Teamsters: US trucking firm Yellow notifies it of shutdown, bankruptcy

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Teamsters: US trucking firm Yellow notifies it of shutdown, bankruptcy
Yellow has notified the Teamsters that is has shut down and is filing for bankruptcy. (Courtesy: Yellow)

WASHINGTON — The Teamsters said on Sunday, July 30, that the union was served a notice that Yellow Corp is ceasing operations and filing for bankruptcy, leaving 30,000 workers in limbo.

“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 a statement.

Earlier in the day, the Wall Street Journal reported about the closure of the trucking firm’s operations which cited notices sent to customers and employees. Last week, WSJ also reported that the company has laid off a large number of workers.

Earlier this month Yellow averted a threatened strike by 22,000 Teamsters-represented workers, saying the company will pay the more than $50 million it owed in worker benefits and pension accruals.

The company said on Thursday it is exploring opportunities to divest its third party logistics company Yellow Logistics Inc, and is engaged with multiple interested parties.

Its customers include large retailers like Walmart and Home Depot, manufacturers and Uber Freight, some of which have paused cargo shipments to the company for fear those goods could be lost or stranded if the carrier went bankrupt.

In 2020, the Donald Trump-led government rescued the company with a $700 million pandemic relief loan in exchange for a 30% stake.

Yellow did not immediately respond to a request for comment.


According to Satish Jindel, president of transportation and logistics firm SJ Consulting, Yellow handled an average of 49,000 shipments per day in 2022. Last week, he estimated that number was down to between 10,000 and 15,000 daily shipments.

With customers leaving — as well reports of Yellow stopping freight pickups last week — bankruptcy would “be the end of Yellow,” Jindel told The Associated Press, noting increased risk for liquidation.

“The likelihood of them surviving and remaining solvent diminishes really by the day,” added Bruce Chan, a research director at investment banking firm Stifel.

Yellow declined to comment when contacted by The Associated Press on Friday. In a Wednesday statement to The Journal, the company said it was continuing “to prepare for a range of contingencies.” On Thursday, Yellow said it was in talks with multiple parties about selling its third-party logistics organization.

Even if Yellow was able to sell its logistics firm, it would “not generate a sufficient amount of cash to keep them operational on any sort of permanent basis,” Chan said. “Without a major equity injection, it would be very difficult for them to survive.”


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.

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.”

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The government loan is due in September 2024. As of March, Yellow had made $54.8 million in interest payments and repaid just $230 million of the principal owed, according to government documents.

Yellow’s current finances and prospect of bankruptcy “is probably two decades in the making,” Chan said, pointing to poor management and strategic decisions dating back to the early 2000s. “At this point, after each party has bailed them out so many times, there is a limited appetite to do that anymore.”

In May, Yellow reported a loss of $54.6 million, a decline of $1.06 per share, for its first quarter of 2023. Operating revenue was about $1.16 billion in the period.

A Wednesday investors note from financial service firm Stephens estimated that Yellow could be burning between $9 million and $10 million each day. Using a liquidity disclosure from earlier this month, Yellow had roughly $100 million in cash at the end of June, the note added — estimating that the company has been burning through increasing amounts of money through July.

“It is reasonable to believe that the Company could breach its $35 mil. liquidity requirement at any moment,” Stephens analyst Jack Atkins and associate Grant Smith wrote.

The Associated Press and The Trucker Staff contributed to this report.

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The teamsters are seriously blaming yellow’s management? Lol I can’t figure out UPS. a $7.50/hr pay raise and PT going from $15 to $21? UPS must be planning to hire only part time. I know they have lost a lot of Amazon packages. Mine are exclusively brought to me by the post office. So where they see growth coming from I have no idea.

Bottomline? Teamsters and unions in general eventually kill everything they touch. Much like liberals.

Yellow is finished and so are thousands of owner operators today. They will not survive in this market. That will be followed by a banking crisis as all these truck and trailer loans go into default. And with the used market flooded who will buy?

By design. The climate agenda will destroy the economy. A strong economy means more carbon emissions. They don’t want that.