The president of the Teamsters local in North Little Rock says he will meet with Gov. Mike Beebe next week as the union tries to keep ABF Freight Systems from moving its distribution center — and most of its 300-plus jobs — to Memphis.
"It really was a surprise," Tim Nichols said Friday. "Arkansas Best Freight is the flagship operation. It really is a shock. We never expected to lose virtually an entire operation."
ABF Freight, a subsidiary of ArcBest of Fort Smith, has been offered a $4 million incentive by the Economic Development Growth Engine of Memphis & Shelby County. EDGE said ABF was interested in a $20.5 million terminal expansion in Memphis that would create 283 new jobs.
ABF Freight already has a terminal on Dunn Avenue in Memphis. EDGE officials said the expansion would include the purchase of adjacent areas and expanding the terminal from 42,000 SF to 138,000 SF.
"ABF already has a significant footprint in Memphis and Shelby County," Trey Heath, EDGE’s director of marketing and communications, said in an email message. "This is an industry we are focused on and the jobs ABF committed to providing are great-paying jobs for our community.
"We are pleased they are considering this community for their new investment."
An ABF spokesman said no decision has been made in regards to a potential move, but Nichols said the company has told the union that a move was in the works.
"What they discussed with us was they intended to move," said Nichols, president of Teamsters Local 878. "The North Little Rock facility and Local 878 are synonymous. It’s going to have a hell of an impact on a lot of folks."
ArcBest closed or consolidated eight terminals in 2013 and 22 more in the first quarter of 2014.
"What is currently being evaluated is whether or not ABF Freight will relocate part of its operations and support functions from North Little Rock to the greater Memphis area," said Russ Aikman, director of marketing and public relations. "A variety of factors are being considered. "The greater Memphis area has long been a hub for transportation and shipping companies, including many of our competitors.
"If Memphis is expanded, we would continue to have a service center servicing customers in the Little Rock area. However, because a final decision has not been made, we cannot share details on any specific moving plans or expected costs at this point."
Nichols said approximately 380 union members work at the North Little Rock facility as hourly or salaried employees with average annual compensation of $73,000. He said ABF Freight told the union that employees would be given the opportunity to move to the new facility, whether it is in Memphis or elsewhere.
"The number of employees is subject to change at this point," Nichols said. "The indications are we will retain 25-40 jobs in North Little Rock."
Nichols said his members are "scared and upset" about the possible loss of hub operations.
Nichols acknowledged that there is not much the union can do to prevent the move either on the local or international level. While the incentive offered could be attractive, Nichols said the move would be primarily logistical in order to get ABF Freight a bigger presence in Memphis and its proximity to interstates, railroads and the Mississippi River.
Nichols said he has also reached out to North Little Rock Mayor Joe Smith and will discuss with the governor the idea of coming up with an incentive plan to entice ABF Freight to stay.
"We have a very slim chance," Nichols said. "All we can do is try to level the tax situation for the company so we’re even with Shelby County."