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Let's take a second to recognize the ironic branding of Yellow corporation. It's orange. Nothing yellow about it. Some person or group of people made that decision.
So 30000 people lose their job and the US taxpayer is out more than $700 million in loan guarantees. The only question remaining is how much money do the owners of the company walk away with?
Not defending how our stuff is set up, but it would be interesting to know how much taxes Yellow paid over it's lifetime. Excluding taxes paid by employees.
Trucks also pay a lot of road use taxes. Some would say not enough, but trucking is not a low-taxed line of business.
Earlier quoted context omitted.
Sounds like Schroedinger's shipment. If we don't know where it is, can it really be lost?
Isn't that the definition of something being lost, i.e., not knowing where it is?
Where it is may be where it's supposed to be. Not knowing that doesn't make it lost.
Ex: If I send a ship to sea before we had radio/telegraph, I may not know where it is at any given point, but it's not lost and I don't need to go find it.
It's lost when it misses a check-in, and what constitutes a check-in is really company/org dependent.
Looks like all big enterprises have no option but to end up in bankruptcy court, given that they're too big to make drastic changes, have to deal with strong arming unions and only when it's too late things have to be decided in court
(same for other industries like Auto)
Earlier quoted context omitted.
The owner’s equity would be wiped out to zero. And 29.6% of the company is owned by the USA as part of that Covid era loan. The real story here is the non union shops eating Yellow and the other union shops lunch. Government loans just kept it alive to die a slower death.
Yes, government bailouts of private companies really need to stop. It just prolongs the problem and doesn't allow the market to properly respond to risks and rewards.
edited for clarity
"The closing is bad news not only for its employees and its customers, who generally used Yellow because it offered some of the cheapest rates in the trucking sector." Perhaps they shouldn't have offered the cheapest rates in the trucking sector while failing their obligations. Taxpayers ended up holding 30% of this company's stock and they still couldn't figure out how to become profitable after a $700 million infus…
This works in a vacuum, but in many industries you get undercharging and living off investments, be it Uber or a gajillion startups, many of them mentioned here on HN.
I'd like an economic system where the companies that offer the best goods and service at the right price grow and succeed. I've heard this is how capitalism is supposed to work, but more and more it seems the key to success is currying favor with the wealthy and capturing a market through external means.
"The closing is bad news not only for its employees and its customers, who generally used Yellow because it offered some of the cheapest rates in the trucking sector." Perhaps they shouldn't have offered the cheapest rates in the trucking sector while failing their obligations. Taxpayers ended up holding 30% of this company's stock and they still couldn't figure out how to become profitable after a $700 million infus…
Is that really surprising though? Getting a government buy-in like this generally happens after private sector investment falls through. If large swathes of the private sector didn't believe that the company would become profitable after infusion (they would have bought low and sold high if they did), why would public sector capital have any different outcome?
Let's take a second to recognize the ironic branding of Yellow corporation. It's orange. Nothing yellow about it. Some person or group of people made that decision.
> Higher prices will hit Yellow customers, Jindel said. > “The reason they were using Yellow was because they were cheap,” he said. “They’re finding out that price was below the cost of supporting a good operation.” What happened that made them decide to shut the company down instead of raising their prices?
I would presume it was because the union contract did not allow them to lay-off or furlough any workers, and they'd lose less money by being 'cheap' than by being more expensive and having workers sitting around. Put another way, their labor was probably their largest cost center, and a fixed cost, which means that their marginal cost to provide the service was actually low, but the company was unprofitable due to th…
So 30000 people lose their job and the US taxpayer is out more than $700 million in loan guarantees. The only question remaining is how much money do the owners of the company walk away with?
CEO was making close to $1M/yr for a few years.