On October 9, 2025, Montgomery Transport, a major trucking company based in Birmingham, Alabama, suddenly shut down and filed for Chapter 7 bankruptcy. The company’s 1,000 workers lost their jobs immediately. Many drivers were in the middle of delivering loads when company leaders told them to stop working.
Their paychecks stopped coming, their fuel cards quit working, and some were left stranded at truck stops across the country with no way to get home. The company specialized in hauling steel, lumber, and building materials across the South and Eastern United States, operating a fleet of approximately 450 trucks.
The collapse came after a failed rescue attempt. Montgomery Transport’s owner, the private equity firm One Equity Partners, acquired the company in 2022 but decided to exit the trucking business in mid-2025, as freight rates declined and costs continued to increase. Another Birmingham trucking company, P&S Transportation, agreed to buy Montgomery and save the jobs.
Still, the deal fell apart just before closing when Rollins Montgomery, the founder of Montgomery, filed a lawsuit to stop the sale. Without the sale, the company ran out of money and had to liquidate completely. Financial records showed Montgomery owed more than $25 million to lenders from loans taken in 2022.
Why Trucking Companies Are Failing Across America
Montgomery Transport’s bankruptcy wasn’t a one-time problem. Between June and October 2025, dozens of trucking companies across the United States went bankrupt, with October seeing particularly high numbers.
Smaller carriers, such as Propel Trucking in Tennessee, R&R Transport in Texas, and Epic Lightning Fast Service in California, all closed their doors in 2025, with Epic Lightning laying off 116 workers. Industry experts now refer to this downturn as the “Great Freight Recession,” a three-year slump that began in 2022, following the end of the pandemic-driven shipping boom.
The recession happened because too many trucks started competing for too few loads. During the COVID-19 pandemic, online shopping surged, and trucking companies reaped substantial profits hauling packages and goods. This attracted thousands of new trucking companies and independent drivers who sought to capitalize on the boom.
But when pandemic-related shipping demand dropped back to normal levels by 2023, there were far more trucks available than needed—what the industry calls overcapacity. With so many trucks competing for the same jobs, shipping customers pushed freight rates down dramatically.
Spot market rates for dry van freight fell to around $1.93 to $2.09 per mile in 2025, down from about $3.00 per mile during the pandemic peak. Many trucking companies discovered they couldn’t cover their basic costs at these low rates.
At the same time, operating costs increased. Diesel fuel prices remained volatile, truck insurance premiums skyrocketed due to significant lawsuit judgments, and maintenance costs stayed high. In 2025, new tariffs added 25% to the cost of imported medium and heavy-duty trucks and truck parts, making it even more expensive to buy or repair equipment.
Day-to-day spot market rates hit small trucking companies the hardest, especially those that relied on them rather than long-term contracts with stable prices.
What’s Next for America’s Trucking Industry
The trucking industry’s troubles will likely continue into 2026, but analysts believe this painful period is necessary to restore balance. For over a decade, easy financing and high demand during the pandemic encouraged too many people to enter the trucking industry.
Now, weaker companies are exiting the market, which should eventually reduce the oversupply of trucks. Industry experts predict that consolidation, rather than expansion, will define the next phase.
Larger trucking companies are acquiring smaller, struggling competitors to expand their operations, while smaller, independent operators are being acquired or going out of business. Surviving carriers will focus on efficiency, utilizing technology to manage operations more effectively and maintaining tighter control over costs, rather than simply adding more trucks.
For shippers and businesses that rely on trucking, this means more stable service but higher freight rates once the excess trucks are gone and supply balances with demand. Some positive signs emerged in late 2025, including slight increases in freight demand and carriers becoming more selective about accepting low-paying loads.
However, economic uncertainty, ongoing tariff policies, and still-high operating costs mean recovery will be gradual. Despite all the struggles, trucking remains essential to America—trucks moved approximately 72% of U.S. goods by weight in 2024 and will continue to do so.
For the 1,000 former Montgomery Transport employees and thousands of other trucking workers who lost jobs in 2025, the immediate future remains uncertain. Until freight demand increases significantly or industry reforms address the structural problems, the Great Freight Recession will likely continue reshaping American trucking one closure at a time.