The U.S. Treasury department just announced that they will be giving YRC Worldwide a $700 million bailout thanks to funds from the CARES Act. Darren Hawkins sits on the White House Great American Economic Revival task force. He is also the CEO of YRC Worldwide.
YRC is one of the nation’s largest LTL carriers. They employ around 30,000 people. One of their most important clients is the U.S. Department of Defense. According to the Treasury Department, YRC provides 68% of all LTL services for the DOD.
That’s a large percentage, especially given that less than two years ago the federal government sued YRC, claiming that they had “knowingly” and “systematically overcharged” the DOD for their services. The Justice Department called the alleged fraud “an affront to American taxpayers” and claimed that YRC executives “made false statements to the government that hid their misconduct.”
That wasn’t YRC’s only problem however. The company had been in dire financial straits, with hundreds of millions of dollars in debt. They borrowed $400 million in 2011, $300 million in 2014, and just this past September borrowed another $600 million. And all of this for a company with a market cap south of $100 million.
While YRC’s business outlook hasn’t seemed to improve much since then, the world of politics has served the company well. Kansas Senator Jerry Moran (where YRCW is headquartered) asked Secretary Mnuchin about what the Treasury Department could do specifically to help YRCW in a senate hearing last week.
On top of that, the current CEO and one former CEO of YRC have both reached positions of influence in the federal government. Hawkins got a place on the coronavirus revival task force. Bill Zollars, Former YRC Chairman/President/CEO was nominated to serve as one of the board of governors for the United States Postal Service. He was confirmed by the US Senate on June 19th, 2020. Twelve days later, YRC’s $700 million loan was announced.
On news of the bailout, YRC’s stock price more than doubled.
As of now, YRC has $880 million in debt. They’re operating at a loss thanks to the debt, an aging fleet, high union membership levels, and high executive pay. In 2018, Hawkins brought home $4,425,681 in total compensation – including a $2,208,750 bonus.
The U.S. Department of the Treasury will receive a nearly 30% stake in the company as part of the loan terms. U.S. Treasury Secretary Steven Mnuchin called this “appropriate compensation to taxpayers.” But taxpayers are out $700 million now with no guarantee that the loan will be sufficient to save YRC.
Source: YRC, Treasury, truckersreport, truckersreport, overdrive, barrons, bizjournals, forbes, bloomberg, ttnews, freightwaves, freightwaves, freightwaves, yrcw, yrcw
I’m going to call my representatives in the House and Senate and see what they think about this
Executive bunch of lying bastards and taking taxpayers funds and dumping 30% of with less toilet paper
All you had to see was “White House Great American Economic Revival” & “$700 million bailout” to know this was ripe with corruption and ripping off taxpayers.
But most truckers I talk to keep thinking that the slimeball in charge cares about any of us…or is draining the swamp of anything… seriously, what will it take?
Good idea, me too.
Who is YRC
Yellow trucking company
Yellow Roadway Company, been failing for years at taxpayer expense
LOL, what rock do you drive under ?
Dirty politics and dirty people, the taxpayers foot the bill for filthy rich executive’s and politicians
This is disgusting! And we can’t even get the extra pay for being essential workers! Ugh
The swamp will never change.
Welcome tio the new banana republic..
How can this happen? Where is the OIG investigation? Who is the oversight for the congressperson who supported this effort? How could this pass-through so many hands and not anyone with a responsibility to stop this? The article says the US govt now has a 30% ownership in this company. The oversight should be at least 48% which I believe gives control of the company. The current owners should not be left in charge. Their new job should be to drive a truck and experience the real world. Their salary should be $20,000 a year and they should be required to drive with a trainer for 2 years. The trainer should be paid $100,000
What exactly are these CEOs doing for the good of our country? We as drivers work exceptionally hard in an extremely dangerous profession and our miniscule pay hardly reflects an honest account of reward! This extremely low level of racketeering should undoubtedly be dealt with in a most severe punishment!
sounds more like a large level of racketeering, 700 million!
I DID ASSUME BEFORE READING ARTICLE THAT THEY WERE TALKING ABOUT SWIFT. NOT to shift the point,but FRAUD against the GOVERNMENT? LOL HOW ABOUT THE GOVERNMENTS FRAUD AGAINST THE AMERICAN CITIZENS?(as they quote NATIONAL SECURITY) expecting the 🐑 to just accept it!
A 700 million dollar loan to a company who’s market cap is under 100 million?
I think a fourth grader could see the problem here.
