Newtork Alert 2 - Teamsters Approve Tentative Deal with UPS... & Update on Yellow

  

Hard Deck Logistics is reporting that the Teamsters Union voted to approve a tentative deal with UPS this past Monday, which means now a unionwide vote is set to occur later this month. It is reported that the union approved a nearly $30 Billion contract in a landslide vote. The deal provides wage increases for most employees and as well provides more benefits to nearly all UPS employees. It is very important that this issue looks to be on the path of being resolved as had a tentative deal not taken place, the impact on U.S. economies and shippers could have been one of the costliest work action impacts in history. Several professional associations cheered the tentative deal which still needs to be ratified. UPS is, needless to say, a leading supply chain player and a key part of keeping our country running smoothly. 

 

On another note, the looming work actions that were possible with another major market player, Yellow (which in late July this story seemed to be on somewhat of a positive note when it looked like Teamsters' work actions would at least be temporarily averted) went from bad to even worse as Teamsters as well as multiple other sources reported that Yellow would be filing for bankruptcy. Oddly, the Yellow stock closed Tuesday at $3.90 per share, more than doubling for a second day in a row. Analysts agree that avoiding bankruptcy would be unlikely for Yellow, as Yellow has faced financial woes for more than a decade. However, the stock price increase may signal some value buyers see in Yellow's equity. The impact could be quite severe regardless, as freight is already being shifted from Yellow to other companies and even to other modes of transportation including rail as most shippers will play contingency options to not be at risk with Yellow. 

 

Hard Deck Logistics will continue to follow this important news as well as other disruptions in supply chain.