Rumors started swirling on Friday that a Waco, Texas-based less-than-truckload carrier was shutting down its western division.
Central Freight Lines (CFL) President Michael Brennan was quick to respond that the rumors are “100 percent untrue.”
“We are fully operational in our western division that contains nine facilities,” Brennan told FreightWaves. “I have no plans of reducing or shutting those facilities down.”
He admitted he received multiple calls on Friday from numerous third-party logistics companies and direct LTL competitors inquiring if the rumors were true — with offers to hire CFL employees.
Brennan said one source told him a former CFL employee who went to work for a direct competitor originated the rumors that the 95-year-old LTL carrier was eliminating its western operations.
Recently, Brennan said the company had taken a different stance on its policy regarding volume loads as shippers struggled to find truckload carriers to haul their freight.
According to Brennan, the policy switch was necessary because as intermodal and full truckload markets tightened, CFL was receiving requests from shippers to move full truckloads.
“We were getting inundated with truckload volume, shippers hitting us with 20 to 30 pallets for a single pickup,” he said. “We have reduced that because we are a less-than-truckload company.
“We have to make sure we don’t lock our system up with truckload and that we keep our less-than-truckload customers happy because that’s our business,” Brennan added.
$76 million expansion in the western market
The LTL carrier, owned by Jerry Moyes, former owner of Swift Transportation, recently invested around $76 million in brand-new facilities in the carrier’s western division, according to Brennan.
“There’s no way Moyes would have invested this much of his own money if he had any other plans except to grow the western market and take on market share,” he said.
This week, CFL had all of its national account directors at the carrier’s headquarters in Waco to go over its 2021 budget and market strategy.
“At no point during our conversations did we ever discuss closing the West,” Brennan said. “We talked about taking on market share and looking at buying a company in northern California where we’re not at today.”
CFL wins lawsuit against Amazon
The Texas LTL carrier scored a legal victory against Amazon in late October 2019 after a jury awarded it $2.4 million against the e-commerce giant.
According to a FreightWaves report, CFL first began hauling less-than-truckload (LTL) freight for Amazon in 2011. But its relationship with Amazon started going south by 2016 as the e-commerce powerhouse “attempted to wield its economic power to force through billing and procedure changes that Central Freight never agreed to,” according to the carrier’s complaint.
CFL has 1,651 power units and 1,175 drivers, according to the Federal Motor Carrier Safety Administration SAFER website. Over the past 24 months, CFL trucks were inspected 1,339 times and 270 trucks were placed out of service, resulting in a 20.2% out-of-service rate, which is lower than the industry’s national average of around 20.65%, according to FMCSA data.
CFL drivers were inspected 1,608 times and 31 were placed out of service in the same two-year period, resulting in a 1.9% out-of-service rate, below the national average of around 5.1%. The company has been involved in three fatal crashes, 40 injury crashes and 55 towaways over the past 24 months.
The company was founded by W.W. “Woody” Callan Sr. in 1925.
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