VANCOUVER, Wash. – Consolidated Freightways has filed for Chapter 11 bankruptcy, however subsidiary Canadian Freightways is expected to remain unaffected.

“I am disappointed Consolidated Freightways could not right their financial situation,” says Canadian Freightways president, Darshan Kailly. “I have my Canadian Freightways team focused on keeping all of our domestic and international customers satisfied and their shipments moving.”

Kailly says Canadian Freightways is operated independently from its parent company and there will be no interruptions in service north of the border.

Consolidated Freightways is the third largest less-than-truckload company in the U.S., with nearly 20,000 employees. A recorded message to the company’s employees stated “All U.S. terminals will not be open tomorrow morning and you should not report, since your employment ends immediately. I am sorry for this action but we have no other choice due to a lack of financial resources.”

The message was recorded by Consolidated Freightways chief executive officer, John Brincko on Labor Day. The company has been staving off bankruptcy for some time now, with the economic slowdown resulting from the events of Sept. 11 being one of the final nails in the coffin.

“This is a very sad turn of events for all of us, but try as we did, we simply could find no other viable option,” Brincko said. “We have been vigorously exploring ways to restore the financial health of the company for some time now.”

About 14,500 Consolidated Freightways employees belong to the Teamsters union. Teamsters spokesman, Brett Caldwell, says the company informed the union all of its members will be laid off. Caldwell adds most employees were expecting the eventual bankruptcy of Consolidated Freightways, but the announcement came more suddenly than expected.

“Our freight division talked to the company as far back as a year ago when we saw some real issues,” says Caldwell. Consolidated Freightways operated about 30,000 trucks in North America. n