Texas Carrier With 260 Drivers and Owner Operators Shuts Down
Diboll, TX – A year defined by a devastating number of trucking company closures will end with Fleetwood Transportation Services shutting down on New Year’s Eve after more than 60 years in business.
Rumblings of the Texas-based trucking company’s imminent demise began earlier this month.
Transportation Nation Network (TNN) reached out to executives within the company, but they declined to speak with us.
However, TNN obtained a letter sent by Peter Lynch, Chairman of the Board of Directors of the Fleetwood Companies, to its contractors and owner operators dated December 17, 2019, notifying of the company’s closure.
“We regret to inform you that Fleetwood Companies will be ceasing operations as of December 31, 2019 at 11:59 p.m.,” Lynch writes.
Further, Lynch explained, “We would have liked to have given you and your employees more notice however it has not been until recently that Fleetwood Transportation Services has been able to renew its insurance. At that time, the premiums for insurance became unaffordable and the decision was made within the last week to cease operations as of December 31, 2019.”
Lynch asked drivers to continue to haul their scheduled loads and promised they would be paid.
What Led To Fleetwood’s Failure?
A Fleetwood insider with direct knowledge of the company’s struggles, who spoke with TNN on the condition of anonymity, confirmed, “Insurance was a major part of it.”
Fleetwood’s insurance carrier of 20 years increased premiums by 40% last year, and then dropped the company completely in November after a fatality accident, the insider explained.
“Fleetwood had a bad fatality accident early this year in Center, TX with a driver that was under the influence that killed a woman and disabled her teenage son,” the source told TNN.
Further, the insider indicated the company only received one other quote from an insurance carrier but it was four times the current premium.
Another significant blow came in September of this year when the insider says Georgia Pacific pulled their business due to “management changes” and perceived “instability” within Fleetwood.
Georgia Pacific accounted for a huge piece of their overall revenue at 30%, the source revealed.
Fleetwood company leadership was then faced with the real prospect the carrier might be forced to close.
“They were hemorrhaging money after that and decided it was best to close while they could still meet all their financial commitments as opposed to leaving people unpaid and filing for bankruptcy,” the Fleetwood insider told TNN.
RECENT TRUCKING CLOSURE NEWS
More About Fleetwood
According to its website, Fleetwood was founded in 1956 to provide transportation services to lumber mills.
“What started with a couple of trucks running regional services has developed into multiple transportation services provided to our growing customer base with a national footprint,” its website, which is still online as of this publishing, states.
According to data from the Federal Motor Carrier Safety Administration (FMCSA), Fleetwood operates 102 power units with 102 drivers.
The Fleetwood insider tells TNN the carrier also had 160 owner operators at the time of the company’s closing.
In the past 24 months Fleetwood reported two fatal accidents.
The company’s vehicle inspection out-of-service rate also checked in at 26.6% which is above the national average of 20.72%.
Fleetwood operated an energy division, providing the delivery of sand material using pneumatic and hopper bottom trailers for the oil and energy industry.
It’s flatbed division serviced customers throughout the United States, Canada and Mexico, hauling steel, machinery, heavy equipment, wood products, oilfield commodities, and legal and over dimensional loads.
It’s dry van division delivered throughout the Mid-Atlantic, Midwest, Southeast and Southwest, according to its website.
However, the “core customers” of its business were in Fleetwood’s Forest Products division.
The company says it had more than 30 operations at customers’ mill and production facilities.
Those operations provided total production services with chip trailers, soft and curtain side flatbeds, and live bottom trailers.
This is a developing story, so stay logged on to TransportationNation.com for the latest.
WANT MORE? GET MORE!