Trailer-maker in bankruptcy

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This article was published 05/05/2010 (5604 days ago), so information in it may no longer be current.

Gravhaul Trailers, once an up-and-coming Winkler industrial trailer manufacturer, has been placed into bankruptcy.

Less than a year ago, the 45-person firm invested in a new production facility and was trying to capture market share from longstanding manufacturers like Arne’s and Midland Manufacturing.

But soft demand in 2009 from the construction industry and a competitive market with few barriers to entry by companies that are primarily in the welding business created a challenging environment for all but the most established trailer companies.

The company’s filing with the Office of the Superintendent of Bankruptcy Canada lists total liabilities of $2.3 million and assets of $929,820.

Bruce Caplan, a trustee with BDO Canada Ltd. in Winnipeg who is managing the file, said competition and the poor economy conspired to put the company in a jam.

A creditors meeting is to be held May 14 at 11 a.m. at BDO’s Winnipeg offices.

One Winnipeg trailer dealer said although the economy has softened, longstanding manufacturers have been better able to weather the storm.

Caplan confirmed that Winkler-area business man John Fehr was the lender who initiated the bankruptcy proceedings.

Caplan said the intention is to attempt to sell the business as a going concern.

Former owner and founder Peter Bergen said he believed there were other options available and that the bankruptcy route was not necessary.

Bergen said a reorganization strategy he proposed that would have paid out creditors was rejected and he was ousted from the company.

"People want to buy trailers from me," he said. "We still have good orders coming in."

Although Caplan said the business remains open, there was no answer on any of the lines at the company’s Winkler phone number.

Bergen also owns Berg’s Prep & Paint, a Winkler autobody repair and detailing business.

That business accessed funds from the Community Futures Heartland in Winkler for construction of a new building about six years ago. An official with Heartland in Portage said that loan has been repaid.

Arne’s Welding of Winnipeg has been making gravel and custom-engineered heavy duty trailers for 50 years. Doug Harvey, CEO of Maxim Truck & Trailer, owners of Arne’s, said, "The market is better this year than last but is still not back to normal levels."

He said the value of the Canadian dollar has meant there are more American manufactures that can be competitive in the Canadian market.

He said since demand for gravel trailers from the construction business is off, new lower-priced competitors are finding it hard to survive.

"The gravel trailer business is very competitive but we also build specialty trailers that are engineered to order," he said.

martin.cash@freepress.mb.ca