AM I NEXT? NO LOVE AT DOLE FOODS COMPANY (UPDATED)

UPDATE: SEPTEMBER 20, 2018 DOLE HQ BUILDING SOLD; IN JULY 2018 - 49% OF THE EQUITY IN DOLE WAS SOLD TO A FOREIGN PRODUCE PRODUCER

Dole’s 168,000-square-square foot Westlake Village, California building has been sold to the Conrad Hilton Foundation for $50 million. Dole will lease a portion of the building for its downsized operations.

It is no secret that Dole has been suffering from lagging sales and mounting debt service.

In July, Dole’s owner David Murdock sold 49% of the equity in the company to Dublin. Ireland-based Total Produce, a leading provider of produce to Europe.

UPDATE: The bad news continues for employees at Dole 

Dole has announced another round of layoffs, this time 402 workers as part of a move out of producing strawberries in California. Another layoff will affect more than 268 workers in addition to those mentioned below.

According to a Los Angeles Times article, Dole is “struggling with nearly $1.3 billion in debt, low operating margins and declining revenue.” The company is hoping for a public offering to infuse capital into the company. This initial public offering would be the third time that the public has gone public.

There is renewed talk about moving corporate out of their Westlake Village headquarters to an out-of-state location, possibly Kannapolis, North Carolina where Murdock maintains a residence and is the location of his personally-endowed research institute. 

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Original Post ... 

It appears that Dole Food, the world's largest producer and marketer of high-quality fresh fruit and fresh vegetables, is in the middle of another financial maneuver under the shrewd direction of billionaire David Murdoch.

As part of spinning off a portion of Dole operations to the public, Dole has announced that it will be laying off 172 workers and closing their subsidiaries Dole Berry, DB South, and Dole Fresh Vegetables in Ventura County, California. The impact will be much larger on the local community as Dole will not be hiring the customary temporary farm workers for the picking season.

It has been suggested that Dole is looking to leave farming in Southern California and will possibly be laying off as many as 600 workers in total. 

Notorious tight-lipped about their operations, it appears that Dole has told the Securities and Exchange Commission that they had signed a term sheet to sell their Westlake Village headquarters in a tax-free exchange with one of their affiliates, Castle & Cook Properties.

Since Murdoch has significant real estate holdings in the area, especially his residence at Ventura Farms, it is unlikely that the 94-year-old Murdoch will be leaving the area. Murdoch, a vegetarian, said he plans to live to 125 years-old and considering the amount of money he has invested in the California Health and Longevity Institute located next to his headquarters in Westlake Village, it might even be believable. 

An interesting look at Murdock, his life, and his ideas for better health ... 

CAPITALISM UNDER ATTACK

Capitalism, the economic system that has improved the lives of so many people around the world is under attack from the international socialists who believe that government should be the arbiter of most everything in the world.

Professor Philip Alston, the United Nations’ Special Rapporteur on extreme poverty and human rights, has presented his report to the United Nations’ Human Rights Council. A curious organization as its membership is comprised of some of the worst violators of human rights in modern history. 

“The fundamental values of the international human rights system are under attack in new and diverse ways in 2017. While competing explanations have been proffered, one that is included in most lists is that there is a rapidly growing sense of economic insecurity afflicting large segments of many societies. There is an increasing feeling of being exposed, vulnerable, overwhelmed and helpless, and of being systematically marginalized, both economically and socially." 

"This situation, which previously seemed to be a fate reserved only for those living in low-income countries or in extreme poverty in high- and middle-income countries, now afflicts not just the unemployed and the underemployed, but also the precariously employed and those likely to be rendered unemployed in the foreseeable future as a result of various developments.”

“The present report is premised on the view that the human rights movement needs to address and respond to the fundamental changes that are taking place in economic and social structures at the national and global levels. These include, among others:

• The increasingly precarious nature of employment in the age of Uber, Airbnb, outsourcing, subcontracting, zero-hours contracts and the like;
• The fact that traditional forms of labour market regulation are becoming ever less relevant to the emerging economy, and that an insistence on their continuing normative validity, however strongly justified, is increasingly impotent in the face of the evolution of global supply chains and other developments based on worker insecurity;
• The likelihood that vast swathes of the existing workforce will be made redundant by increasing automation and robotization, accompanied by the ever-greater concentration of wealth in the hands of the technology elites and the owners of capital;
• The rapid and seemingly unstoppable growth in inequality across the globe, captured by Oxfam’s statistic that the richest 1 per cent of humanity already controls as much wealth as the remaining 99 per cent,5 and by the detailed national-level economic analyses of Thomas Piketty and others; and 
• The ascent of a new neoliberal agenda, which involves further fetishization of low tax rates, demonization of the administrative State, deregulation as a matter of principle, and the privatization of remaining State responsibilities in the social sector, risks leaving the State in no position to protect or promote social rights meaningfully.

