This story appears in the Dec. 5 print edition of Transport Topics.
The owner of Lakeville Motor Express, a company that in recent years has operated as a cartage agent for Minnesota-based regional less-than-truckload carrier LME Inc., said he has shut down the business due to “heavy financial losses” and operational difficulties, including “the inability to hire drivers.”
“Lakeville is out of cash and has no reserves to pay any amounts owed to employees or vendors at this time,” Kevin Deming wrote in a letter to Bill Wedebrand, secretary-treasurer of Team- sters Local Union No. 120 in Minneapolis-St. Paul.
JULY 12, 2019 UPDATE: LME also shut down
The move drew a heated response from union officials who accused the owner of siphoning off freight to Finish Line Express, a carrier started by former Lake-ville Motor Express executive Travis Hoeschen earlier this year. Officials also criticized Deming for giving no notice of a pending shutdown to employees during the week before Thanksgiving.
Local 120 President Tom Erickson
said the union is considering a legal challenge.
“If what they did isn’t illegal, it should be,” Erickson said. “This is not right, not moral and not Minnesotan. These executives should be ashamed of themselves.”
The union represents 95 drivers and dockworkers, most of whom worked at the Lakeville Motor Express terminal in Rose- ville, Minnesota.
Lakeville Motor Express was founded in 1921 by Vincent Wren and run for years by members of the Wren family. Wren’s son John took control of the business in 1979 and later bought out the interests of his two younger brothers to become sole owner. John Wren then sold the business in December 2009.
New owners Roger Wilsey, a former Lakeville Motor Express vice president, and his wife, Shari, have since restructured the business to separate the nonunion regional freight operations from the unionized business. The freight business now operates under the name LME Inc., and Lakeville Motor Express operates as a local cartage agent in the Twin Cities under separate ownership.
“It’s a sad situation,” Wren told Transport Topics last week when asked about the demise of Lakeville Motor Express.
Wren served as chairman of American Trucking Associations in 1998-1999 and was widely admired for his ability to foster good relations with employees and the Teamsters union.
In a profile published by Transport Topics in 1998, company officials said Wren treated employees as an ex- tended family. “A lot of our people come to work here because of referrals by friends and family members,” said Wren’s son Joseph, who joined the company in 1992 and served as vice president of administration.
Thomas Hughes, an industry veteran who joined Lakeville in 1988 as president and chief operating officer, said the company paid $600,000 in shared profits to its unionized employees in 1997.
In his letter to the union Nov. 19, Deming said he has been president and sole owner of Lakeville Motor Express since August 2015.
“I have managed this operation over these past many months based on a business model that I hoped would be successful,” Deming wrote in the letter to the union. “Unfortunately, the inability to hire drivers and handle business levels as required has been quite challenging.”
Due to heavy financial losses, Deming said that he decided that Lakeville Motor Express “shall permanently cease all operations, close its business office and terminate all employees.”
A spokesman for LME, based in New Brighton, Minnesota, told Transport Topics last week that the shutdown of Lakeville Motor Express would have no effect on its freight operations. The company provides coverage in 10 states in the Upper Midwest and operates a fleet of more than 300 tractors and 1,100 trailers.
LME is part of The Reliance Network, a group of regional LTL carriers that exchanges freight with each other to provide national coverage. Other carriers in the network include Pitt Ohio, Averitt Express, Canadian Freightways and Kingsway, Mountain Valley Express and Peninsula Truck Lines.