New Delhi:- It was the end of one of the nation's largest freight carriers. According to the union Teamsters, which represents 22,000 workers in the business, Yellow, a trucking company that just three years ago took out a $700 million federal loan in response to the pandemic, is about to close.
The company will file for bankruptcy as soon as Monday, following a recent exodus of customers amid a union dispute and years of financial troubles, industry experts said. With 30,000 jobs at stake, it's the largest trucking bust in US history, experts say. The company, formerly known as YRC Worldwide, is the third largest LTL carrier by revenue, behind FedEx and Old Dominion. LTL companies transport pallet-sized shipments – smaller than a container but larger than a parcel.
Yellow has not publicly announced any bankruptcy plans or possible closures. The Teamsters union, which is embroiled in controversial negotiations over a new contract with Yellow, said it received legal notice that Yellow ceased operations and filed for bankruptcy, according to a press release. on Sunday night.
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“Today's news is unfortunate but not surprising,” said Teamsters President Sean O'Brien. "This is a sad day for American workers and the freight industry." The union's announcement came hours after The Wall Street Journal reported that Yellow was closed Sunday afternoon, citing internal notices sent to customers and employees. Yellow said it would issue a public statement on Monday on its "state of business and operations," according to industry carrier FreightWaves, which also obtained internal documents.
Yellow did not respond to NPR's request for comment. As reported by FreightWaves, Yellow laid off an unspecified number of employees on Friday, citing a memo sent to employees announcing that the company is "closing regular operations" and " lay off employees at all company locations."
On the same day, Teamsters advised Yellow employees to "prepare for the worst." "Yellow looks like it's about to shut down completely over the next few days," John Murphy, national freight manager for Teamsters, said in a memo shared Friday with NPR.
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The closure comes just days after a Teamsters strike at the company was averted. A week ago, a pension fund agreed to extend health benefits to workers at two yellow-operated companies after it missed a $50 million payment to the fund on July 15. said the group. When the extension delayed the strike on July 24, the threat of a strike that could disrupt operations sent a wave of yellow customers fleeing.
Mike Regan, co-founder of TranzAct Technologies, which manages transportation services for retailers, writes: "Teamsters' actions have caused a high degree of change and uncertainty in the market for our customers. Yellow. The market abhors change and uncertainty." "As a result, the yellow color lost significant and much-needed volume."
Jack Atkins, chief executive officer of financial services firm Stephens, which researches the shipping industry, said that following the strike threat, Yellow's freight volumes plummeted 80% within a week. At the same time, he said, Yellow's exclamation that he was running out of money in union bargaining efforts scared off customers. After switching to competing carriers such as FedEx and ABF Freight, customers did not return.
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"Both sides are responsible," Atkins said. “Once that commodity leaves, there is nothing left to really restructure,” he added. "It's really too late to save the company." Animosity between Yellow and Teamsters has grown in recent months, as each side blames the other for the company's problems.
After the auto carrier attempted to restructure its operations this spring as a cost-saving measure that would allow it to refinance its debt. In June, Yellow continued.
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The Trucking Company Yellow who took a loan of 700 Million Dollars is now shutting down due to its Bankruptcy that fined today. The company has put on hold a lists of jobs of 30,000 workers and is also called the biggest bankruptcy in the history of trucking industry till now in United States by the official experts.