WASHINGTON (Reuters) – White House economic adviser Jared Bernstein on Monday said the reported impending bankruptcy of cash-strapped U.S. trucking company Yellow Corp does not indicate an economy-wide problem.
The company, through a string of mergers, appeared to take on more debt than it could handle, Jared Bernstein of the Council of Economic Advisers, said in an interview with CNBC.
“So I think that this looks like a more of a Yellow story than an economy-wide one by a long shot,” Bernstein said.
Yellow Corp has ceased operations and is filing for bankruptcy after failing to reorganize and refinance over a billion dollars in debt, the Teamsters Union said on Sunday.
Earlier this month, Yellow averted a threatened strike by 22,000 Teamsters-represented workers and last week said it was exploring opportunities to divest its third-party logistics
company.
The company was the third-biggest U.S. trucker specializing in the less-than-truckload segment that combines shipments from different customers in the same trailer.
“One of the important things in terms of economic functioning from where I sit kind of overlooking the macro economy is that many of Yellow’s customers saw this coming and shifted their cargo to other providers,” Bernstein said.
“Nobody likes to see an event like this, as you say, practically a 100-year old company and iconic American Trucking Company and the job losses that you cited.”
(Reporting by Doina Chiacu; Editing by Bernadette Baum and Mark Potter)
