US finished vehicle haulier Active Transportation has bought a majority stake in one of GM’s oldest hauliers, Jack Cooper Transport, establishing a merger and new company called Cooper-Active.
The company will be based in Kansas City, Missouri and employ 1,000 workers. Details of the transaction were not disclosed.
Greg May, President of Cooper Transport, will be President of the new entity.
The merger comes as hauliers in the US face dramatic drops in volumes. Mike Riggs, owner of Active Transportation and leader of private equity firm Innovative Equity Partners, said that consolidation in the car haulier sector was inevitable given the distressed nature of the automotive industry, with Chrysler already in bankruptcy and GM about to enter it. Cooper Transport has been moving vehicles for GM since 1928 but the carmakers production volume dropped 40% in Q1 this year, with revenue dropping 47% from a year ago.
Active Transportation mostly shifts vehicles for Ford, Toyota and Honda and, though none of those carmakers are facing bankruptcy, from January through to the middle of May this year North America made 2.7 million vehicles, almost half that made in the same period last year when 5.4 million vehicles were produced.
Working as a combined carrier will better utilise equipment and reduce empty return legs but the company’s operate in different regions in the country and neither expects to have to combine terminals.