Yellow Corp., a renowned trucking company with a rich 99-year history, has suspended all operations, resulting in the devastating layoff of its entire workforce comprising 30,000 employees.
The company, which had a unionized structure, had been embroiled in a conflict with the Teamsters union representing about 22,000 drivers and dock workers. Last week, the union had threatened a strike due to the company’s failure to contribute to its pension and health insurance plans. While the union granted an additional month for payment, Yellow ceased freight pickups from customers and focused solely on delivering existing freight.
Despite avoiding a strike, the union couldn’t reach an agreement on a new contract with the trucking company. On Monday, the union was notified of the shutdown.
The closure of Yellow Corp. is a significant blow, not only for its workforce and clients, who appreciated the company’s competitive rates, but also for the US taxpayers. In 2020, the company received a $700 million loan from the federal government, leading to taxpayers holding 30% of its outstanding stock. The company still owed the Treasury department over $700 million, which constitutes almost half of its long-term debt.
Experts believe that the company’s excessive debt, amassed over the past two decades during its acquisition of other trucking firms, played a major role in its downfall. This financial burden eventually became unsustainable for Yellow.
While the trucking industry has seen a shift in consumer spending from goods to services, the closure of Yellow is not expected to significantly disrupt supply chains. However, it will likely lead to higher shipping rates for customers who relied on Yellow’s economical services.
The demise of Yellow Corp. marks the end of an era in the trucking industry. Once a dominant player among the unionized carriers, Yellow now joins the list of the Big Three trucking companies, including Roadway Express and Consolidated Freightways, that have all exited the business.
https://weeklyvoice.com/trucking-giant-yellow-closes-after-99-years-leaving-30000-jobless/ Trucking Giant Yellow Closes After 99 Years, Leaving 30,000 Jobless