FARGO - Twin Cities-based trucking firm LME has abruptly shut down its operations, including its office in Fargo.
The man in charge LME’s freight terminals in Fargo, Bismarck, Minot and Grand Forks said he got the bad news in a phone call at 4:30 p.m. Thursday, July 11.
“The words were, ‘I got some bad news for you,’” Regional Manager Jeff Thoennes said Friday, July 12.
According to a message on the LME company webpage, “effective immediately LME will no longer be accepting any pickups.”
The Fargo terminal at 311 39th St. N. is one of 30 that are part of LME. The Fargo office employs 37 people, including long haul and local drivers, office and dockworkers.
None of them are being paid, though 20 to 25 had filtered in and out of the office throughout the day Friday, “just in loyalty to the company and the customers,” Thoennes said.
He and several supervisors have been handling calls from customers.
“We’re here just for the customers. Just because the customers need and want answers (about) where their freight is at,” Thoennes said. “We’re not allowed to give them anything out yet, because we have no employees here. Nobody is getting paid. We’re not holding their freight by any means, it’s just a matter of if you’re out there on the dock, you better be an employee. If you’re moving people’s freight, you better be an employee. And right now, that’s it in a nutshell.”
Thoennes said customers “are being very nice to us; a little disappointed in what’s going on with their freight.”
He said this is no longer a world of having warehouses full of product, relying heavily on “just in time delivery” from freight haulers like LME.
“That’s what we do, we move the freight from Point A to Point B in a timely manner. That’s very important to a customer. Right now, the freight is not moving in a timely manner by any means,” Thoennes said.
He said he has more than 200 customers to help at the Fargo terminal alone.
“I’m trying to be as courteous as I can. As soon as I can put somebody on the dock (and move freight), I will,” Thoennes said.
According to the company’s website, LME has terminals in 30 locations across the U.S. and through interline agreements services all of North America.
The firm said it had 100% blanket coverage in Illinois, Iowa, Kansas, Minnesota, Missouri, Montana, Nebraska, North Dakota, South Dakota & Wisconsin, and part of a broader network with links throughout the U.S., Canada, Mexico and the Caribbean
The company says it has more than 600 men and woman on its team, operating more than 1,200 tractors and trailers.
Thoennes did not know if LME will reopen, nor did he know if the company’s officers would be making themselves available for comment. The Forum left a phone message Friday morning at the firm’s headquarters number seeking comment.
Thoennes said a lack of business, a “softness” in orders to haul freight, and intense competition that keeps freight charges low, are what led to LME shutting its doors.
“We’ve been busy, but soft. Basically, it boils down to as the drivers wages get higher in order to retain drivers, and freight charges being so competitive, that all contributes to the (narrowing of the) operating ratio of the company,” Thoennes said. “I would have to say that would be the biggest reason.”
Thoennes said many LTL trucking companies have been struggling with thin margins. “They’ve been going down right and left” over the last few years.
Another issue may have some bearing is that LME has been at the center of litigation with the National Labor Relations Board and the Minnesota Department of Labor stemming from the 2016 closure of Roseville, Minn.-based Lakeville Motor Express.
Just before Thanksgiving of that year, Lakeville Motor Express filed for bankruptcy and suddenly shut its doors laying off 95 union drivers and dockworkers without pay.
Former employees alleged that the company moved its operations, changed its name to LME, Inc. or Finish Line Express, and staffed the carrier with “non-union” workers, according to a report by the Star Tribune.
Last year, the NLRB said its investigation found wrongdoing and described LME as an “alter ego” of the defunct Lakeville Motor Express. While LME officials strongly denied the NLRB’s findings, in January of this year the two sides came to an agreement, the Star Tribune reported.
The company agreed to issue back wages of $1.25 million to 89 of the 95 workers before June 2024.
As of April 30, 2019, the NLRB issued orders for LME to begin paying out the required back wages warning that failure to begin doing so within 60 days would result in the judgment ballooning from $1.25 million to $2.4 million.
In June, the first of the payments were made, disaffected workers told the Minnesota Star Tribune.
While the NLRB ruling resulted in one settlement agreement, there are also still unresolved lawsuits demanding millions of dollars from Lakeville Motor/LME for allegedly violating pension obligations, the Star Tribune reports.
Thoennes said he’s worked for 20 years, and has been in the trucking business since 1983.
He wonders what comes next.
“A long time … to just start over,” Thoennes said.