And again the taxpayers are the one’s that lose.
“Dept of Treasury will receive nearly 30% stake in the company”? I didn’t think that was legal. Sounds like Socialism.
For the uninformed. YRCW is the merger or consolidation of two prior separate LTL companies. They were Yellow Transit and Roadway. Now they have other LTL companies under that umbrella also. Just Google or Wikipedia it.
YRC has been a loser since the early 2000’s. Of all the LTL’s, they are declining more and more every year. Once a giant in the trucking industry, now they are just a welfare case banks and now the government have to keep bailing out. Not only are the taxpayers getting stiffed, wait until the people who devoted their lives to the company go to retire, It will be a sad day.
it’s we the people/ Drivers that support working for these loser companies by working for them.
So Mr. Trump, who I like as a business person, you need to further drain the swamp and implement an Internal oversight Committee that will hold these individuals accountable. This investigating reporter has done a great job of uncovering such INTENSIONAL THEFT OF TAX PAYERS MONEY! And these thieves need to be held accountable and make with great punishment!!
You don’t actually think he’s not thick as thieves with all those criminals do ya ??? He’s done nothing but make the swamp even worse ! Never mind how he raised our taxes specifically by cutting out our per diem tax break!!
Taxpayers now own 30% of a company that is worth $200 million at it’s high point, and it only cost $700 million to do. I sure am glad that the guy who made this deal also has the authority to print money… 😛
Actually it was only valued at 70 million
lol, nice reply! agree 😊
Yellow Freight has a history of spending any profit on themselves, and never reinvest in the company to make a profit.
I can recall when freight was regulated
Malcom McClean (McClean Trucking CO.) loaned Yellow Freight money to keep them from going under.
How long ago was freight regulated ?
Now they get a “bail out” from the Government ?
Let’em go under like all the other union carriers.
I agree to let them go under. How is ABF doing it, they seem to be OK. I wonder how UPS does it, as they seem to be running empty a lot. My kat’s are of for companies like OD, Sivia and others like them that are going strong even though non-union
I totally agree. There is only what, 4-5 big union carriers left out of hundreds. If they can’t make a profit, let them go under like every other unprofitable truck line. There are no Lee Iococca’s left to help out . . .
Over 20 year’s in this business and this shutdown bankrupted me! I couldn’t even get a loan to keep me going through this! 20 grand would have kept me going and this pos walks away with millions on top of over 2 million for a bonus! Shows how much corruption is in our government!
Twenty years in this industry and not enough cash reserves to cover $20k? Were you eligible for the PPP, or did you check? There’s was still hundreds of millions available as of last week.
My banker called me last week, encouraging me to apply. I had thought about it and just crossed it off. The process is simple and faster than in the beginning. I’m a small one truck O/O that recently applied and was approved in two days start to finish.
Good luck, maybe a career change is what we need. I’m still considering it even with this. These loans are forgivable in all or part, when 60% is used for payroll. Even if not it’s 1% loan on a 5 year term. Win win either way.
If this bankrupt you , you weren’t gonna make it anyway! I don’t understand how … my freight picked up , sounds like you had the wrong deal . If you are one of those leased to land star O/O with a lone mountain leasing truck and a rented trailer you were never an owner operator anyway… go drive a company truck, I do 90 grand a year doing a dedicated 3-4 day a week deal with great benefits at My company. You couldn’t pay me enough to buy a truck right now !!
Sounds like a to big to fail thing at tax payers expense.and btw how many yrc trucks do you ever see on the road?
Actually Buckskin has the right idea, but it is no different then the time the taxpayers bailed out GM. Everybody continued to be loyal to the GM brand
I see plenty of YRC double/triples being pulled by other carriers like CRST and Schneider
I live on cup a soup and peanut jelly sandwichs, can’t keep my bills paid on time, drink water. Work seven day’s a week, just to make a CEO live like a king. And never know when I am getting home!!! Thank you greedy bastards!!!
That’s your fault… I make 90 a year , working 3-4 days a week on a dedicated run have great benefits, retirement, 3 weeks paid vacation, truck does 75 mph , most weeks on my back haul I’m only half loaded . No traffic in my lane … I love my filet mignon steaks !! Plenty of great jobs out there
And the beat goes on..
Term limits PEOPLE! TERM LIMITS, would fix all of our problems! You think this has nothing to do with term limits it has everything to do! 6.6mil pay while your company is in debt 800mil to tax payers! Absolutely discussing and it should be criminal!
