26.2 C
New York

After 100 years in operation, bankruptcy looms for Yellow as customers flee, stock plunges: Reports

Published:

The trucking industry is bracing for news from Yellow Corp. amid multiple reports that the company is preparing to file for bankruptcy.

On July 27, the Wall Street Journal reported that Nashville, Tennessee-based Yellow is preparing to file for bankruptcy amid ongoing negotiations with the Teamsters and cash flow woes. The report also stated that Yellow is losing customers and that a bankruptcy announcement could happen as early as this week.

Yellow’s stock is down 50% to fifty cents a share as of Thursday morning.

A separate report from CNN says that Yellow has stopped picking up freight but is still delivering freight within the company’s system.

However, the company says that they are still working to negotiate with the union and no final decisions have been made.

On Wednesday, a company official told CDLLife that “Talks with the International Brotherhood of Teamsters are ongoing. As previously stated, in keeping with the fiduciary responsibility of the company’s executives, the company continues to prepare for a range of contingencies.”

On July 23, the Teamsters announced that Yellow had averted a looming strike by making an agreement with the Central States Pension Fund that afforded the company a 30 day grace period after the company withheld pension and healthcare payments totaling $50 million on July 15.

“Agreement by the Central States at the urging of the Teamsters gives Yellow 30 days to pay its bills with the understanding the company will do so within the next two weeks,” the Teamsters said.

Yellow employs around 30,000 workers and is the third largest LTL carrier in the U.S.

For more on the ongoing conflict between Yellow and the Teamsters, please click here.

Yellow Transit Freight Lines, the company that would become Yellow, was established in 1924 in Oklahoma City by brothers Cleve and A.J. Harrell.

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