Kraft to eliminate private fleet
NEW ULM – Kraft Foods announced on Friday it is eliminating its private trucking fleet, and will be using contract carriers and commercial carriers to handle its transportation needs.
The private fleet transports products and materials across Kraft’s network of plants and distribution centers, and the company plans to begin using larger contract carriers to do this job.
The Kraft fleet employs 40 drivers and a few support people in New Ulm, said Joyce Hodel, a company spokesperson. Theirs will be among the 285 jobs in ten sites across the country that will be affected.
Hodel said the switch to contract carriers is being done in phases. The cuts will hit New Ulm in early August, she said. The change will be completed nationwide by the end of the year.
Kraft had a meeting with fleet employees on Thursday, informing them of the decision and of the severance benefits.
Hodel said severance benefits will include severance pay based on years of service, subsidies for health insurance-COBRA benefits during the severance period, and outplacement assistance.
Hodel said that includes assisting fleet workers with applications to work in the Kraft plant in New Ulm, if they wish. The Kraft fleet operation is separate from the Kraft plant production operations.
Hodel said the transportation work will be going to carriers with whom Kraft has had a “strategic partnership” in the past. She could not say if that would include any local carriers such as J&R Schugel Trucking or D&A Truck Line in New Ulm.
Hodel said the move is being made as part of Kraft’s focus on broadening its supplier integration, and using the larger scale and capabilities of its carriers.
“This is not a reflection on the work of our fleet,” said Hodel. “They have provided outstanding service to the company and our customers.”