So borrow borrow borrow, then when you in the shithole trade 30% of borrowed money back to the borrower and assure that you can borrow more! This is criminal
Wow. Sounds like the swamp is still alive and well.
I guess this would be the president’s idea of “draining the swamp”. SMDH
The CEO got a 2.2 million dollar bonus and the company lost money.
Why?
The only way these trucking companies stay operating is because drivers choose to work for them. Therefore whoever works for a loser company is part of the problem.
No drivers = no company.
There is always another person desperate enough for a job, to work for a loser company. If you can’t find someone with something problematic on their driving or criminal record, you can always train someone just starting to struggle in poverty. Or import someone from overseas. There is always labor available…
There’s alot of truckers that work there tail off in this industry.
Until unity comes together among the people of this country.
This type of behavior will not slow down nor stop.
What in my opinion has been overlooked is the number comments about this situation only (10) including myself had the courage to say something on this forum.
That tells me there’s (11) men so far where willing to voice there opinion.
Well said these are my true brothers regardless of race we (11) stand strong together…
🙄🙄🤦🏻♂️🤦🏻♂️🦍
How are we making America great again?
You’re trying to save 30,000 jobs,stupid!
$700 million, divided by 30,000 jobs… Okay. Only costing $23,333 per job… this time. Pretty good deal, right? Say, I work for a company that actually *makes* money… How about a $23,333 bonus, for me?
US Goverment, the only entity dumb enough, to see a company with a long, questionable record of operating with negative net profit margins and says “oh heres a loan”, knowing that theres not even a slight chance of that company ever climbing out of that hole. Specially a TRUCKING company, that produces no goods.
Negative *gross* profit (or more accurately, “operating at a loss”)… You know, *before* income taxes? Because when you don’t actually make any money, you also don’t pay any income taxes…
I wonder whether they have to pay income taxes on loan money that they took in and never pay back? Probably not… And if a company is owned by the government, does it pay taxes? Pretty sure that the post office doesn’t… How’s that work if you’re only 30% owned by the government? Do you get a 30% tax discount, or do the billionaires whose other 70% stake in the company just doubled in value, now get to evade corporate income taxes on any future earnings?
Good bet at getting lucrative postal contracts in the future, with the old CEO’s new appointment to the postal Board of Governors… Sounds like they might be setting up a good scam for future corporate tax-free profitability, on top of an existing stock price manipulation scam…
No such thing as to big to fail, if not run properly, Go under. GM learned nothing till all help ran out. The Fed should NEVER own any part of nor bail out ANY company. The Fed doesn’t generate one penny, it is all taken from tax paying Americans.
Everybody complaining but nothing is done, park your truck, sell it, if you are a driver quit the job and find another line of work or you can continue to be slave, your choice.
you are right sir, everyone complaining but not willing to park for even 24 hrs. ooida pretends to help but have you ever known them to call for, or organize trucker shut down? that is only way to bargin for fair payment for what we do! no leverage no ear
Yes. Let’s all quit working until the government stops being stupid/selfish/corrupt/run by aliens (or whatever else you may think poorly of them, for). We can stop being slaves, if we just quit working until we die. If they let us die without giving in to our demands, then they’ll die, because they won’t have any slaves to produce the stuff the they need to live. They can’t make it more than a few days, without us, and they’ll never find more slaves to replace us. We know, because we can’t make it more than one paycheck without them, and everyone knows that the Universe is fair… They would never store more than a weeks’ worth of grocery items, or more than one tank of gas… right?
All we have to do is stick together. We’ll call ourselves “The Suicide Pack”. Just make sure nobody chickens out and goes back to work when their kids get hungry or cold…
I read that the 700 million was not part of the Covid relief program but a whole separate bailout. Not sure which version is right, but it is looking like rank corruption.
Keep voting GOP……
Keep shouting COMUNISTS to everyone else….veré si rge proof that
WE LIVE IN A CORPORATE WELFARE STATE ( Just for people connected with Politicians )
And everyone else pays
Corporate welfare or individual welfare… Nobody wants either except for the recipients of both. But those are the only options represented by the two-party system that has a chokehold on our political system. Vote independent! No, wait, that’s badically voting for whichever of the candidates from the two-party system, wins… Don’t vote at all! Same outcome, though slightly less work…
We need the option to leave elected offices empty. Elected office is the only job where even if all of the candidates are grossly unqualified, we are forced to hire someone. That needs to change. But good luck with that. It’d be easier to move off the planet, to a place that hasn’t got government, yet…
13 more years and I can retire from this chickenshit industry after 46 years. I will say my Current LTL position as a Linehaul driver is the best pay and easiest position I’ve ever had. Love hauling triples…
No interest as an owner op
Not only are they drowning in debt but they will owe millions to the unions if they fold, bankruptcy won’t protect the creditors until the unions recieve their full withdrawl liability. This is another debacle our government leaders created while lobbying for union votes. I’m not anti-union but I am against bailing out their pension funds for the greed and fraud of their trustees.
