VIB Trans, Inc., an Illinois-based trucking carrier operating a fleet of 29 trucks, has filed for Chapter 11 bankruptcy protection amid the Great Freight Recession, the longest downturn in trucking history. Headquartered in Wood Dale, a suburb of Chicago, VIB Trans employed 34 drivers to support its operations. According to federal safety records, the company started in 2018.
Chapter 11 bankruptcy lets businesses like VIB Trans keep running while they work out a plan to pay back debts, hopefully avoiding a full shutdown. This filing comes during a turbulent period for the trucking sector, with multiple carriers succumbing to financial pressures. Trucking volumes have dropped by 18% year-over-year, as the industrial economy has collapsed.
The trucking industry is going through a very challenging time. Since 2019, over 200,000 non-domiciled commercial driver’s licenses have been issued, contributing to the influx of more than 310,000 trucks and flooding the market with excess capacity.
This overcapacity has turned the trucking industry into an economic backwater, where new entrants squeeze out veterans and keep rates depressed. The upcoming expiration of SNAP funding could cause the bottom to fall out of the market, as government assistance has been a key driver of freight demand.
Earlier in October, a major flatbed operator ceased operations, leaving 1,000 employees, including 600 drivers, out of work. An Alabama-based trucking firm also filed for Chapter 7 liquidation, slashing another 1,000 jobs.
Smaller carriers like VIB Trans, with fleets under 50 trucks, are particularly vulnerable in the current environment of elevated operating costs and low demand.
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