Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

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

cnn.com

Post reply on HN
Print view View original

111–120 of 143 posts

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

#111

Post by chefandy »

bko wrote: post #100
chefandy wrote: post #94

Earlier quoted context omitted.

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

Or exactly why they shouldn't take on a ton of debt acquiring companies when it's not beneficial?

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

#112

Post by zone411 »

dymk wrote: post #91
qeternity wrote: post #63

Earlier quoted context omitted.

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.

UPS is not a comparable company.

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

#113

Post by dehrmann »

mech765 wrote: post #97
dehrmann wrote: post #95

Earlier quoted context omitted.

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.

Then pay them significantly more than they can get at their next job.

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

#114

Post by zdragnar »

jl6 wrote: post #69
nickff wrote: post #66

Earlier quoted context omitted.

The market for truckload and LTL shipping is currently very thin, and they'd likely lose more revenue than they'd make.

Maybe, but at least a couple of quarters of demonstrable uncompetitiveness would be solid evidence to take to the negotiating table with the unions to get the labor cost down (if that really was the primary cost problem).

They shut down because they lost customers after the union threatened to strike. The hit to their stock price, even after the union withdrew the threat, meant they couldn't get more funds to continue operations.

Perhaps they could have raised prices earlier and gone out of business faster, but it's pretty clear that the writing was on the wall for Yellow for quite awhile.

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

#115

Post by nickff »

jl6 wrote: post #107
nickff wrote: post #88

Earlier quoted context omitted.

Labor unions which have members at multiple companies in one sector are often reluctant to make concessions at any one company, lest it erode their bargaining positions at the others.

Yeah, I guess, it just seems crazy that all 30,000 people losing their jobs could be a tolerable outcome for the employees.

I don't think it is a tolerable outcome for the employees; perhaps they were hoping for another bailout? We should also remember that unions suffer the principal agent problem just as badly (and perhaps worse) than corporations and governments.

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

#116

Post by zdragnar »

atourgates wrote: post #27
no_wizard wrote: post #14

Earlier quoted context omitted.

From the sounds of it, its mostly the bad loans + poor management part that killed Yellow. Management of the company have been asleep at the wheel for some time now, union demands are not likely the precipitating factor here. EDIT: All I'm pointing out here is that I don't think this can land squarely on union demands, which is what I think some of the press are making it out to be. The actual financial mismanagement…

It doesn't seem like the "union demands" killed the company narrative tracks here, since the union demands were things like "You should actually make the contributions to our retirement accounts that you're obligated to make."

The threat of a strike was the final blow, causing them to lose customers and dropped their stock price such that they didn't have anything to borrow with.

All of the bad decisions they'd previously made out them in this position, but the union threatening to strike was the straw that broke their back- despite the union withdrawing the threat.

That last tidbit probably tells you all you need to know about how little chance the company had at surviving.

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

#117

Post by exabrial »

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

I think if you join a Union and demand unreasonable benefits for the skill required for a profession, then you’re responsible for the company’s collapse too.

I don’t think I could drive a big rig, it is a skilled labor profession; so what I’m not saying is ‘anyone could do that job’, but it is a job that can be trained for in a shorter amount of time than say an xray tech in a hospital.

What blows my mind is Unions in the USA often bite hard on the hand that feeds them, when it doesn’t need to be this way. The Union should work with the board to improve profits. Why there isn’ta symbiotic relationship is so strange.

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

#118

Post by nlh »

dkulchenko wrote: post #41
dymk wrote: post #12

The company was an unmitigated shitshow for a long time, and didn't perform its basic duties as a shipper. I've had LTL shipments lost for weeks at a time with nothing but a shrug and an "It'll (maybe) get there when it gets there". So it doesn't surprise me at all that they couldn't reach an agreement with their labor.

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 amazing to me that in 2023 when the small-package industry (USPS, UPS, FedEx) is SO SO SO highly optimized that I have a choice of 3 carriers to get a box across the country in 1-2 days and by and large it works pretty darn well, and yet if a company wants to ship a pallet the same place, the logistics fall apart into garbage "it'll get there when it gets there."

I know FedEx and UPS offer freight services, but it doesn't sound like they're dominant or close to it in the industry. Why didn't they put Yellow and the likes in the ground years ago?

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

#119

Post by antisthenes »

Just another reminder that capital's eventual state is consolidation in the hands of monopolies.

When companies of this size fail, the consolidation happens at breakneck pace that the legal system of the US obviously cannot keep up with, and we all end up losing, because of reduced competition and worse service as a result.

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

#120

Post by antisthenes »

pierat wrote: post #64

And this is a perfect time to talk about worker owned corporations. The employees should be able to buy the company. Not only that, but they should also be given first rights to do that. And if government was serious about keeping businesses in operation through bankruptices, they would also issue a loan to the employees to complete this. That would keep the company running, under employee control, and save a whole p…

Worker owned corporations don't work for the same reason communism doesn't work.

"Bad" actors (in this case people who are bad with money) will simply sell their share of the company for short term household needs, which will begin the process of consolidating company ownership in the hands of more frugal/savvy owners.

Then in the end you simply end up with the same ownership distribution as it exists today.

Post reply on HN