A North Carolina trucking company notified over 200 drivers, employees and mechanics on Tuesday it is ceasing operations after 11 years after some of its major customers demanded “massive rate and volume concessions.”
FreightWorks Transport LLC, doing business as FreightWorks Transportation & Logistics, headquartered in Rutherfordton, operated 186 power units with around 140 drivers, according to the Federal Motor Carrier Safety Administration’s SAFER website.
In a video message to employees and drivers, Joyce Siqueira, vice president of operations for FreightWorks, said the “most honorable path that we can take for the benefit of our employees, our customers and our other stakeholders is an orderly closing of the company.”
Siqueira said the company was unable to see a path forward after a few of its core contract customers abruptly demanded significant rate reductions, amounting to millions of dollars. The death knell occurred when one of FreightWorks’ largest contract customers “pulled a significant percentage of the company’s freight” on Feb. 28.
“This had an immediate and very devastating impact on our ability to make payroll, let alone cover our rent, truck payments and other expenses,” Siqueira said in the video reviewed by FreightWaves. “Several other events that same day compounded these already overwhelming challenges. In an incredibly weak freight market, we are simply unable to replace this lost freight with enough profitable work for us to be sustainable.”
The asset-based truckload carrier was founded with one truck in 2012 after production exceeded sales at the small family owned biodiesel plant, FuelWorks, founded by FreightWorks President and CEO Josh Farmer in North Carolina. The company was hauling mainly perishable items at the time of its closure.
The company had survived previous freight recessions because FreightWorks was largely insulated by its contract customers. Siqueira assured employees and drivers that concessions demanded by its customers “were solely due to market pressures” and had nothing to do with the truckload carrier’s execution and performance.
A former FreightWorks employee also shared the memo sent to employees and drivers — dated for “immediate release on March 10” — but it appears the truckload carrier was forced to cease operations earlier than expected.
Effective immediately, Siqueira said FreightWorks will no longer be picking up loads.
“This is very important to us to make sure that the millions of dollars of our customers’ freight that’s on the road right now, which is mostly perishable goods, is not ruined in the process of our shutting down,” she said.
No trucks will be stranded on road
The company will coordinate with drivers on how they should return equipment — either taking it to a designated drop yard or to their homes for now.
“We will make sure that everyone has the means to get home safe,” Siqueira said. “We are committed to ensuring that every driver is paid for the final delivery.”
Additionally, FreightWorks is asking for drivers’ help. The company will pay a $500 bonus for those who assist it in delivering their loads once the carrier has received a signed bill of lading.
“We didn’t run a trucking company just to move freight,” Siqueira said. “We ran a trucking company to take care of people.”