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Closures and layoffs continue to vex the trucking industry in 2019, but three recent downsizings were attributed by the companies involved more to the vicissitudes of the energy, retail and final-mile industries than to a slowdown in the overall freight market.
Stevens Transport of Dallas notified employees on Sept. 25 that it is shuttering its tanker division due to weakened demand from hydraulic fracturing, or fracking, activity in the Southwest. The carrier will lay off 586 employees as a result, according to records filed with the Texas Workforce Commission. The company said in a letter that it would cease all tanker business on Oct. 15.
Clay Aaron, president of Stevens Transport, confirmed the closure in an email to Transport Topics.
“The decision to close Stevens Tanker Division came only after a careful analysis of the volatility in the oil and gas sector combined with the near-and-long-term forecasts regarding return on invested capital,” Aaron said. “We believe this course of action allows us to focus on our legacy refrigerated service business in the truckload, intermodal, dedicated, regional and logistics segments.”
Stevens established its tanker division in 2011 to serve oil and gas drilling operations in Texas, New Mexico, Oklahoma and Louisiana.
Despite the closure, the company has been adding new equipment. Earlier this year, Stevens Transport ordered 1,600 new tractors and trailers for 2019 at a cost of $165 million, according to a statement released by the company Jan. 29. More specifically, the company added 950 tractors and 650 trailers to replace about 25% of its current fleet. Included in that order, however, were 200 pneumatic trailers for the tanker division.
Stevens Transport ranks No. 51 on the Transport Topics Top 100 list of largest for-hire carriers in North America and No. 5 on the TT list of largest for-hire carriers in the refrigerated sector.
While the fracking sector may be on the decline, e-commerce is, by all accounts, booming. However, three companies that recently lost business with one of that sector’s top companies — Seattle-based Amazon.com Inc. — are now cutting staff as a result.
(Gabby Jones/Bloomberg News)
Amazon’s termination of contracts with Inpax Final Mile Delivery of Atlanta, Sheard-Loman Transport of Chicago, and Letter Ride of San Diego, will result in a total of about 1,800 layoffs.
An Amazon spokesperson confirmed to TT that it canceled contracts with the carriers, but declined to cite its reasons. The company did say, however, that it reviews contracts from time to time regarding customer satisfaction and safety records.
Inpax will lay off a total of 718 employees, according to recent notices filed with the state governments of Texas, Ohio, North Carolina and Georgia. The breakdown is 228 in Dallas; 128 in Ohio; 200 in North Carolina; and 162 in Georgia. Such notices are required because of the Worker Adjustment and Retraining Notification Act of 1988.
Inpax officials did not return a message from TT.
Sheard-Loman and Letter Ride reported that the loss of their Amazon business would mean cuts of 200 and 900 jobs, respectively, according to court documents and WARN filings.
Sheard-Loman could not be reached for comment. Letter Ride did not return messages left by TT.
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