Yellow handled an average of 49,000 shipments per day in 2022 according to Satish Jindel, president of transportation and logistics firm SJ Consulting. “At this point, after each party has bailed them out so many times, there is a limited appetite to do that anymore.”Īn investors note from financial service firm Stephens last week estimated that Yellow was burning daily amounts of $9 million to $10 million in recent days. The prospect of bankruptcy and current financial chaos at Yellow “is probably two decades in the making,” said Stifel research director Bruce Chan, pointing to poor management and strategic decisions dating back to the early 2000s.
As of June 30, Yellow had paid $67 million in cash interest on the loan, which is due in 2024, the company said. The Teamsters supported the $700 million loan when it was first announced. Last month, a congressional probe concluded that the Treasury and Defense departments “made missteps” in this decision - and noted that Yellow’s “precarious financial position at the time of the loan, and continued struggles, expose taxpayers to a significant risk of loss.” In 2020, under the Trump administration, the Treasury Department granted the company a $700 million pandemic-era loan on national security grounds. Of that, $729.2 million was owed to the federal government. As of late March, Yellow had an outstanding debt of about $1.5 billion. Yellow has racked up hefty bills over the years.
#AUG 31ST TRUCKER STRIKE PLUS#
A Yellow spokesperson said Tuesday that the company previously request a short-term deferral of the pension contributions plus interest, but the funds denied that request. The union said Yellow would have “30 days to pay its bills,” notably a total of $50 million owed to the Central States Health and Welfare Fund. operating companies, avoiding a planned walkout. On July 23, a pension fund agreed to extend health benefits for workers at two Yellow Corp. These reports arrived just days after Yellow averted a strike from the Teamsters. And the company reportedly stopped freight pickups earlier in the week. Reports of Yellow preparing for bankruptcy emerged last week - as the Nashville, Tennessee-based trucker saw customers leave in large numbers, per The Wall Street Journal and FreightWaves.
Yellow offered to pay its employees more, a lot more, but the (Teamsters) refused to negotiate for nine months,” a company official said in a statement sent to The Associated Press Monday night, accusing the union of trying to “destroy” Yellow.
“Yellow has not asked its union employees for any concessions in its efforts to approve its long-planned modernization effort. At the time, the Teamsters called the litigation “baseless” - with O’Brien pointing to Yellow’s “decades of gross mismanagement” and accusing the company of wanting workers to “to foot the bill” amid the company’s financial chaos. When reached by The Associated Press, Yellow did not comment directly to the bankruptcy reports, but addressed contract negotiations between the Teamsters and the company, which sued the union in June after alleging it was “unjustifiably blocking” restructuring plans needed for Yellow’s survival. But the company was in financial trouble long before that - with industry analysts pointing to poor management and strategic decisions dating back decades.
The company’s collapse arrives just three years after Yellow, formerly known as YRC Worldwide Inc., received $700 million in pandemic-era loans from the federal government.
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