NEW YORK — Troubled trucking company Yellow Corp. is shutting down and headed for a bankruptcy, the Teamsters said Monday.
An official bankruptcy filing is expected any day for Yellow, after years of financial struggles and growing debt. Its expected liquidation would mark a significant shift for the U.S. transportation industry 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 said, in an announcement saying the union had been served with legal notice for the bankruptcy filing. “This is a sad day for workers and the American freight industry.”
Yellow did not have a comment when reached by The Associated Press Monday. As of Monday afternoon, no bankruptcy filings from the company could be found on the Securities and Exchange Commission’s website.
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. But the company was in financial trouble long before that — with industry analysts pointing to poor management and strategic decisions dating back decades.
Former Yellow customers and shippers will face higher prices as they take their business to competitors, including FedEx or ABF Freight, experts say — noting that Yellow historically offered the cheapest price points in the industry.
Yellow is one of the nation’s largest less-than-truckload carriers. The closure of the 99-year-old Nashville, Tennessee-based company risks a loss of 30,000 jobs.
Safety vests that appeared to belong to former Yellow workers were zip-tied to the fence of a closed YRC Freight terminal in St. Louis, Missouri on Monday. Names and years worked at the company were written on them.
“Ron Fisher 2017-2023 was here,” one vest read.
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. And the company reportedly stopped freight pickups earlier in the week.
Yellow shut down operations on Sunday, according to The Journal, following the layoffs of hundreds of nonunion employees on Friday.
In 2020, under the Trump administration, the Treasury Department granted the company a $700 million pandemic-era loan on national security grounds. 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.”
Yellow has racked up hefty bills over the years. As of late March, Yellow had an outstanding debt of about $1.5 billion. Of that, $729.2 million was owed to the federal government.