Yellow Corp., the 3rd largest Less-Than-Truckload (LTL) carrier in the United States, filed for Chapter 11 Bankruptcy protection on Sunday, August 6th – a move that long seemed inevitable and one that shuts the doors on a company just short of its 100th anniversary. The collapse of Yellow, a company with USD$5.2 billion in revenue in 2022, is the largest company failure in trucking history.
The immediate impact will be felt throughout the North American trucking industry in various ways, including the tightening of LTL truck capacity, a rise in trucking costs and, in some cases, delays on pick-ups and/or deliveries.
The move takes nearly 12,000 trucks off the roads and temporarily eliminates 30,000 jobs, including 128 positions in Canada.
“Yellow accounted for 10% to 15% of the LTL market share. And its competitors have already indicated they will not be honouring Yellow’s pricing structure”, said Ken Adamo, the principal for global freight market intelligence at DAT Solutions, a freight and shipping analytics company. “If 10% of [LTL] volume is going up 20%, that’s material,” Adamo said, adding that some other trucking companies might also meet demand by slowing pickup schedules.
Yellow was always known as a low-cost, no frills type carrier and as we transition from the slower late summer freight market into a more demanding and robust fall season, clients will need to be on the lookout for new options that are capable of providing the needed service, without having to significantly alter their freight budgets.
For more information, contact William Sanchez, Manager – Truck Services.