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"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," Teamsters union
said on Sunday.
Yellow is the third-biggest U.S. trucking company specializing
in the less-than-truckload segment that combines shipments from
different customers in the same trailer.
Its customers include large retailers like Walmart and Home
Depot, manufacturers and Uber Freight, some of which have paused
cargo shipments to the company for fear those goods could be
lost or stranded if the carrier goes bankrupt.
Competitors, who are grappling with a sharp drop in freight
volume, are expected to cherry-pick the company's customers,
trucking experts and analysts said.
In 2020, then-U.S. President Donald Trump bailed out the company
with a $700 million pandemic relief loan. In exchange, the
federal government took a 30% stake in Yellow.
The Nashville, Tennessee-based company formerly called YRC
Worldwide has not significantly repaid that loan, which is part
of $1.2 billion in debt it is scrambling to refinance before it
comes due next year. Yellow's other lenders include a group led
by Apollo Global Management.
Company executives appealed to the International Brotherhood of
Teamsters for help slashing expenses as cash dwindles. It has
successfully won such concessions in the past, but this time was
rebuffed by new Teamsters General President Sean O'Brien.
"Following years of worker give backs, federal loans, and other
bail outs, this deadbeat company has only itself to blame for
being in this embarrassing position," O'Brien said in a
statement last week.
O’Brien is also leading negotiations covering roughly 340,000
U.S. employees at United Parcel Service.
A federal judge in Kansas on Friday rejected Yellow's request to
block the Teamsters from striking over the delinquent benefit
payments.
(Reporting by Lisa Baertlein in Los Angeles and Ananta Agarwal
and Mrinmay Dey in Bengaluru; editing by Diane Craft and Chris
Reese)
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