One of the nation’s largest shippers of goods is planning massive layoffs with bankruptcy reportedly on the immediate horizon.
Yellow, a company that received a $700 million federal pandemic loan just three years ago, is shuttering its business, according to the Teamsters union.
The Teamsters represent 22,000 unionized Yellow employees.
The bankruptcy filing was expected to be made official as early as Monday, according to analysts, who say financial difficulties spanning multiple years have combined with disgruntled union workers and a big dip in business to help tank the trucking company.
Formerly known as YRC Worldwide, Yellow specialized in less-than-truckload shipments – that is, pallet-sized deliveries that are considered larger than a parcel but smaller than a container. Yellow was the third-largest company dealing in shipments this size, behind only FedEx and Old Dominion.
While industry analysts and the Teamsters all say that bankruptcy is imminent, the company itself has yet to comment publicly on the issue or on what their plan following such a filing might entail.
“Today’s news is unfortunate but not surprising,” Teamsters General President Sean O'Brien wrote in a news release Sunday night after the union received a legal about Yellow’s cease of operations. "This is a sad day for workers and the American freight industry.”
FreightWaves also reported that Yellow had begun laying off employees on Friday and that a letter was sent informing them that the company would be “shutting down its regular operations” and “laying off employees at all of its locations.”
So what does it mean for consumers?
"This is not going to create a supply-chain crisis," Jack Atkins of the financial firm Stephens told NPR, who added that there isn’t expected to be a federal bailout and that Yellow’s competitors should be able to handle the additional business that comes from the company’s demise.
Related
