Standard Forwarding Freight suspends operations: What it means for automotive
Less-than-truckload carrier (LTL) Standard Forwarding Freight has suspended operations and reduced its workforce after almost a decade of business.
Standard Forwarding Freight
Standard Forwarding Freight announced that the decision was made following
a strategic review of the business, calling it a “difficult but necessary”
move. In a statement released at the end of December, the company added: “The
decision was made after careful consideration of the company’s current
circumstances and the need to conduct an orderly evaluation of the business. During
the period, Standard Forwarding Freight will undertake an operational
assessment to determine appropriate next steps.”
The carrier operated as a
regional trucking firm with 14 terminals and cross-docking services across
Illinois, Indiana, Iowa, Minnesota and Wisconsin. The carrier, which had 230
drivers and 302 trucks, moved automotive parts such as metal sheets, coils and
rolls, according to the US Department of Transportation Federal Motor Carrier
Safety Administration’s Safety and Fitness Electronic Records (SAFER).
The firm was acquired from DHL by car haulier Jack
Cooper’s private holding company Sakaem Holdings at the start of 2025, a month
before Jack Cooper ceased operations in February. Sarah Amico, previously CEO
of Jack Cooper after taking over the role from her father Michael Riggs, is
also CEO of Sakaem Holdings, with Riggs remaining as a board member of the private
holding company. Sakaem Holdings has an estimated revenue of less than $5m.
In an email to Standard Forwarding Freight’s
local unions, John Murphy, National Freight Director, Teamsters said the news
was “completely unexpected, as Standard Forwarding had never previously
communicated with [the] union any challenges or difficulties or attempted to
work to avoid this outcome”.
He added: “The Freight Division has requested
immediate bargaining with Standard Forwarding to obtain additional information
and secure whatever benefits possible during this difficult time. In addition,
we are exploring all legal options, including possible litigation, to enforce
any federal, state and local protections available to our members.”
The impact of Standard Forwarding Freight's closure on automotive logistics
The closure reflects broader struggles in the LTL
freight industry and vehicle logistics in general, with smaller carriers facing
intense competition amid slowing demand. With a high degree of industry fragmentation,
there is a strong downward pressure on prices, meaning margins are squeezed and
cashflow is tight. In 2024, Automotive Logistics revealed that the leading
ten FVL firms in North America only accounted for 32.5% of the overall market.
Having such limited cash flow means a lack of
flexibility and financial resiliency to face disruptions, and also means it is
cost prohibitive to make investments in fleets. To combat this, some of the
larger firms have been making acquisitions in an aim to boost scale and
competitiveness, such as DSV’s
acquisition of DB Schenker.
But in some cases, such as Jack Cooper’s,
financial pressures hit before acquisitions can be completed.
Jack
Cooper wound down operations in February last year, following a breakdown
in its contracts with GM and Ford. The hauler had been renegotiating contracts with
the OEMs, two of its biggest contracts, before unilaterally stopping services. The
firm had been looking to acquire LTL provider Yellow, which filed for
bankruptcy in August 2023, but dropped its bid eight months after the filing in
April 2023 after an alleged lack of engagement from Yellow.
Financial pressures had hit Jack Cooper previously,
in 2019, when it reorganised
its business under Chapter 11 proceedings following an underfunded Teamster
pension that was leading to almost-certain insolvency. The company exited
bankruptcy proceedings in the same year, extinguishing around $250m of debt and
permanently removing $2 billion of underfunded pension liability.
If other LTL firms face the same outcome, there could be reduced LTL capacity, more noticeable
in regional lanes, with less trucks, terminals and drivers circulating in the
market, meaning fewer options for shipments and service disruptions and delays.
Rates will be likely to rise, with spot rates the first to jump, followed by
contract rates.
In response, OEMs may hedge against this with higher
safety stock holdings and increased use of expedited freight, increasing costs
and complexity. Carmakers that want to avoid the risk of relying too heavily on
a small set of carriers could expand relationships across multiple LTL carriers
and engage logistics service providers with broader networks to help cushion
the impact of any further carrier disruption. Modal shifts to full truckload (FTL)
and intermodal transport could become more popular.
Since the company announced the suspension of operations, there have been indications that the closure could be more permanent than first suggested.
It has been revealed that Standard Forwarding Freight’s fleet is set to go up for auction. In mid-February, Purple Wave Auction, a fleet equipment auction company based in Kansas, announced that will hold an auction on April 21 for the sale of the less-than-truckload carrier’s freight.
The auction package will include semi tractor, remote tractors or semi trucks, and support equipment offered to the public through a no-reserve online auction. Owner-operators, transportation companies and fleet buyers will have an opportunity to outfit their fleet with assets from the Midwest carrier.
In a statement, Zackery Witvoet, district sales director, Purple Wave Auction said: “this sale represents the orderly transition of a respected regional fleet to the next phase of its lifecycle.”
He added: “Our team is honoured to partner with Standard Forwarding Freight to bring these assets to market in a transparent, competitive online auction environment that reaches qualified buyers nationwide.”
At the time of publishing, there has been no confirmed Chapter 11 bankruptcy filing publicly tied to Standard Forwarding Freight itself in official court dockets.
