99-year old trucking company Yellow shuts down, putting 30k out of work • Hacker News Board

Re: 99-year old trucking company Yellow shuts down, putting 30k out of work

#91

Post by dymk » Mon, Jul 31, 2023, 4:31 PM UTC

qeternity wrote: post #63

dkulchenko wrote: post #41

Earlier quoted context omitted.

This mirrors my experience. Not once did I have a Yellow LTL shipment arrive on time, and typical delays ranged from 2 days to 2 weeks or longer. Shipments would get lost in a terminal, down to staff insisting it never arrived on the trailer, and then spontaneously reappear after a loss claim was filed. I would've loved to avoid them but vendors would often choose them due to their cost.

It's very difficult to implement radical change in an organization when unions prevent you from firing low performers w/o exorbitant costs. You see this across the public sector where it's practically impossible to get fired unless you do something egregious. Lots of union defenders here ignoring that unions make reform impossible.

The problem isn't the unions. If you've interacted with Yellow you'd know that. It's that the company is disorganized and management is nowhere to be found.

Look at UPS - union shop, going strong. Management is organized. Company is doing fine.

Re: 99-year old trucking company Yellow shuts down, putting 30k out of work

#92

Post by SoftTalker » Mon, Jul 31, 2023, 4:32 PM UTC

LazyMans wrote: post #68

SoftTalker wrote: post #52

Earlier quoted context omitted.

I would presume they paid the least they were legally obligated to pay, as any normal person or company would do. Trucks also pay a lot of road use taxes. Some would say not enough, but trucking is not a low-taxed line of business.

It would be interesting to see the net benefit a company had. Obviously putting money in employee pockets is a net benefit, but it stops being so great if tax dollars are just subsidizing bad business leading to a net drain on tax payers

"tax dollars are just subsidizing bad business" is the definition of most bailouts.

Re: 99-year old trucking company Yellow shuts down, putting 30k out of work

#93

Post by Buttons840 » Mon, Jul 31, 2023, 4:32 PM UTC

Silverback_VII wrote: post #80

Buttons840 wrote: post #56

Earlier quoted context omitted.

Why are industries dominated by large unprofitable companies? I was told the way to succeed was to offer goods and services that people want, make a profit and grow the company; this was a key benefit of the free market and ensured consumers had access to many good choices and it was all stable and sustainable. Instead unprofitable companies dominate, not because they succeeded in the market, but because they receive…

>Why are industries dominated by large unprofitable companies? The logic is quite simple: by undercutting your competition, you aim to quickly drive others out of business and secure a monopoly. Once in such a position, making a profit becomes much easier.

Every time I think about this I keep coming back to anti-trust enforcement, we need more of it. And perhaps a single entity having enough money to essentially buy an entire industry isn't a good thing.

Re: 99-year old trucking company Yellow shuts down, putting 30k out of work

#94

Post by chefandy » Mon, Jul 31, 2023, 4:34 PM UTC

bko wrote: post #73

EMM_386 wrote: post #22

"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…

> People will blame unions because the company had to fund pensions and health insurance. It likely will come back as a private company with lower pay, worse benefits, and maybe if people are lucky a 401k. You can never compete if you have a pension liability from workers no longer there. A competitor can always come in without that liability and out compete you. It's not good for the business or the employees who wi…

From the article:

"Experts in the field said it was primarily an unaffordable amount of debt, more than the cost of the union contract, that did in Yellow.

'The Teamsters had made a series of painful concessions that brought them close to wage parity with nonunion carriers,' said Tom Nightingale, CEO of AFS Logistics, a third-party logistics firm that places about $11 billion worth of freight annually with different trucking companies on behalf of shippers. He said the company began taking on significant amount of debt 20 years ago in order to acquire other trucking companies."

Sounds like it was just bad business strategy.

Re: 99-year old trucking company Yellow shuts down, putting 30k out of work

#95

Post by dehrmann » Mon, Jul 31, 2023, 4:35 PM UTC

gottorf wrote: post #46

EMM_386 wrote: post #22

"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…

Pensions seem like an outdated concept, when 401Ks and IRAs are options. Pensions are essentially a tradeoff of lower pay now in exchange for benefits in the future, with a sprinkle of an incentive for increased retention added in, but with the critical downside (to the employer) of it basically being an unbounded, undefined financial downside for them at the tail end. Employers should pay people, contribute to their…

Regardless of how you feel about pensions, tying them to the employer is silly because it limits employee mobility and is a liability most businesses don't want to deal with. What's ironic is the people promoting them tend to be the same as the ones promoting nationalized healthcare (or vice versa).

Re: 99-year old trucking company Yellow shuts down, putting 30k out of work

#96

Post by hibikir » Mon, Jul 31, 2023, 4:37 PM UTC

blitzar wrote: post #79

bko wrote: post #73

Earlier quoted context omitted.

> People will blame unions because the company had to fund pensions and health insurance. It likely will come back as a private company with lower pay, worse benefits, and maybe if people are lucky a 401k. You can never compete if you have a pension liability from workers no longer there. A competitor can always come in without that liability and out compete you. It's not good for the business or the employees who wi…

You can easily compete if you have a pension liability from workers no longer there by making provision for it at the time that the liability is created.

