Yellow Bankrupt? + UPS Strike

July 20, 2023


Yellow’s Pension Woes and UPS Strike Threat: Implications for the Supply Chain
The supply chain and transportation industries are facing significant challenges that could have far-reaching implications. Furthermore, two major developments to watch are Yellow’s pension payment issues and the threat of a UPS strike.

Yellow’s Pension Payment Problems: Yellow, one of the largest less-than-truckload (LTL) carriers in the U.S., is facing financial difficulties related to its pension obligations. The company failed to make its required pension payments for June 2023 and plans to withhold them again in July. This has led to concerns about the future of the company and its ability to meet its contractual obligations.The consequences of Yellow’s financial struggles could be profound:

  1. Impacts on Employees:
    Next, pension funds, accruals, and employee healthcare benefits for Yellow’s carriers are at risk. Lastly, if the situation persists, it could result in financial hardship for employees and retirees.

  2. Supply Chain Disruption:
    Customers who rely on Yellow’s services may experience delays and disruptions in their supply chains. Yellow’s inability to meet its obligations could lead to a slowdown in freight movement.

  3. Alternative Solutions:
    Furthermore, many Yellow customers are already seeking alternative carriers to mitigate potential disruptions. Finding reliable alternatives is crucial for businesses dependent on Yellow’s services.

  4. Security Concerns:
    Unattended freight locations due to potential disruptions can be vulnerable to theft and criminal activity. Also, adequate security measures should be in place to safeguard valuable cargo.

The UPS Strike Threat:
Another significant development is the threat of a UPS strike. While not a certainty, a strike by the United Parcel Service (UPS) could have serious consequences for the supply chain:

  1. Delayed Shipments:
    A UPS strike would likely lead to delays in package deliveries, affecting e-commerce, retail, and various industries reliant on UPS services.

  2. Inventory Management:
    Businesses may need to adjust their inventory management strategies to account for potential shipping delays, impacting cash flow and operations.

  3. Customer Satisfaction:
    Delays in shipments can result in customer dissatisfaction and reputational damage for businesses that rely on timely deliveries.

  4. Alternative Logistics Providers:
    Companies should consider diversifying their logistics providers to mitigate risks associated with potential strikes and disruptions.

In conclusion, the logistics and supply chain industries are facing uncertainties due to Yellow’s pension payment issues and the threat of a UPS strike. Lastly, monitoring these developments closely and having contingency plans in place will be crucial for businesses to navigate potential disruptions and maintain operational resilience.


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