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The sudden closure of Morgan Drive Away late last week left some drivers and their rigs stranded en route, at least temporarily, according to the South Bend Tribune newspaper in Indiana.
As a result, some RV manufacturers likely had to scramble in the last few days to make sure their motorhomes and towable RVs were delivered to their final destinations.
Morgan Group Inc., abruptly shutdown Oct. 3 its two operating subsidiaries, Morgan Drive Away and TDI, because it lost its liability insurance and was unable to secure a replacement policy.
Then, on Oct. 4, the Elkhart, Ind., company announced it would file for bankruptcy “within the next few days.”
Last week’s developments left driver Tim Harkey in a tough spot for a time, according to the Tribune.
Harkey, who lives in Phoenix and Cartersville, Ga., was driving a Monaco Coach Corp. unit from Wakarusa, Ind., to a dealer in Las Vegas when he discovered he would not be paid. Concerning the Monaco unit he was driving, Harkey told the Tribune that Morgan Drive Away officials said he should “secure it and dump it.”
Harkey was in Colorado when he learned that Morgan Drive Away had gone out of business, but Monaco Coach spokesman Mike Duncan said Monaco was stepping in to help drivers get to their destinations.
Concerning the impact of Morgan Drive Away’s closure on Monaco’s ability to ship units to its dealers, Duncan told the Tribune, “Frankly, this did not come as a surprise and we had made contingency plans. The impact is lessened by the fact that we use other carriers.”
Morgan Drive Away paid its drivers, who work as independent contractors, by issuing them debit cards that can be used in numerous ATM machines. Some drivers quickly transferred their Morgan Drive Away wages into their personal bank accounts, but Harkey did not, leaving himself owed more than $3,000.
In its statement issued Friday, Morgan Group said it would “pursue Chapter 11 liquidation of all assets and liabilities.”
Morgan Group’s closure was anticipated because the company lost almost $6.9 million in the first half of this year on sales of $34.4 million, about half of which came from the struggling manufactured housing industry.
Morgan Group, an American Stock Exchange-listed company, sold its money-losing manufactured home delivery business in August to a competitor, Bennett Truck Transport LLC of McDonough, Ga., for $1.05 million, according to Securities & Exchange Commission (SEC) documents.
Morgan Group’s manufactured home delivery business lost almost $4 million during the first half of this year while its RV-related delivery businesses lost a total of $1.03 million during the six months ended June 30, it reported to the SEC.
Among Morgan Group’s 10 largest customers, six were manufactured housing firms, including Fleetwood Enterprises Inc.’s manufactured home operations, according to SEC reports. In the RV industry, Morgan Group listed its largest customers as Winnebago Industries Inc., Thor Industries Inc. and Thor’s Keystone RV Co. subsidiary and Monaco’s Holiday Rambler operation.