Yellow Corp. has closed its doors and will lay off all 30,000 of its dock workers and drivers.
Known as one of the most inexpensive LTL (less than truckload) transportation companies in North America, the company had been struggling to make ends meet.
It had recently battled against the Teamsters union, which represented about 22,000 drivers and dock workers at Yellow Freight, as the company had stopped contributing to their pension and health insurance plans. The union had threatened a strike but canceled it one week ago, giving Yellow one month to make the payments.
But as of Wednesday last week, the company was no longer picking up freight from customers and was only making deliveries of items already in its system.
Teamsters President Sean O‘Brien said via a statement: "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. This is a sad day for workers and the American freight industry."
Yellow Freight had previously received a prop-up loan from the US government in 2020 of $700 million—even though it was being charged by the US Government for overbilling on shipments for the US military.
In 2022, Yellow handled about seven percent of America’s 720,000 daily LTL shipments.
Because there is currently excess capacity in LTL shipping, the closing of Yellow will not significantly affect the supply chain—except that customers will realize they will have to pay more, especially since it was obvious Yellow could not afford its low charges and be profitable.
It is also a blow to 30,000 dock workers and drivers. With a driver shortage, we can assume most will be able to find work.
For maintenance and repair companies, note that Yellow assets will be picked up by other parties.