NJ Trucking Firm Fastline Cargo Files Chapter 11

Fastline Cargo (FLC), a New Jersey-based trucking company, just filed for Chapter 11 bankruptcy. Here's what you need to know:

The Big Picture:

• FLC filed on Monday in New Jersey's U.S. Bankruptcy Court
• Assets and liabilities: $1-10 million range
• Company has up to 99 creditors, maintains funds will be available for distribution once administrative fees are paid

FLC's Numbers:

• 41 drivers, 54 power units
• 4 injury crashes, 3 tow-aways in past 2 years
• $4.4 million gross revenue in 2024 (year-to-date)
• $12.6 million revenue in 2023

Safety Concerns Flagged:

FMCSA has cited numerous violations from FLC, the number were quite alarming:

• 31% out-of-service rate for trucks (national average: 21%)
  • FLC's trucks had been inspected 64 times, 20 of their trucks were out of service over a 24-month period.
• 13.4% out-of-service rate for drivers (national average: 6%)
  • FLC's drivers had been inspected 112 times, 15 of their drivers had been placed out of service over a 24-month period.
• Out of 112 driver inspections, 29 were hours-of service violations, flagged as acute/critical violations by SAFER.

Next Steps:

1. FLC had it's first hearing August 1 for the first-day motion
2. FLC is seeking approval to pay $80,000 in pre-petition wages
   1. Wages are for employees for weeks ending July 20 and July 26
   2. Payroll taxes and workers' compensation insurance
3. FLC is pursuing post-petition financing agreement with RTS Financial Services.
   1. FLC owes more than $881,000 in secured collateral.

Key Players vs Top Creditors

CEO Amanjot Kaur (51% ownership) and COO Amritraj Singh (49% ownership) are being tasked with paying pay a lot of creditors, among the top of the list they owe the flowing to these companies:

• Fulton Bank of East Petersburg: $2.2 million
• Libertas Funding of Greenwich: $492,000
• Santander Bank of Boston: $208,000

The Road Ahead:

FLC's bankruptcy filing highlights the challenges facing trucking companies with safety issues. As the case unfolds, industry watchers will be keen to see if the company can successfully reorganize and address its operational concerns.

Source: FreightWaves