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Warning to forwarders: a perfect storm on the horizon for US supply chains
23 Jul, 2023

The US supply chain faces several challenges, including decreasing product demand, the war in Ukraine and rising inflation. However, a potential UPS strike – along with a chance that Yellow Freight goes insolvent – could create a perfect storm, with disastrous economic consequences.

UPS is the largest package delivery company in the world and it handles a significant portion of the freight traffic in the US. If UPS was to go on strike, it would immediately disrupt the delivery of goods to businesses and consumers nationwide.

Yellow Freight is a less-than-truckload (LTL) carrier the US federal government rescued with $700m as an emergency loan under the CARES Act. In exchange for the emergency loan, the Department of Treasury announced that US taxpayers would acquire a 29.6% equity stake in the company. Yellow Freight is a major player in the LTL market, and its bankruptcy would leave a significant void in the industry, with 30,000 lost jobs, US taxpayers at a loss and manufacturers without a significant trucking provider.

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