"The principal purpose of the report is to reflect on the desirability of advocating a basic income approach to social protection when viewed from the perspective of international human rights law. Basic income offers a bold and imaginative solution to pressing problems that are about to become far more intractable as a result of the directions in which the global economy appears inexorably to be heading. While there are many objections, relating to affordability in particular, the concept should not be rejected out of hand on the grounds that it is utopian. In today’s world of severe economic insecurity, creativity in social policy is necessary."

Of course, implicit in the Professor's suggestions is that: one, government is needed to regulate all economic activity; two, governments must generate sufficient tax revenues to engage in wealth redistribution, three, a certain amount of nationalization of heretofore private property will be necessary, and four, this basic income will resolve many of the insecurities being suffered by third-world economies and people made redundant by automation and robotics. Of course, it also suggests that one would need to provide universal healthcare, affordable housing, and that it would all have to be managed for the benefit of the people by a cadre of “experts.”

If this sounds familiar, it is because it looks suspiciously like the class warfare advocated by international socialism and communism. Economic systems which have been proven unworkable and unsustainable in the real world. Or as England’s former Prime Minister, Margaret Thatcher, observed, “the problem with socialism is that you eventually run out of other people's money.” 

Be very careful of the political policies you advocate because some of them lead to a downward spiral into a state of totalitarianism much like modern-day Russia, Cuba, Venezuela, and North Korea --  Where producers must be forced, often under the threat of prison or even worse, to continue producing in order to provide sustenance for non-producers. Of course, when central planning fails, and people grow angry over shortages, even more force must be applied.

I was amused to see that one of the proponents of the basic income approach was Elon Musk whose various enterprises could not exist without government subsidies, contracts, and mandates. And whose only profit was turned on the sale of government-mandated pollution credits.

The full report is available on the Commission's site.

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NO LOVE AT UNION PACIFIC RAILROAD (02/26/23)

FEBRUARY 26, 2023 — MANAGEMENT CHANGE, PERSONNEL DISRUPTIONS COMING

Activist investor, New York, NewYork-based hedge fund Soroban Capital Partners, has demanded the replacement of CEO Lance Fritz in 2023.

“As you are aware, we have been consistent in privately expressing to you and other Board members our displeasure with years of persistent operating underperformance at UNP and our long-held view that current management is not capable of driving strong operating performance. This most recently includes our August 2022 Board-level discussion where we highlighted the gravity of today’s challenges. Regrettably, acute operating issues at UNP have continued, and we see a heightened risk of permanent damage to the franchise if left unaddressed. While it is highly atypical for Soroban to publicly disclose our communication with a board of directors, given the Board’s prolonged inaction despite years of underperformance, we feel it is critical for the Company’s future that we highlight the need for Mr. Fritz to be replaced with best-in-class leadership.”

When management changes, look for reorganization and personnel changes.

JUNE 21, 2021 — PALESTINE, TEXAS LAYOFFS DELAYED BY COURT BATTLE.

“An ongoing legal battle has delayed plans to lay off 57 workers at Union Pacific’s Palestine railcar shop. At issue is a 1954 contract between the railroad AND THE MUNICIPALITY.

APRIL 18, 2021 — CLOSURE OF MAIN RAILCAR REPAIR FACILITY IN PALESTINE, TEXAS WITH 57 LAYOFFS

Union Pacific’s Palestine, Texas railcar repair facility will close June 14, 2021, with 57 layoffs.

According to a company spokesperson, “While Union Pacific is closing our main car repair facility in Palestine, limited car repair activities will continue in the Palestine area. We did not take today’s step lightly but we are determined to do the right thing for thousands of customers, employees, and communities who rely on us to help build sustainable economic growth across the western two-thirds of the United States. We appreciate the support we have received over the years in the communities of Palestine and Anderson County, as well as the hard work and dedication of our employees. We are working with those impacted to help them with job placement activities.”

SEPTEMBER 5, 2020 — MORE LAYOFFS COMING

Although the company declines to state how many salaried and union jobs are on the chopping block, it did confirm that there will be a significant number of layoffs.

According to a company spokesperson, “These are difficult decisions; however, we remain committed to providing our customers safe, efficient, and reliable service that ensures Union Pacific remains a strong and competitive company."

APRIL 23, 2020 — NEW COST-CUTTING MEASURES INCLUDE EXECUTIVE PAY CUTS AND FORCED UNPAID LEAVE

Citing an “unprecedented drop” in freight traffic, Union Pacific President and CEO Lance Fritz announced “Many of our customers have reduced or halted production and overall freight transportation has declined dramatically.

