NEW YORK — Troubled trucking firm Yellow Corp. is shutting down and headed for a chapter, the Teamsters mentioned Monday.
An official chapter submitting is anticipated any day for Yellow, after years of monetary struggles and rising debt. Its anticipated liquidation would mark a major shift for the U.S. transportation trade and shippers nationwide.
“Today’s news is unfortunate but not surprising. Yellow has historically proven that it could not manage itself despite billions of dollars in worker concessions and hundreds of millions in bailout funding from the federal government,” Teamsters General President Sean M. O’Brien mentioned, in an announcement saying the union had been served with authorized discover for the chapter submitting. “This is a sad day for workers and the American freight industry.”
Yellow didn’t have a remark when reached by The Associated Press Monday. As of Monday afternoon, no chapter filings from the corporate may very well be discovered on the Securities and Exchange Commission’s web site.
The firm’s collapse arrives simply three years after Yellow, previously often called YRC Worldwide Inc., obtained $700 million in pandemic-era loans from the federal authorities. But the corporate was in monetary bother lengthy earlier than that — with trade analysts pointing to poor administration and strategic choices courting again many years.
Former Yellow prospects and shippers will face increased costs as they take their enterprise to opponents, together with FedEx or ABF Freight, consultants say — noting that Yellow traditionally provided the most cost effective value factors within the trade.
Yellow is likely one of the nation’s largest less-than-truckload carriers. The closure of the 99-year-old Nashville, Tennessee-based firm dangers a lack of 30,000 jobs.
Safety vests that appeared to belong to former Yellow staff have been zip-tied to the fence of a closed YRC Freight terminal in St. Louis, Missouri on Monday. Names and years labored on the firm have been written on them.
“Ron Fisher 2017-2023 was here,” one vest learn.
Reports of Yellow making ready for chapter emerged final week — because the Nashville, Tennessee-based trucker noticed prospects depart in giant numbers, per The Wall Street Journal and FreightWaves. And the corporate reportedly stopped freight pickups earlier within the week.
Yellow shut down operations on Sunday, based on The Journal, following the layoffs of tons of of nonunion staff on Friday.
In 2020, underneath the Trump administration, the Treasury Department granted the corporate a $700 million pandemic-era mortgage on nationwide safety grounds. Last month, a congressional probe concluded that the Treasury and Defense departments “made missteps” on this determination — and famous that Yellow’s “precarious financial position at the time of the loan, and continued struggles, expose taxpayers to a significant risk of loss.”
Yellow has racked up hefty payments over time. As of late March, Yellow had an excellent debt of about $1.5 billion. Of that, $729.2 million was owed to the federal authorities.
Source: www.bostonherald.com”