The freight industry faced a significant downturn in 2025, leading to a wave of bankruptcies among trucking, logistics, and shipping companies. The Great Freight Recession prompted many companies to seek Chapter 11 bankruptcy protection in order to reorganize their businesses, restructure debt obligations, and try to stay afloat.
Various factors were cited for the decline in revenues and profits, including reduced shipping demand, lower freight rates, and rising costs such as labor, fuel, and insurance. Unfortunately, some companies were unable to successfully reorganize under Chapter 11 and had to liquidate their assets instead. This gave debtors more control over the distribution of assets, allowing them to manage the process more efficiently.
In more severe cases, companies resorted to filing for Chapter 7 bankruptcy, which involves the liquidation of assets overseen by a Chapter 7 trustee. This method takes control away from the debtor and can be a last resort for companies facing insurmountable financial challenges.
Throughout 2025, a significant number of freight companies filed for bankruptcy. In the second quarter, 20 petitions were filed, followed by 21 in the third quarter. While final statistics for the fourth quarter were not yet available, it was reported that 12 petitions were filed in October and six in November.
One notable Chapter 11 filing in 2025 was by the 102-year-old Port Elizabeth Terminal & Warehouse Corp., a company specializing in shipping, logistics, and warehousing. The company sought bankruptcy protection in order to restructure its business and debts to secure its future.
The trend of bankruptcies continued into 2026, with several prominent trucking companies filing for Chapter 11 protection. STG Logistics Inc., the largest among them, filed for bankruptcy in January to restructure approximately $1.2 billion in debt and explore the sale of its assets. Subsequent filings included companies like Newkirk Logistics Inc., Mast Trucking Inc., and Bee & G Enterprises LLC.
One of the most severe bankruptcies in 2026 was T.G.S. Transportation Inc.’s Chapter 7 liquidation filing in February. The 40-year-old drayage trucking company based in Fresno, California, listed its assets and liabilities in the U.S. Bankruptcy Court for the Eastern District of California. The filing came after the company announced the closure of its operations in July 2025, citing challenging market conditions in the trucking industry.
T.G.S. Transportation operated interstate shipping with a fleet of 20 trucks and 20 drivers, hauling a variety of goods ranging from general freight to agricultural supplies. The company’s decision to file for bankruptcy was a difficult one, reflecting the tough realities faced by many companies in the freight industry.
Overall, the wave of bankruptcies in the freight sector underscored the challenges posed by the Great Freight Recession and the need for companies to adapt to changing market conditions in order to survive.
