Michigan-based DIS Transportation and affiliate company DIS Express have filed Chapter 11 bankruptcy with the U.S. Bankruptcy Court for the Western District of Michigan.
The company listed $392,000 in assets and $569,000 in liabilities. The largest claims were $306,000 (secured by property) and business debts of $100,000 to PNC Bank and $90,000 to a truck and trailer repair company.
The carriers operates out of Grand Rapids and Kentwood, Michigan, with a fleet of 23 power units and 25 drivers, according to the Federal Motor Carrier Safety Administration’s SAFER website. The bankruptcy filing listed 22 trucks and 6 trailers as assets.
The filing last week showed that the company’s gross income had increased from 2009 to 2018, reaching $8.5 million annually. However, a 50% decline in freight rates in late 2018 resulted in the company being “unable to sustain its overhead.” The carrier began working with a consultant in 2019 and eliminated the owners’ salaries, which allowed it to reduce outstanding liabilities from $1.7 million to the amount filed in the petition.
An improving rate environment “in the weeks leading up to the petition date” was cited, but the jump in truck rates was too late as the company had already defaulted on several loans and creditors were threatening the repossession of their vehicles.
“Left with no other options,” the company filed for relief under Chapter 11 “while it seeks to restructure its business through the reduction or elimination of certain liabilities.”