Coach USA, a Paramus-based transportation company, filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the District of Delaware June 11. 

On its website, the company said it has initiated court-supervised sales for its businesses. Coach added the move aims to “preserve jobs, ensure continued service and maximize the value of our businesses.” The company has 2,700 employees throughout the U.S. and Canada. 

“Following the COVID-19 pandemic, the company faced significant challenges, as ridership and demand in our industry have remained well below pre-pandemic levels,” the company added on its site. According to Reuters, Coach reported bus ridership dropped 90% from 2019-2020. In 2023, the figure was only 45% of pre-pandemic levels. 

Variant Equity acquired the company for approximately $271.4 million in April 2019.

As part of the court-supervised sale processes: 

• The Renco Group Inc., Bus Company Holdings US LLC, agreed to purchase some of Coach’s bus lines, including Dillon’s, Elko, Megabus Retail, Montreal, Olympia, Trentway/Ontario (including Megabus Canada), Perfect Body, Rockland, Shortline (including Chenango Valley Bus Lines), Suburban, Van Galder and Wisconsin Coach, as well as certain assets of Community Coach and the Megabus intellectual property and retail operations.  
• Affiliates of AVALON Transportation LLC agreed to buy Lenzner, Kerrville, All West and ACL Atlanta bus lines.

Coach said it continues to pursue sales of its remaining business segments and assets. BCH US and Avalon serve as the stalking horse bidders for the businesses. However, if other qualified bids are submitted, Coach will conduct auctions with the stalking horse bidders setting the floors for the processes. 

Coach emphasized the “company is operating as normal and remains focused on operating safely and serving customers in the United States and Canada.” 

“As we move through this process, our top priority remains safely carrying the millions of passengers who choose our buses each year and working closely with our valued contract customers and transportation agency partners,” Coach USA CEO Derrick Waters said in a statement. “We appreciate the dedication of our employees to operating with safety as a priority and serving our customers and our communities.” 

Additional funding and motions 

Coach USA also received a commitment for debtor-in-possession financing that includes $20 million to support the business during bankruptcy proceedings. 

Additionally, the company filed customary motions with the court, including authority to pay wages and employee benefits. Coach said it intends to pay vendors and suppliers in full under normal terms for goods and services provided on or after the filing date. 

The COVID effect

According to the American Bus Association, the pandemic’s effect “on the motorcoach, group travel and tourism industry has been astounding. The entire industry has been decimated unlike any time before as cities and states shut down to travel and Americans are fearful of traveling in groups.” 

In April 2023, DeCamp Bus Lines, the oldest bus service in New Jersey, suspended service to and from Manhattan. At the time, that company also cited the effects of the pandemic.