Two days after HVH Transportation’s abrupt shutdown on Tuesday, August 27, 150 truck drivers, including James Delva, are still stranded across the country without working fuel cards.
Delva told FreightWaves early Thursday, August 29, that he was currently under a load and stranded in Phoenix, Ariz., More than 1,800 miles from his home in Lawrenceville, Georgia. He said his sister bought a bus ticket so he could go home.
“It’s neither fair nor fair for self-dedicated drivers and practically living on the road in their trucks,” Delva told FreightWaves. “I do my job, I drive safely and carefully, but I don’t get paid for my time and hard work. “
HVH, which is also known as Thacker Brothers Transportation, had 324 drivers and 344 powertrains, according to the Federal Motor Carrier Safety Administration’s SAFER website.
On Thursday, Aug. 29, a senior executive at HVH, headquartered in Denver, Colo., Said he was working to bring the drivers home, but says a dispute with the company’s bank is the reason for which the road carrier closed its operations without notice. He told FreightWaves he was negotiating with the US Bank to reactivate the fuel cards and get the drivers home.
The HVH official, who declined to be named, said the haulier had recently stepped up its hires of nearly 75 new drivers in recent weeks after receiving a new business award of around $ 15million. dollars.
“It was a total surprise because we had growth on both the revenue side and the truck growth side and we weren’t losing money so it wasn’t a negative cash flow situation,” said a framework of HVH.
He said the company needed an injection of funds to pay the new drivers and that 22 truckers were currently undergoing orientation for new HVH hires at its Colorado headquarters at the time of the shutdown. .
HVH is owned by HCI Equity Partners. A former HVH executive said HCI was prepared to invest an additional $ 1.5 million in the company to pay for the hiring of new drivers. He said the private equity firm had contacted the U.S. bank to negotiate a deal, but HCI wanted a concession from the bank that would allow the haulier to sell its old equipment in order to modernize its trailer fleet. The director of trucking claims the bank refused to negotiate a deal with HCI and HVH and was subsequently informed that the haulier was in violation of its forbearance agreement, which required HVH to have a minimum liquidity of $ 500,000 in the bank. bank. He claims the bank froze the carrier’s accounts without notice on Monday, August 26.
“We dropped a little below our minimum over the weekend and they used it as the default and they [U.S. Bank] declared not only that they would not allow the private equity firm to invest $ 1.5 million, but that they were going to take over the company and put it in Chapter 7, ”said the CEO of HVH at FreightWaves. “It happened overnight.”
In a statement, US Bank disputed the claims of HVH’s senior executive, but added that “generally speaking, we don’t discuss customer relationships,” said Cheryl U. Leamon, vice president and head of US Bank corporate strategic planning, at FreightWaves 28.
Shari Lee Campbell, former director of drivers for HVH, said there were red flags indicating the company was in financial difficulty in the weeks leading up to the business shutdown. She claims the drivers were not paid on time and the company was behind on its truck rental payments with both Ryder and Penske.
“We had been having payroll issues for almost a month and our phones and internet were cut off a few weeks ago for non-payment,” she told FreightWaves. “We were told that we were changing providers and that was the reason for the interruption in service. “
Campbell said she got a call about an hour before her shift started on closing day, telling her to come pick up her things because the business was shutting down. When we got to the office, the phones were ringing, but she said she was told not to answer. She said she ignored their advice.
“The drivers were calling to try to find out what was going on and I told them to go refuel their trucks immediately before their fuel cards were closed,” Campbell told FreightWaves. “At midnight the fuel cards were turned off and drivers reported they were stranded. “
She worked with 50 to 60 drivers to help them get home, which Campbell says HVH executives failed to do.
“Management has not contacted these drivers at all to help them get home,” she said.
Since January, the company has invested in 150 new tractors through Penske and Ryder to modernize its fleet. One-third of its drivers were business drivers and two-thirds were owner-operators and independent contractors with lease-to-buy agreements.
Drivers were instructed, via their electronic recording devices, to return their leased trucks to a Ryder or Penske dealership. On August 28, a Ryder representative at his Denver, Colorado office confirmed that he was working with HVH drivers to retrieve his leased equipment.
“We realize this is a bad situation and we want to be sensitive to what these drivers are going through,” said Ryder’s representative to FreightWaves.
Shortly after learning of the sudden shutdown of HVH on August 27, Heidi Jensen, director of human resources for Navajo Express, which is also headquartered in Denver, Colo., Said her company had stepped up to try and ” hire displaced drivers.
“We immediately started making calls and by early Wednesday morning our team sort of positioned themselves between our headquarters here and at HVH headquarters to help the drivers, who were coming back from the road and returning their trucks and basically helping them figure it out. how they were doing. going home, ”Jensen told FreightWaves.
“Several former HVH drivers who met our qualifications will now join us as drivers,” she said.
Michael Desalme had only been working for the company for three weeks when he found out the company was shutting down on Tuesday while moving equipment through the HVH terminal in Colorado.
“I was completely blinded by the news,” Desalme told FreightWaves. “I haven’t received my first paycheck yet.”
After the shutdown, Desalme said he spent the first night in his truck, but was forced to return his truck on Wednesday.
Even though he was not hired by Navajo, Desalme said the trucking company offered to pay for his bus fare to go home to Memphis, Tennessee.
“I’m basically homeless because the truck was my home,” Desalme said.
A senior HVH executive said the US bank had agreed to release $ 300,000 from company funds to pay the drivers, who will receive their checks on Friday, August 30.
“From a financial standpoint, it is in the bank’s best interest to do this because part of their liquidation value is $ 6.5 million of open accounts receivable and if those charges are not delivered, customers will offset open accounts receivable with claims so that the bank will get nothing, ”he said.
Some HVH customers pay fuel bills and compensate drivers to ensure their loads are delivered, Campbell said.
One day after HVH’s operations closed, another transporter, Ready for trucking, based in Ellenwood, Ga., announced it would cease operations on August 30. The company had 91 drivers and 108 powertrains, according to FMCSA’s SAFER website.
“2019 was the worst profitable year in the trucking industry in over five years,” said Craig Fuller, general manager of FreightWaves. “Even the 2016 downturn was not so painful in terms of operating losses.”
Nine medium and large carriers closed in 2019, including NEMF, Falcon and LME.