These bailouts are nothing getting ridiculous why would the government bailout any company at all is my question especially companies that have proven failure rate like yrc and Chrysler and gm. You can be for certain no bank in there right mind would loan any of the 3 a nickel. Over a billion dollars loaned to yrc since 2011 and just like the automakers haven’t paid back a dime I’m sure yrc hasn’t either or ever plan on it. But I’m sure the dod will keep paying them to haul there freight even if they overcharge them. Something needs to be done about this this isn’t right why should i are any other taxpayer bailout another company all this wasted money could have been spent on fixing our roads and bridges instead of wasting it on these loser ass companies. You can bet this though not one single owner operator or small trucking company would get a bailout and those are the ones hurting right now Not these fat cats
Much of the $500 billion in transportation funding in the Moving Forward Act is tied to green measures that require states to set targets for reducing greenhouse gas emissions and make other climate conscious efforts.
“It’s not really an infrastructure bill at all. It’s a climate bill that doesn’t even attempt to include consensus solutions to these issues, but instead bludgeons our transportation system, industries and workers into submission.”
What a bunch of crap. Apparently due to poor management, we the people of the United States pay for bad behavior. We own them NOTHING. I will remember this when Moran runs again for office in Kansas. Who is getting the kick back of this?
They always help the Union workers and bail them out . Teamsters, UAW and so on. And yet American truck drivers can’t even stop for 1 day to change anything. The French drivers have bigger sacks…
yeah ,dangling of their chin’s!!!!!!
If Americans stop, Mexicans and Canadians get their freight, and Americans still get nothing. If you’re going to shut down, shut down and get out. We can’t fix the industry; all we can do is try to find a better one.
Trucking used to be lucrative and fun. Now it’s pure drudgery. No good woman, today, wants to marry a trucker. And f..k elogs!!!!
i do agree that the co. is run by blooming idiot’s, but i also see that over 30,000 hard working trucker’s and dock worker’s etc. would lose thier job’s. the gov’t should have put some one else in charge of the co. and fired all the bad one’s,to try to save the co. or bring it back to a better place. i hate to see average joe lose his job because of incompetent jerk’s that should have been fired to be able to get the loan.
The freight still has to move. Someone will move it. The trucks and the drivers don’t just disappear; they go to work somewhere else, and the jobs and trucks that they go to will be wherever the freight contracts went, because that’s who has the work to support them. There would be a difficult period of transition, but it would iron itself out quickly.
No such thing as a hard working union employee
Short Sell YRC stock now.
Bad idea, shorting $2 or $3 stock. Two or 3 years in in the upper teens is better. Could it go to zero, sure eventually. Is the risk reward that favorable, no. Statistically there are much better trades to be had that generate higher ROC.
Still want this trade, look into call credit spreads long dated if feasible.
More affirmative action by the robber baron aristocracy. What needs to cease is individuals with personal financial interests in corporations being permitted to infiltrate public institutions. This is blatant conflict of interest and runs rampant. Who knows where much of the revenue generated by these corporations falls into the hands of. Add to that the ability of these people to systematically rob public funds when the opportunity arises. The ubiquitous screw job must be eliminated.
LOL , 😂 couldn’t happen to a better bunch.
When you get rid of all your skilled talented drivers and workers; GREED SETS IN.
Every Company Yellow touches turns to BANKRUPTCY.
TNT HOLLAND
ROADWAY
JEVIC
YELLOW FREIGHT SYSTEMS
USF HOLLAND, Major Pay cuts
Agreed in part, don’t know what they do, they must siphon off the cash and waste it somehow. USF Holland must be the upper tier getting cuts. My wife is a biller there on second shift, she just let me know today she got a 1.00 per hour increase. She was off for 10 weeks due to Covid though.
In your face corruption. Lmao. It’s not what you know, it’s who you know. Land of the free.
So much for don the con draining the swamp. He made a cesspool out of it.
Who is John Galt?