The Haulage Group’s collapse caused in part by HS2, says administrator

The company, which offered automotive haulage, pallet distribution and storage services, was originally approached in 2009 about the proposed HS2 development and it was indicated that the proposed route would pass through its site.

However, according to insolvency experts at CG & Co, nothing further was heard for 10 years until 2019, when it was advised of a compulsory purchase order on its premises.

In a report to creditors, the administrator said: “The HS2 developers gave the company one month to vacate the site. However, when the Covid pandemic struck in March 2020, the company was initially advised that the period would be extended.

“Unfortunately, this information was false and the company was given one week to vacate.”

CG & Co said that the sudden and enforced move from the haulier’s Nechells premises resulted in severe costs to the business, as well as the loss of contracts and compromised its ability to grow.

It was able to purchase a new site in Minworth in June 2020, but then the effects of the pandemic hit its haulage and freight side too.

In addition, the administrator said: “The company suffered a further setback when a depot worker for another company was struck by a vehicle reversing out of the company’s parking space causing his tragic death.

“This led to legal proceedings being commenced against the company and another third party, which resulted in the company being fined £300,000 plus costs.”

The Haulage Group’s financial situation was further blighted by a decision to purchase a recycling machine that produced pure copper granules from waste cables after it diversified into recycling:

“It soon became apparent that the machine was not capable of producing pure copper granules to the levels or volumes upon which it was supposed to,” the report said.

“It had been understood that it should produce nine to 12 tonnes per hour, but it was only producing approximately two tonnes per hour.”

Its cashflow problems intensified and it built up arrears with HMRC before it collapsed into administration on 28 May this year.

However, CG & Co added that it had been able to save 26 jobs after most of The Haulage Group’s employees transferred to a related business, Maybrook Fleetcare and it granted Maybrook a licence to occupy the haulier’s property.

Maybrook and The Haulage Group share the same director, Graham Johnston and vehicle operator licensing records show that the new business currently holds a licence authorising a total of 20 HGVs and 20 trailers running out of two operating centres.