Administrators sound death knell at Amtrak
Four hundred jobs are to be lost in the West Midlands with the collapse of the parcel delivery business Amtrak.
The death knell on the Walsall-based business was finally sounded by administrators on Thursday.
The closure of the Aldridge hub, which also serves as the company’s head office, will result in 400 workers being made redundant. It is also closing its 35 other depots across the country with the loss of a further 500 jobs.
Joint administrators Ernst & Young had spent the week at the Aldridge office in an attempt to salvage something from the collapse of the business.
However, interest was minimal, perhaps due to the current economic conditions, and Ernst & Young announced that the company, owned and operated by Netfold, was being wound up.
An Ernst & Young spokesman said: “The business will be wound up by the end of the week. So far 50 staff at the Aldridge site have been made redundant but it is likely that all employees will be made redundant by the end of the week.”
The high cost of fuel and the squeeze on consumer spending have been blamed for the collapse of the business.
Rival operator Business Post has been appointed to deliver any outstanding parcels stranded at the various depots around the country.
It has trying to capitalise on the situation and has sent emails to Amtrak clients offering to take on their business.
This is supported by a message on the Amtrak website, which states: “Netfold Limited t/a Amtrak went into administration on 22 August 2008 and has ceased trading. Should you have any parcel collection or delivery requirements, you may contact Business Post Limited, which will be happy to provide an alternative service.”
Workers at the Aldridge facility voiced anger and shock at the closure. Phil Smith, who has been with Amtrak for 12 years, said: “I thought things were bad across the company, but I didn’t realise it was this close to the end.”
Amtrak was launched in 1987 and chose the West Midlands as its base because of the region’s key location at the heart of the national transport network.
It had built up a nationwide network of depots and had more than 1,000 delivery vehicles operated by staff and franchised drivers.
Extensive investment had been made in the Aldridge distribution centre to make it one of the most efficient of its kind and the company was looking to develop the business into one of the major logistics operations in Europe.
In addition to Aldridge, the company’s other major hub is in Warrington, while one of the depots affected by closure is in Hereford.
In an earlier statement, Ernst & Young said: “Amtrak has found trading in the current economic climate challenging. It is a business led by consumer demand and as consumer spending power has weakened Amtrak’s business has suffered.”
Amtrak acquired the assets of Nightspeed Services in August 2005 and the whole business was sold to Netfold early last year.
The deal was said to represent a “landmark” for the company, bringing ownership back into the transport and logistics market for the first time since 1998.
Netfold was said to represent “one of the industry’s most experienced management teams with a solid background in the express parcels, freight and logistics business sectors”.
In April, as part of its ongoing investment strategy, Netfold announced a major expansion designed to make the firm one of Europe’s main logistics companies.
Managing director Alan Jones was quoted as saying: “We will have one of the most modern fleets in the business, increasing efficiency, reliability and, importantly, helping us meet our commitment to reducing carbon emissions.”
Allied to this was investment in new IT systems and a reorganisation of the depot network, designed to make the operation more efficient.