Foundation and early history
In 1906, Grover Cleveland "Cleve" Harrell (1884–1942) started what was to become the Yellow Cab Company of Oklahoma with a horse-drawn hack and a team of horses in Oklahoma City. After a year, he bought a Model T Ford. People were willing to pay more to ride in an automobile. After World War I, he bought two more cars and hired a relief driver. In 1918, Harrell painted one of his cars yellow. Although ridiculed by other cab drivers, he was hauling more passengers than anyone else, so he painted all his cars yellow and business boomed. Harrell trademarked the name Yellow Cab in Oklahoma. Later, John Hertz copied the Yellow Cab in Chicago and obtained the national trademark for the use of the name.
Harrell's older brother, A. J. Harrell (1883–1972), had followed him to Oklahoma City and been successful in the operation of a horse and mule business during World War I. Cleve needed extra capital for expansion, so he formed a partnership with A. J. The company's offices were moved to 113 S. Santa Fe, and their younger brother, Marvin Harrell, and their father, Jake Harrell, were added to the payroll. The partnership started a cross-country bus line connecting Oklahoma City and Tulsa, which was later sold to Pickwick Bus Company of Tulsa. Cleve established the Capital Hill Bus Lines for the southern part of Oklahoma City, which he successfully operated for several months before selling it to the Oklahoma Street Railway Company.
When oil was discovered in the Oklahoma City area, mules were needed for work in digging slush pits, so the Harrell brothers bought mules and, in 1929, established the Yellow Transit Freight Lines to serve small manufacturers for whom freight was slow and express rates were prohibitive.[10] By 1933, with the New Deal and the NIRA, most businesses came under government regulation in an attempt to increase employment. Cleve, together with taxicab operators from other parts of the country, met in Washington, D.C. to formulate a regulatory code, but were not successful. Cleve then devised his own code and got government confirmation.
About this time, the Harrell brothers dissolved the partnership. Cleve took the taxicabs in the trade-out, as well as the Yellow Cab Dynamic Gasoline Company. He sold the taxicab business in 1940 to Eddie Fuller, who operated the Y and Y Cab Co., and maintained ownership of the gasoline company until his death on December 3, 1942. A. J. took control of the freight lines, which he operated for many years. The company remained small until 1952, when an ownership group led by George E. Powell Sr. bought the freight company. During this time, Yellow helped pioneer the concept of consolidating small freight shipments into trailer loads.
In 1968, the company name was changed from Yellow Transit Freight Lines to Yellow Freight System Inc. During the deregulation of interstate trucking in the 1980s, Yellow Freight System embarked on a massive restructuring by creating new distribution centers across the country to better serve customers. The company changed its name to Yellow Corporation in 1992, when it created a parent company, with Yellow Transportation, Inc. as its largest division.
Roadway Corp. acquisition
In December 2003 Yellow Corporation, at the time the second largest LTL carrier in the US, acquired the largest, Roadway Corporation, for US$1.05 billion.[11][12] Roadway had been spun off from its former parent, holding company Roadway Services Inc. (RSI), in 1995 and operated as an independent, publicly traded company since then. The purchase included Roadway's national operation, Roadway Express, northeast regional LTL subsidiary, New Penn, and Canadian LTL operation, Reimer Express. A new holding company, Yellow Roadway Corporation, was formed based at Yellow's headquarters in Overland Park to serve as the parent company for both Roadway Corp. and Yellow Corp.[13]
The purchase announcement came less than a year after the bankruptcy of the nation's then-third largest LTL carrier, Consolidated Freightways,[14] meaning the Yellow-Roadway merger would leave the industry with a major gap from Yellow Roadway's estimated over US$6 billion in revenue to FedEx Freight and Con-way
USF acquisition
Just a few years after the Roadway merger, the company made another significant acquisition in 2005 with the US$1.5 billion[17] acquisition of Holland, Michigan-based LTL carrier USF Corp. and its subsidiaries.[18] This brought Yellow Roadway's revenue to a high of $9.9 billion in 2006[19] with associated profit increases from $40 million in 2003 to $184 million in 2004 to a high of $288 million in 2005.[16][20] USF had experienced financial troubles prior to the acquisition but had still reported over US$2.3 billion in revenue in each of the two prior years.[21][22]
As YRC Worldwide
Following these international investments, Yellow Roadway Corp., the parent company of Roadway, Yellow, and other subsidiaries, changed its name to YRC Worldwide in 2006.[5]
YRC reported a net loss of $974 million for its 2008 fiscal year.[26] In 2009 it again reported a net loss of $622 million.[27] Towards the end of 2009, YRC narrowly averted having to file for bankruptcy protection by successfully persuading its bondholders to exchange their $470 million in bond notes for roughly 94% of the company's shares.[28] Concurrent with more recent manufacturing sector growth and recovery, since the fourth quarter of 2009, YRC again began approaching a net positive balance sheet.[29] Nonetheless, its share price declined in year 2010 more than 80%, raising in 2011 suspicions of death spiral financing.[30]
As Yellow Corporation
Given that it had divested its international interests and refocused on North American LTL operations,[5] YRC Worldwide changed its name on February 4, 2021, this time returning to the name Yellow Corporation. Its Nasdaq ticker symbol changed to "YELL" a few days later.[40] While it did not immediately change the corporate structure, the renaming was part of a larger restructuring Yellow had started in 2019 with the goal of combining all of its regional LTL services into a single network by 2022.[41] During the COVID-19 pandemic in 2020, Yellow received a $700 million federal loan as part of a rescue package. In return, the U.S. Treasury took a 29.6% stake in the company's shares. In June 2023, a probe by the U.S. Congress found that the company should not have received the loan, as its survival was not "critical to maintaining national security".[42]
2023 closure and bankruptcy
2023 closure and bankruptcy
At the end of July 2023, Yellow reportedly was in the process of ceasing all operations in anticipation of filing for bankruptcy.[6][43] The bankruptcy was seen as the culmination of mainly long-term factors such as high debt ($1.3 billion due in Q4 of 2024, with $729 million of that due to the federal government as of Q1 2023), which started increasing after Yellow began acquiring other trucking companies in the early 2000s.[44] The company previously accused the International Brotherhood of Teamsters of blocking a restructuring plan that could have saved it.[45][42][46] The threat of a strike by the union in June and July after the company failed to make a $50 million benefits payment to the pension fund caused uncertainty in the market, leading to freight volumes decreasing by nearly 80%. The company's statements of low cash reserves during the union negotiations also caused other customers to move to rival carriers such as
