Conventional wisdom is that bankrupt trucking companies alway liquidate via ch7 since shippers would shy away from a bankrupt and most of the assets can fetch something in a liquidation auction.
That was thought to be the case for finance companies before the CIT ch 11 and similar thing were said about GM and Chrysler.
YRCW could reject all of the teamster labor contracts via section 1113 and 1114 of the bankruptcy code and start paying market based wages. That appears to be their plan.
they arent look at their shipment count on the daily, they need 6oK daily to break even and work the operational service model hell they are loosing each day business...corp clients are dropping them and they have no variance for extending credit to new customers where is the growth the banks wont tolerate this.
"I know of no other major corporation that went into Chapter 11 and liquidated in less than a year" ????
Geez, where do you want me to start?
Pacific Intermountain Express (P-I-E)
St Johnsbury Trucking
Just to name a few. The LTL business isn't like any other business, Chapter 11 filings become Chapter 7 filings within days.
You're point about the airlines is invalid in this context because you're not comparing apples to apples.
Did I stutter??????????????????????
When you ship by air the freight goes on the plane in the morning and comes off in the afternoon and is delivered.
If you put it in a truck it is 3-4 days until the freight is delivered.
Shippers will not risk hundreds of their shipments being stranded on the dock of a bankrupt carrier.
They just won't do it.
Apparantly those who ship by air did not have any qualms about shipping with UAL, NWA DAL etc. when they were in bankruptcy.
Ch 11, generally allows a company to vastly bolster its financial in the short run, since they can obtain DIP financing and dont have to pay debt service, pre-petition obligations or union wages. I know of no major US coprporation that went into CH 11 and ceased operations within a year, some eventually do but much later.
The real worry would be that YRCW liquidates on Dec 7 if the exchange fails, but if shippers cared about that they would not be shipping now.
Here's the difference.
When you get on an airplane you get off that plane a few hour later. No problem.
However, when you ship freight cross country and you are a 100 shipment per day shipper, you run the risk of having hundreds of shipments stranded when a carrier decides to close their doors because the average transit time is 3-4 days.
If you worked for a company that gave a 100 shipments per day to a carrier would you take that risk with your job??????
wow I have no idea who you are, never seen your posts, but this would make sense. WHile the likes of our competitor posters hope for CH7 I'd expect CH11 and we would continue to operate.
CH11 in 2011.
IF yrc tried that, they would lose EVERY customer they had. They would need LOTS of cash to tide them over and keep the bills paid, while they TRIED to get some shippers to come back. The only way a shipper would come back, is a dirt cheap rate. And as you can see now, that doesn't work so well.
Too bad for YRC that market based wages would now be HIGHER than what they are currently paying. The answer here isn't MORE concessions from labor. If the farmer doesn't feed the oxen enough, they will graze on the crops.