Major shipping company that hauls for US Postal Service abruptly shuts down
A transportation and logistics company that had a contract with the United States Postal Service (USPS) has suddenly closed.
Midwest Transport, headquartered in Robinson, Illinois, has notified more than 650 employees, including more than 480 drivers, that it is ceasing operations,
Former drivers told industry website FreightWaves that they received calls from regional managers late Thursday night with the grim news.
They were then told that all USPS-related travel would be completed by Sunday.
MTI, which was founded in 1980, operated major terminals in Illinois, Pennsylvania, Tennessee and Florida, its website said.
Midwest Transport, which had a contract with the U.S. Postal Service, has abruptly closed its doors
According to data from the Federal Motor Carrier Safety Administration (FMCSA), the company employed more than 480 drivers and 428 trucks.
An MTI driver who spoke to FreightWaves said the news came out of the blue.
“I don’t know what happened because we had a lot of postal contracts all over the US,” he told FreightWaves on Friday.
‘I [don’t know if] the USPS is finding out just like we are [that] ‘The mail will be on the quay on Monday.’
Transport companies are the latest to run into financial trouble, after a series of bankruptcies and closures at shops and restaurants.
In June, US Logistics Solutions suddenly closed, affecting more than 1,200 employees. The company had been acquired by private equity just three years earlier.
About 500 of them were truck drivers and the rest were a mix of warehouse, port and office workers at the Humble, Texas-based company.
Some employees said the loss of major contracts, including a $30 million contract with Bath and Body Works and a contract with Barnes & Noble, left the company struggling.
The 30-year-old company confirmed On June 24, the company filed for Chapter 7 bankruptcy, meaning that the company does not plan to continue and will sell all of its assets.
The company was acquired by the private equity firm Ten Oaks Group, based in Charlotte, North Carolina.
Ten Oaks Group struggled to obtain further financing from its lenders, leading to the abrupt closure of USLS.
Before ceasing operations, USLS operated 19 terminals, primarily on the eastern side of the country.
America has been hit by a wave of bankruptcy filings in recent months, especially among small and medium-sized companies.
Chapter 7 bankruptcy is more serious than Chapter 11, and means that a company does not intend to continue and is selling all of its assets. Chapter 11 is considered a reorganization bankruptcy.
USLS operated 19 terminals before filing for bankruptcy on Friday
About 2,000 employees of US Logistics Solutions in Humble, Texas have lost their jobs
The most recent bankruptcy filing came Monday morning, when discounter Big Lots filed for bankruptcy, raising questions about the future of its 1,400 stores.
Big Lots bosses hope to sell the business to private equity firm Nexus Capital after closing more stores to cut costs and reduce its massive debt load.
But this year, several other retailers seeking to restructure have had to close their doors entirely and sell off their inventory. These include dollar store 99 Cents Only, DIY chain LL Flooring and furniture store Conn’s.
A total of 21 retailers and restaurant chains filed for bankruptcy in the first half of this year, the highest number since the pandemic devastated major companies in 2020, S&P said in a July report.
One of the most notable bankruptcies this summer was that of Red Lobster.