The Teamsters announced Monday that trucking company Yellow Corp. is closing and filing for bankruptcy.
Official paperwork had not been filed as of Monday morning, but it is expected soon.
Yellow Corp. had about 30,000 employees across the U.S. earlier this year and is based in Nashville, Tennessee. About 22,000 employees are unionized and represented by the Teamsters, who have been negotiating with the company until a strike was averted earlier this month, The Associated Press reported.
Signs of the closure started appearing last week when The Wall Street Journal and FreightWaves reported that the trucking company had started bankruptcy preparations and some customers stopped using the shipping provider. Yellow Corp. was also said to have stopped freight pickups last week, the AP reported.
Walmart and Home Depot were among the company’s customers, Reuters reported.
It also laid off hundreds of nonunion employees on Friday and shut down its operations on Sunday, The Wall Street Journal reported.
Yellow has had financial woes as of late. The Treasury Department gave the company a $700 million pandemic-era loan, granted under the category of national security. However, lawmakers found that the Treasury and Defense departments “made missteps” in making the loan decision and that Yellow’s “precarious financial position at the time of the loan, and continued struggles, expose taxpayers to a significant risk of loss.”
The deadline to repay the loan is September 2024, but Yellow has only paid $54.8 million in interest payments and $230 million of the principal owed, the AP reported.
Yellow Corp. had been trying but failed to reorganize and refinance more than $1 billion of debt, Reuters reported.
“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, according to Reuters.
The AP and Reuters reached out to Yellow Corp. for comment but have not received a response.
The Wall Street Journal reported that the company sent out notices to customers and employees that it was stopping all operations at midday Sunday.
