Congressional Push to Rescue: Pressure is mounting from both sides of the aisle in Congress for the U.S. Treasury to intervene and save trucking giant Yellow from the brink of bankruptcy. Letters from Republican and Democratic lawmakers have flooded the Treasury, with the latest one coming from Republican Senator Josh Hawley, calling for an extension of a contentious $700 billion pandemic loan originally granted by the Trump administration.
This bipartisan chorus of support for Treasury action could work in favour of Jack Cooper, one of the largest privately-owned auto transport companies in the U.S. Jack Cooper is making a determined effort to rescue Yellow from looming bankruptcy, and a key component of their strategy involves convincing the Treasury to extend the loan’s current terms, which are set to expire in September 2024, to the more favourable time frame of 2026.
As Senator Hawley aptly put it, modifying the repayment terms is a practical step that could attract a buyer committed to maintaining Yellow as a viable player in the trucking sector, rather than letting it dissolve. This move, therefore, becomes a common-sense approach to keep Yellow’s fleet on the road and its workforce gainfully employed.
Also Read: Rescuing Yellow Corp: A Last-Ditch Bid to Save 30,000 Jobs
Yellow, formerly known as YRC, is a major player in the less-than-truckload carrier sector in the U.S., boasting renowned customers like Walmart and Home Depot. The Biden administration is actively seeking ways to enable Yellow to continue its operations, spurred on by the concerns of the International Brotherhood of Teamsters union, which has already seen significant job losses.
Yellow’s assets, which include a substantial fleet of 12,000 trucks and 35,000 trailers, are a critical part of the American logistics landscape. Nevertheless, the company laid off 22,000 union drivers and is preparing to sell its trucks and real estate separately.
According to Yellow’s bankruptcy filing, it reported $2.15 billion in assets and $2.59 billion in debt. As the bankruptcy proceedings continue, a final decision from the Treasury regarding the loan extension is anticipated this month, just as the company potentially heads for the sale of its assets. The fate of Yellow, along with the livelihoods of its employees, remains precariously balanced on this decision.
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