VANCOUVER, Wash. (Sept. 13, 2002) — The Labor Day shutdown of Consolidated Freightways Corp., which had up to 30,000 trucks and trailers on the road, apparently will have little impact on the tire industry over the long haul, according to several industry observers.
Though the Vancouver-based shipper, which plans to file for Chapter 11 bankruptcy protection, was the third-largest less-than-truckload carrier in the country, the cargo it hauled still will be shipped, only by someone else.
“The shutdown is rare given its size, but thousands of fleets have closed in the last two years due to slowed freight, expensive fuel and other factors,” said Max Heine, editorial director for Overdrive, Truckers News and eTrucker.com. “The top two LTL carriers, Yellow and Roadway, will get some of their business, as will smaller competitors.”
Marvin Bozarth, senior technical consultant for the Tire Industry Association, agreed and suggested the closing might benefit other trucking firms. As for the tire industry, the actual consequence of the shutdown may be felt more along the lines of unpaid claims.
“On the day they announced (the shutdown) a lot of the trucking companies' stocks went up,” Mr. Bozarth said. “I don't know that it's going to mean a lot to retreaders or people who supply the tires. I don't know if they owed a lot of money to retreaders or not. Sometimes people have enough…holdings that they can pay off their bills.”
A spokesman for Bandag Inc., which supplied CF with retreads, said the company could not speculate on what the shutdown might mean but added “we weren't totally surprised.”
As for new tires, the trucking company bought about 20,000 tires annually, a CF spokesman said.
Bridgestone/Firestone, which supplied new tires to CF would not comment on the amount of business the two companies did together, calling the information proprietary.
“While the events are still unfolding, we continue to evaluate their filing of bankruptcy, and therefore it is premature to speculate on the affects of this to Bridgestone/Firestone,” said Singh Alhuwalia, BFS' vice president, U.S. commercial tire sales.”