Can you? A defined benefit plan is ultimately involving someone taking a risk. One either makes the risk very small, and therefore being a very expensive benefit from the very beginning, or be aggressive, and risk being an underfunded benefit.

Either way you slice it, someone providing defined contributions instead is far safer, and can safely outcompete the defined benefit company, as they aren't taking on either side of the risk: The employee is.

Note that the costs of trucking are the same either way: Paying for the contribution later is precisely a way to be very competitive now, as the idea of a safe, defined pension that you self fund is much nicer until you see what it takes out of your paycheck.

Re: 99-year old trucking company Yellow shuts down, putting 30k out of work

#97

Post by mech765 » Mon, Jul 31, 2023, 4:38 PM UTC

dehrmann wrote: post #95

gottorf wrote: post #46

Earlier quoted context omitted.

Pensions seem like an outdated concept, when 401Ks and IRAs are options. Pensions are essentially a tradeoff of lower pay now in exchange for benefits in the future, with a sprinkle of an incentive for increased retention added in, but with the critical downside (to the employer) of it basically being an unbounded, undefined financial downside for them at the tail end. Employers should pay people, contribute to their…

Regardless of how you feel about pensions, tying them to the employer is silly because it limits employee mobility and is a liability most businesses don't want to deal with. What's ironic is the people promoting them tend to be the same as the ones promoting nationalized healthcare (or vice versa).

In some industries low worker mobility is very desirable for the company. Offering long time horizon benefits is a good way to reduce turnover. I would prefer my local nuclear plant operator to have employees that stick around and get to know the equipment very well.

Re: 99-year old trucking company Yellow shuts down, putting 30k out of work

#98

Post by bko » Mon, Jul 31, 2023, 4:39 PM UTC

blitzar wrote: post #79

bko wrote: post #73

Earlier quoted context omitted.

> People will blame unions because the company had to fund pensions and health insurance. It likely will come back as a private company with lower pay, worse benefits, and maybe if people are lucky a 401k. You can never compete if you have a pension liability from workers no longer there. A competitor can always come in without that liability and out compete you. It's not good for the business or the employees who wi…

You can easily compete if you have a pension liability from workers no longer there by making provision for it at the time that the liability is created.

You can't really provision a defined benefit 30 years from now. And i def wouldn't trust you to. Not only that you have to ensure that no one else comes along in the next thirty years and messes with it, or the company tanks or a million other things that could go wrong

If you provision it you might as well give me a 401k where I have discretion over the funds. Or give me money I can use for my own healthcare in the future.

The only people defined pension benefits is shady business managers that don't care and want to get away with cheaper labor costs at the expense of the future which he won't be around to see anyway

Re: 99-year old trucking company Yellow shuts down, putting 30k out of work

#99

Post by HenryBemis » Mon, Jul 31, 2023, 4:41 PM UTC

bastardoperator wrote: post #76

EMM_386 wrote: post #22

"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…

"Lo barato sale caro" which translates to the "the cheap becomes expensive". If you see something that is cheaper then everything else, just assume they're cutting corners in places that matter. It will be interesting to see how many millions of dollars they use to keep the executive team in place during the bankruptcy despite the fact it's their decisions that lead to failure. I also wonder how much student debt we…

> "Lo barato sale caro" which translates to the "the cheap becomes expensive"

99% true with some very few exceptions. I remember Evan Davis' on a BBC podcast called "The Bottom Line". In said podcast he was interviewing various business people.

One of them was the CEO of Primark.

Over 'here' (in Europe - in multiple countries) you can see MASSIVE stores (I haven't yet been on a Primark store that was smaller than a football pit (per floor - typically two floors - lower for women, upper for men and kids), and they have shockingly low prices. I haven't visited a Primark outside Europe yet, so I have no opinion about other regions.

So.. back to the CEO.. he was responding that their low prices is not because of low quality, but because they never spend a dime on marketing, and thus they can use these savings to improve quality and lower prices, and then went on to challenge the journalist to remember/find one (paid) advertisement.

At that point (5? 6? 7? years ago) I also tried and for the life of me I could not remember ever seeing ads on the Tube (London underground), newspapers, bus stops, internet (but I block 99.9% of them).. anywhere.

So yes, 99% true but then I have a black long-sleeve t-shirt Cedarwood (Primark product) that 5 years on is still in great shape and I do wear it a lot, while the respective H&M don't go past the 2 year mark.

Re: 99-year old trucking company Yellow shuts down, putting 30k out of work

#100

Post by bko » Mon, Jul 31, 2023, 4:44 PM UTC

chefandy wrote: post #94

bko wrote: post #73

Earlier quoted context omitted.

> People will blame unions because the company had to fund pensions and health insurance. It likely will come back as a private company with lower pay, worse benefits, and maybe if people are lucky a 401k. You can never compete if you have a pension liability from workers no longer there. A competitor can always come in without that liability and out compete you. It's not good for the business or the employees who wi…

From the article: " Experts in the field said it was primarily an unaffordable amount of debt, more than the cost of the union contract, that did in Yellow. 'The Teamsters had made a series of painful concessions that brought them close to wage parity with nonunion carriers,' said Tom Nightingale, CEO of AFS Logistics, a third-party logistics firm that places about $11 billion worth of freight annually with different…

Exactly why you should be against defined benefit pensions and other policies unions often push that favor workers no longer there