Monson Trucking, based in Duluth, is shutting down operations for good by Aug. 31, putting 200 people out of work.
Many of its 100 employees in Duluth were told Wednesday in multiple meetings, said Michael Monson, one of the owners. They include truck drivers, mechanics, office staff and management.
"They looked pretty shocked," said Monson, acknowledging it was a tough day for everybody.
A Monson truck driver, Michael Globe, was hauling freight to Canada when he heard the news Wednesday from a dispatcher.
"It was a surprise, a big surprise. I didn't see it coming," said Globe, a
22-year employee and union steward. "We knew we were slow, but we didn't know they were going to shut down."
The economic downturn, decline of the paper industry and the bankruptcy of two major customers -- both Canadian paper mills -- prompted the decision to close the 94-year-old, family-based trucking business, Monson said.
The decision was made this week, but had been considered for a long time because of lost revenue, including $500,000 in losses from the two Canadian paper mills, Monson said.
Company officials had looked at all options, including cutting back and more layoffs, he said.
"None of them were viable," he said.
About 100 additional employees -- at Monson's terminals in Virginia, Red Wing and Mauston, Wis. -- were told of the coming shutdown and their job losses via video conferencing on Wednesday.
Duluth employees will work until the company shuts down on or before Aug. 31; the others were done Wednesday, Monson said.
The company's total employee payroll was $11.8 million in 2008, according to a company statement.
The closure comes despite recent concessions made by union members, including a pay cut and reduced health coverage. In addition, Globe said 50 drivers had been laid off in the past seven months.
"I'm confused and a little upset that after all we did for them, that they're closing shop," said Globe, who received company accolades in 2006 for driving 1 million consecutive miles without an accident.
Monson Trucking is a four-generation family business that started in 1915 in Zumbrota, Minn., with teams of horses and dray wagons hauling freight to stores and coal to homes. Trucks eventually replaced horses and the business grew to include terminals in Red Wing, Duluth, Virginia and Mauston. Duluth became the company's headquarters in 1983.
The company will liquidate all its equipment -- including tractors, trailers, tools and front-end loaders -- in auctions at its Mauston and Duluth terminals in September.