism to capitalism , and now transitioning to socialism . Capitalism is dead .
Before some start ranting that I’ve lost my mind and this transitional inevitability , I must give credibility where it’s due . Marx predicted it , and I’m supporting it .
Quote :
Capitalism Is Dead,’ Says Billionaire Made Rich By Capitalism
Salesforce chairman and co-CEO Marc Benioff has a simple message for capitalists around the world: Capitalism is dead.
“As a capitalist, I believe it’s time to say out loud what we all know to be true: Capitalism as we know it, is dead,” the billionaire wrote in a recent column in the New York Times.
The piece plainly lays out the case for why capitalism’s “obsession [with] maximizing profits for shareholders” has failed us and led to “horrifying inequality” along with the threat of “catastrophic climate change.”
“It’s no wonder that support for capitalism has dropped, especially among young people,” Benioff wrote.
The core logic of capitalism is profits, which eventually means the exploitation of workers, consumers, the state, and anything else that might earn a profit. ”
End quote :
And now a little Marx :
I. Bourgeois and Proletarians
Quote :
” Society can no longer live under this bourgeoisie, in other words, its existence is no longer compatible with society.
The essential conditions for the existence and for the sway of the bourgeois class is the formation and augmentation of capital; the condition for capital is wage-labour. Wage-labour rests exclusively on competition between the labourers.
The advance of industry, whose involuntary promoter is the bourgeoisie, replaces the isolation of the labourers, due to competition, by the revolutionary combination, due to association.
The development of Modern Industry, therefore, cuts from under its feet the very foundation on which the bourgeoisie produces and appropriates products.
What the bourgeoisie therefore produces, above all, are its own grave-diggers. Its fall and the victory of the proletariat are equally inevitable. ”
End quote .
Capitalism has lead to it’s own demise . If I achieve my goal and truck drivers UNITE , it’ll be another major nail in the capitalist’s coffin . One so grave that it’ll go down in the history books for sure .
IMHO
Mike
I have attempted to use these clowns in the past, and I cannot believe that UPS has anything to do with this outfit. Hell, I’m surprised they are even in business. Call these guys sometime, and see what answers the phone. I had one kid, he sounded like he was stoned on dope while the rest of the crew was partying it up in the background. A totally unprofessional group of loser millennials. Good riddance. And the last outfit I would ever accept a load from, and yes, I am a carrier in good standing with them, but have never pulled any of their freight. See above.
Westside transport driver
Owner operators that don’t speak English use coyote logistics. I was at red gold tomato sauce in Indiana between fort Wayne and Indianapolis at a Petro truck stop exit then go west then they’re on the left a few Miles. And most people were their own trucking company not speaking English saying coyote logistics and a few words in English . other’s held their cell phones up to the check in window then read the translation of what shipping said on their cell phone screen . I guess the cell phone speaks English for them to the shipping window
Art
Illegal aliens are driving for all sort of carriers working for all sorts of brokers.
The cheapest truck gets the load. (maximum profit)
Thank government for loopholes allowing illegal aliens to work, and causing wage deflation.
Noble1 suggests SMART truck drivers should UNITE & collectively cut out the middlemen from picking truck driver pockets ! IMHO
Quote:
“The desire to depress wages and make people dependent is the same reason so many in government and business have had such a split reaction to unauthorized immigration. They pretend to oppose the movement of people into the U.S. for political reasons, but they want the labor forces who can’t afford to argue and who will work very hard for low rates of pay.”
Art
Democrats and republicans are both FAKE regarding tackling immigration.
“Build the wall” Trump says but government continues to allowing illegals to work (using fake SSNs, 1099 contractor, etc)
Obama deports “record numbers of illegals” but lets bring in record numbers who then will almost always overstay visas.
Both parties suck at controlling illegals that depress wages for those with legal status.
Trucking and construction is mostly illegals working for peanuts.
Office/knowledge jobs are not immune either.
Illegals will do any work and accept less, not pay much taxes. Driving pay down for folks with legal status AND TAX BILLS.
Stephen Webster
A lot of cheap trucks with cheap truck drivers hauling freight. I am unable to work do not miss it. Part of a group in Ontario Canada protesting against the insurance companies and poorly treated truck drivers and homeless people. 7168604681
ThaGearJammer25/8
People make tech. Tech is the new that washes out the old. We got Trump nothing to fear. Sociology has important teachings on this “everyone gets a medal” it isn’t about the medal… it is about developing skills.
Success is not the result of making money. Making money is the result of success. Success is service and money is a measure of that. We serve best by creating never competing. Therefore we receive what we give. As always your perception of others is a reflection of yourself. Damn hippie
Dave
Dude. Speak in normal words or get back to your community college sociology class.
The bottom line is slackers get cut and those making money succeed and continue to exist at the expense of the slackers. It’s called “capitalism”.
DT
This is typical today. People are getting replaced by tech – not helped by a soft market for freight and trucks. This will continue. Money losing offices are being cut. It’s everyone for themselves. No more free lunches and medals you millennials. It’s gonna be SLASH SLASH SLASH for ALL unless a company or office is making a PROFIT. Everyone needs to justify their existence in green hard cash.
Bill
Yes, how evil. A business is losing money at an office and they eliminate it.
CM Evans
What is this soft market you speak of ? Everyone needs to let go of the high they’re on from 2018, that was an anomoli. Be thankful things are humming along smooth and steady.
Art
Tech replacing millennial office workers.
Nobody is safe… blue collar, pink collar, white collar.
Keep using Amazon, Uber, Lyft, and Convoy… they will save your jobs…
Mike
LOL! Have you ever had any contact with this bunch? I would have sacked them all a long time ago and burned their offices to the ground and destroyed all records of affiliation if I were UPS. Coyote is group of millennial stoners, call them and see what answers the phone. And no, I was not burned by them, but the few contacts I have had, I would not haul their freight with your truck. They give our industry a bad name with their total lack of professionalism.
Elvis Durant
This is only a glimpse of how the remainder of 2020 gonna go in Trucking. Fasten your chops folks!
Bill
Warehouse Row is prime Chattanooga real estate. Wonder is another logistic company will swoop in with hopes of getting some of the Access/Coyote mojo.