Everett trucking firm is stuck In the slow lane

EVERETT — Steve Holtgeerts doesn’t need economists to tell him how the global economy is doing.

His company, Hogland Transfer Co. Inc., mirrors the ups and downs of the global economy, Holtgeerts said. This fall, the Everett-based trucking company’s business is down about 30 percent compared with a year ago, as a sluggish economy slows down the flow of goods.

“This is probably an uncharted territory for a lot of us,” Holtgeerts, 51, said.

The company distributes construction materials, retail goods and other items from all over the world, Holtgeerts said. Since July, those items started sitting longer than usual in the company’s warehouse before being delivered to customers. Now, the company is operating about 60 percent of its fleet with 54 trucks and 150 trailers, Holtgeerts said.

“Unfortunately, we’ve had significant layoffs over the last 60 days or so,” he said.

Hogland has laid off about 10 employees and reduced hours for several others, Holtgeerts said. It now has about 70 people, including about 15 employees who work limited hours.

“That part has been very difficult,” he said. “We are hoping we can bring everybody back.”

The company operates 24 hours a day, Monday through Friday, primarily within a 200-mile radius of Everett, Holtgeerts said. It also has a distribution center in Moses Lake.

Washington state is heavily dependent on international trade. As the U.S. economy slows down and its consumer confidence sags, fewer retail items such as clothes and toys are being shipped from Asian countries to ports in Seattle and Tacoma, said Mark Calhoon, senior managing director for the international trade and economic development division of the state’s Community, Trade and Economic Development department.

Earlier in the year, a weak U.S. dollar had boosted exports this year, but things are changing rapidly, Calhoon said. The global economy seems to be slipping into a recession amid the financial crisis. That would bring down the demand for U.S. exports.

“It’s a volatile situation,” he said.

As a sign of global economic slowdown, oil prices have fallen since they reached a record high $127 per barrel in July. While that’s good for commuters, it’s not helping Hogland Transfer Co. as much, Holtgeerts said.

“Trucking businesses tend to feel the economy’s slowdown fast because we transfer goods,” he said.

The Boeing strike that lasted for nearly two months has made things worse, Holtgeerts said. The aerospace giant is one of the trucking firm’s major customers.

“Boeing is still the major engine of the economy in the Puget Sound region,” he said.

The trucking company usually has a busy time in late summer and early fall, as construction activity picks up and retailers start preparing for the holidays, Holtgeerts said. But this year is different. “Our warehouse is quite full,” he said. “For us, it’s good to churn out inventory and move things out.”

Meanwhile, the challenging time allows the company to diversify its customer base and seek innovations, Holtgeerts said. The company, founded by his grandfather in 1933, celebrated its 75th anniversary in September.

“We’ve been in business for 75 years,” Holtgeerts said. “It’s not going away on my watch.”

Holtgeerts believes he’s yet to see the bottom of the current economic downturn. “I believe part of the solution is that the government can invest in its infrastructure, which will lead to jobs in construction,” he said.

Reporter Yoshiaki Nohara: 425-339-3029 or ynohara@heraldnet.com.