Coronavirus on the road: Trucker shifts cargoes, lobbies for toilets to keep its 14,000 drivers, warehouse staff from layoffs

“It looks bleak. But it’s looked bleak before, and we’re still here. This won’t go on forever,” says Sid Brown, chief executive of NFI, the $2 billion-a-year, Camden-based nationwide trucking and warehouse company that his grandfather Israel Brown started in the Depression year of 1932.

Brown says he and other business owners have had to push national and state leaders to take practical steps to contain the coronavirus without shutting down vital services.

“We went ballistic” when Pennsylvania shut flush toilets and other facilities at Turnpike and Interstate restrooms last Monday, Brown said. “New Jersey was thinking about doing it, too. We told some of the politicians, ‘You will kill us if you do this. You gotta make sure guys [supplying hospitals, grocers, and employers] can get to the bathroom and take a break.’ ”

The national American Truckers Association asked President Trump to intervene.

The state backed down: PennDot agreed Wednesday to open portable toilets at 17 of 46 shuttered highway rest stops, and the Pennsylvania Turnpike said it would reopen flush toilets and some food service at its service areas by this weekend.

Were state and local leaders unprepared? “We need to forget what wasn’t prepared, and focus on what we need to do. Move forward. Solve the problem,” Brown said. Is government moving slower than in past crises? “It’s no better. But information is instantaneous today,” so it’s easier to see what hasn’t been done.

The group run by Brown and his brothers employs 12,600 warehouse workers, truck drivers and office staff, plus more than 1,000 contractors, at sites across the U.S. enclosing 50 million square feet of warehouse and other space, as big as all the offices in Center City Philadelphia.

No layoffs, so far, though the Browns have had to shift drivers off routes that stopped supplying stores and factories shut by coronavirus fears.

Two-thirds of the business is “the basic staples — food and groceries, water, beverages, paper. … Stuff that people have to use every day,” says Brown, 62. “It’s not glamorous. It grows with the population. But it’s steady-Eddie and it will be resilient in downturns."

Indeed, “right now our trucking operations are really busy moving all the things people are rushing out to buy. People are starting to understand we are not going to run out of toilet paper.” But rubbing alcohol and some other basic cleaning agents are still in short supply.

“We are beginning to see some customers shutting their stores down — TJ Maxx, Kohl’s," he said. "Their fleet deliveries are being scaled down. We are deploying those trucks into food, groceries, water.”

It’s not just retail that is cutting back. Last fall NFI bought G&P Trucking, based in South Carolina, the latest of a string of purchases in the South, West, and Canada.

“They do a lot of automotive business. That’s starting to scale down,” as auto plants send workers home. If it continues, “we may have to have some of those guys work four days a week.” NFI didn’t have to do that in the Great Recession in the late 2000s.

It’s worse for the smaller, specialized truckers. “A friend of mine hauled flowers,” Colombian imports through the Port of Miami to florists. “But now he’s out of business. No one’s doing shows or weddings or catering. If he’s heavily leveraged [in debt] and won’t make the payments, he’ll park the trucks. If he’s got enough stability and enough pockets [of cash], he’ll survive. Or he’ll go bankrupt,” and creditors will probably buy what’s left of the business at a discount.

“A lot of the smaller truckers live on a very short string. They don’t have reserves, they have nowhere to go” when orders and credit dry up.

“It’s crazy, man. This is the fourth crisis in my lifetime,” said Brown.

During the savings-bank blowup of the late 1980s, “we were one step away from bankruptcy" when lenders suddenly began calling in loan repayments. "That was a scary time.”

It was a shocking end to the easy-credit years of the Reagan administration. “My first warehouses, in Florida and New Jersey, I got almost 100 percent (borrowed) financing,” from lenders who didn’t require the usual stiff down payments, he marveled. “The banks were getting lots of money and they weren’t paying enough attention.”

He had borrowed a lot to buy trucks. “The downturn hit with a double whammy — too much leverage, not enough business.” NFI rebuilt.

A dozen years later, Brown bought into the internet bubble, “I started a logistics company. I raised a lot of money on the outside. We were ahead of our time, setting up warehousing and fulfillment services to for companies’ online sales. We got Lowe’s as a customer. But there weren’t enough sales.”

Then there was the slowdown following the mortgage-banking crisis of 2008-09. A couple of big, New Jersey-based trucking companies — heavily leveraged to private-equity investors — failed, throwing thousands of non-union drivers out of work. Brown said NFI had avoided over-borrowing and didn’t have to lay its people off.

This time, Brown marveled how Amazon, the nation’s top retailer, has unilaterally announced it was going to stop carrying “nonessential” goods so it can haul more bottled water and medical supplies.

Amazon’s decision will have ripple effects on the economy, “'If you’re in the toy business or in the fan business or a lot of other ‘nonconsumer-essential’ businesses, you just lost a major customer," Brown warned. Unlike Amazon, Walmart and Target have vast store networks where they can continue to hold and sell other items. Will suppliers hold Amazon’s failure against the company and seek rival places to sell? “Amazon is so busy, they don’t have to worry about that business," Brown said. "And I don’t know that [suppliers] can quickly find another outlet.”

And that’s the big question, for policymakers trying to keep Americans employed. With warehouses and truckers, "how do you keep them going, how do you keep your people safe? If you get somebody infected in your facility, you have to close the facility, you have to do a thorough cleaning. If you get a large outbreak, you’ll need a massive cleaning. You could be closed some time. So our No. 1 priority is to protect our people so we can keep operating.”