Trucking company Yellow Corp. has declared bankruptcy after years of financial struggles and growing debt, marking a significant shift for the U.S. transportation industry and shippers nationwide.
The Chapter 11 bankruptcy, which was filed Sunday, comes just three years after Yellow received $700 million in pandemic-era loans from the federal government. While a Chapter 11 filing is used to restructure debt while operations continue, Yellow, like other trucking companies in recent years, will liquidate and the U.S. will join other creditors unlikely to recover funds extended to the company.
"It is with profound disappointment that Yellow announces that it is closing after nearly 100 years in business," CEO Darren Hawkins said in a news release late Sunday. "For generations, Yellow provided hundreds of thousands of Americans with solid, good-paying jobs and fulfilling careers."Yellow, formerly known as YRC Worldwide Inc., is one of the nation's largest less-than-truckload carriers.
Those reports arrived just days after Yellow averted a strike from the Teamsters amid heated contract negotiations. A pension fund agreed to extend health benefits for workers at two Yellow Corp. operating companies, avoiding a planned walkout -- and giving Yellow "30 days to pay its bills," notably $50 million that Yellow failed to pay the Central States Health and Welfare Fund on July 15.
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.
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