NFI, one of the largest supply chain solution providers in the US, announced Monday that they have acquired California Cartage and its affiliated companies.
NFI is based out of Cherry Hill, New Jersey. The company is privately held by the Brown family since 1932. They provide retailers, food, technology companies, and sports teams with transportation and distribution services. Some clients include Ocean Spray, Lowe’s, Subaru of America, Rent-A-Center, Express Scripts and the Philadelphia 76ers.
CalCartage is a service provider based out of Long Beach, California. The company was founded in 1944 by the Curry family. CalCartage is the premier US port logistics company serving many of the largest nationwide companies.
According to NFI, the new acquisition would expand its port drayage, transloading, deconsolidation, customs examination, and warehousing solutions.
NFI is excited to announce its acquisition of California Cartage and its affiliated companies! Learn more here: https://t.co/nL4lCLewBM pic.twitter.com/MMPf6Hck7m
— NFI Industries (@NFIindustries) October 2, 2017
Since NFI now owns CalCartage, NFI has become the largest family-owned, vertically integrated 3PL in the US with top 10 services dedicated to transportation, distribution, and drayage. The newly merges companies are estimated to generate $2 billion in annual revenue in 2018.
NFI CEO, Sid Brown, commented on this merger saying, “I am excited to welcome CalCartage’s employees and customers to our NFI family. Together, we will expand our capabilities, better connect our domestic and international platforms, and create true end-to-end solutions. With our employees’ collective expertise and shared commitment to exceptional customer service, NFI becomes a supply chain powerhouse that can deliver value at a new level to our blue chip customer base.”
“NFI is a perfect cultural fit for the CalCartage family and is why we sought them out since the beginning,” said Bob Curry, Sr., CalCartage owner, and Chairman. “Our people have built up this company over its long history, and NFI is an ideal organization to grow with and provide more opportunities for our employees, independent contractor partners, and customers.”
NFI now distributes to 41.5 million square feet. Services include a portfolio that consists of warehousing, e-commerce, automated, cross-dock, transloading, and customs examination facilities. More specifically with CalCartage, NFI can now provide specialization retail, e-commerce, footwear, and apparel sectors.
Reputation at stake
Although NFI reports on their website that their company has been recognized as a best workplace, their reputation could be at risk with the acquisition of CalCartage.
CalCartage has been the subject of multiple employee lawsuits and wage complaints. Dozens of complaints have been filed by drivers who allege that they were cheated out of fair pay after signing to lease-to-own contracts on their rigs, according to NorthJersey.com.
In June, USA Today released a study that showed CalCartage affiliate companies were coercing drivers into taking on the debt of their rigs without the proper income to finance such a large debt.
The lease-to-own program was originally designed to overhaul the company’s fleet to consist of more environmentally friendly clean trucks.
Since 2012, at least 30 CalCartage drivers have filed lawsuits in civil court and wage complaints with the California Labor Commission. All cases involved drivers that were allegedly cheated of fair pay after agreeing to lease-to-own a truck.
Drivers claim that the lease-to-own contracts were not accurately explained or translated properly into their native language – for a large number of drivers English is not their first language.
NorthJersey.com reported that some drivers were working up to 15 hours a day, 6 days a week, in order to make their truck payments. Unable to afford further payments, many drivers had to quit and lose all the money they had already invested in their trucks.
One driver told USA today that of the $94,000 gross income he made, he only kept about $21,000 of it. Eventually, the same driver had to sacrifice his house in order to be able to afford food for his family.
Thus far, the labor commissioner has awarded only $690,000 to drivers at CalCartage affiliates. Many claims were for more than $100,000; however, some settlements awarded were only $2,000.
What this means for NFI
Amber Burruezo, a spokeswoman for NFI, did not respond to questions about the CalCartage complaints or if NFI plans to continue the lease-to-own program for their truck drivers.
California Cartage declined to comment for USA TODAY Network’s investigation in June.
Chairman of CalCartage, Bob Curry Sr., commented on NFI’s acquisition of CalCartage saying that NFI is “a perfect cultural fit.”
It is unclear at this time whether NFI will become involved in any past or future cases against CalCartage for wage complaints or fair pay.