Union Pacific has enacted several cost-saving measures, but they are not sufficient to offset the significant decline in volume.

Accordingly, the railroad also is implementing changes that will impact our workforce.

Every non-union UP employee will take one week of unpaid leave in May, June, July and August. Executives and board members will see a 25% reduction in pay over that same time period.

I considered many possible scenarios, including furloughs or permanent workforce reductions,but the leaves and pay cuts meet UP’s short-term needs. UP has canceled its 2020 summer internship program, reduced or eliminated non-agreement hiring, and eliminated nonessential spending through the end of 2020.”

OCTOBER 17, 2019 — SHUTTING DOWN OPERATIONS AT THE NEFF RAIL YARD.

The company has announced that it will be transferring switching operations from its Neff Rail Yard in Kansas City, Missouri to a rail yard in Kansas City, Kansas a distance of 17 miles. The number of layoffs is uncertain at this time due to the proximity of the two locations but is estimated as being up to 200 employees.

A company spokesperson noted that this is another facet of the company’s unified plan to streamline operations as part of its Unified Plan 2020 which will improve service reliability for customers, increase operating efficiency and reduce network complexity.

UPDATE - MAY 22, 2019 — OREGON LAYOFFS

UP has announced that they will be laying off 195 employees at the Hinkle Rail Yard, Supply Warehouse, and Mechanical Locomotive Shop in Hermiston, Oregon. The layoffs include machinists, electricians, switchmen, material handlers, and general laborers.

The rail yard will be permanently closed and The locomotive repair shop and Supply Warehouse will remain open.

The layoffs are part of the "continuous improvement plan" known as “Unified Plan 2020, which streamlines operations as we ensure Union Pacific remains a strong and competitive company."

UPDATE: NOVEMBER, 26, 2018 - ADDITIONAL LAYOFFS ANNOUNCED

In addition to the previously announced layoffs, UP will be laying off an additional 60 employees, mostly in the Little Rock, Arkansas area.

According to a company spokesperson, “The workforce reduction is an effort to reduce our general and administrative support structure as we continue implementing our new operating plan, Unified Plan 2020, which ensures Union Pacific remains a strong, competitive, and vibrant company.

UPDATE: OCTOBER 25, 2018 UNION PACIFIC ANNOUNCES ADDITIONAL LAYOFFS - 675 POSITIONS TO BE ELIMINATED

Union Pacific has announced prior to the release of its 3rd Quarter results that it will be laying off approximately 475 employees and 200 contracted positions as the first of additional rounds of job cuts as it implements a new operating plan to reduce or eliminate many of the service and congestion issues that are currently plaguing the company.

Chairman and CEO Lance Fritz noted that “these steps are part of reducing our general and administrative support structure by roughly 30% by 2020.”

Other efforts which may portend a reduction in force include: consolidating operations from three regions — north, south, and west — to two: north and south; eliminating five service units: Denver, Livonia, St. Louis, Sunset, and Twin Cities; and transferring customer service from the Marketing & Sales to Operations.

Original post

Like many other large industrial corporations, Union Pacific has announced that it will be reducing its workforce by approximately 700 employees, mostly at its Omaha, Nebraska headquarters. It is anticipated that the cuts will impact 500 management and administrative positions and about 250 hourly positions by mid-September (2017). 

Union Pacific, a Fortune-500 company, and the nation’s second-largest freight line is profitable but sees that cost-cutting improvements can be made. The key metric driving the cuts is the “operating ratio” which is a railroad’s proxy for profitability. The ratio consists of expressing operating expenses as a percentage of revenue. The company is prepared to spend approximately $90 million, including $15 million for severance pay plus pension benefits and other expenses, to reduce their operating ratio from last quarter’s 61.8 percent to a more desirable 55.5%. The company plans to offer early retirement and buyout plans for employees meeting certain criteria. This should ease the financial and emotional stress on some employees. 

Union Pacific is looking at the benefits of running longer trains and more automated systems that replace personnel. One significant adverse impact on the industry came from former President Barack Obama’s climate initiatives and his attack on coal mining and coal-fired power generation plants. The last two years have been rough for the industry. Competitor, CSX announced that it had trimmed its workforce by approximately 2,300 hundred positions and 900 locomotives. 

However, an opportunity is where you find it because several realtors in Omaha appear to be looking for relocation sales into a tight and rising housing market. 

Change is coming. There will always be a tomorrow, no matter how much you may try to ignore it. There are no guarantees in life or promises for a bright future. Just because something bad hasn't happened yet, doesn't mean it won't. It can happen to anyone, anytime, anywhere. No one is guaranteed to wake up tomorrow and still have a job by evening. Are you now wondering, Am I Next?

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