竞争对手的选择随着老黄运费sets as shippers plan for LTL rate hikes

The dismantling of Yellow Corp. assets has begun, and so has the realignment of the $58 billion less-than-truckload (LTL) landscape.

Richmond, Va.-based Estes Express, the nation’s fourth-largest LTL carriers with $4.4 billion revenue last year, has made a $1.3 billion bid for all of Yellow’s 160 company-owned terminals.

Estes’ bid was shortly topped by a $1.5 billion offer for the terminals by LTL industry leader Old Dominion Freight Line. ODFL is required to make a 5% deposit. The bids remain effective for 180 days, or until around Feb. 1.

Those “stalking horse” bids effectively set a floor for Yellow’s assets, and would effectively wipe out bankrupt Yellow’s long-term debt. Yellow was the nation’s fifth-largest trucking company when it announced Chapter 11 bankruptcy protection on Aug. 7.

Among Yellow’s creditors is the U.S. government. It effectively owned 30% of Yellow following a $700 million loan to Yellow in the final days of the Trump administration because of Yellow’s perceived importance in military shipments as one of hundreds of trucking companies employed by the Department of Defense.

If Estes were able to acquire all of Yellow’s terminals, it would have more than 420 North American terminals – making it the largest LTL carrier by terminal door count in North America.

The dismantling of Yellow, besides idling 22,000 Teamsters and 8,000 non-union workers, is the biggest redistribution of assets in the history of the American trucking industry. The previously largest LTL closure was Consolidated Freightways, which closed on Labor Day 2002.

Yellow moved approximately 50,000 packages a day, according to outside estimates. That amounted to about a billion pounds of freight a day to be dispersed among Yellow’s former major LTL rivals.

Estes figured to be one of the largest beneficiaries of Yellow’s closing before the offer to buy all of Yellow’s terminals. Among other carriers reporting higher load volumes as a result of Yellow’s cessation are FedEx Freight, ABF Freight System, XPO, Saia, TForce Freight (formerly known as Overnite and UPS Freight) and Averitt Express.

XPO官员说,大约一半的黄色business left the LTL market to other modes of transportation. But they said that freight should eventually return to LTLs, though may take a couple of years, according to management.

Yellow’s cessation occurred in the middle of the peak shipping season for U.S. ground freight. Shippers are in the process of migrating their LTL shipments to an array of other carriers.

Those former Yellow shippers can expect higher freight charges. While overall LTL rates are expected to rise around 7% this year, there are lanes where former Yellow freight is fetching as much as 15% increases in rates, according to industry officials.

One can see the impact in mid-year tonnage reports from Yellow’s former major LTL rivals. There was what Cowen trucking analyst Jason Seidl called a “very notable increase of shipments per day in July” ahead of Yellow’s Aug. 7 bankruptcy announcement.

ABF Freight, TForce Freight and XPO are what Seidl calls “best positioned to win the most freight, given their similar weight/pricing to Yellow.”

But Old Dominion Freight Line and Saia also “should benefit,” Seidl said. But they are taking what he called a “methodical approach” to taking on new freight that will not jeopardize service for their existing customers.

“There is ample capacity in the LTL network to absorb this freight, though it gives carriers the ability to be more aggressive on pricing despite a softer volume environment when excluding Yellow,” Seidl wrote in a note to investors.

Here are some of how Yellow’s former rivals have competed for freight in and around the date of Yellow’s closure.

• ABF Freight saw its core LTL shipments per day in late July rise 10% year over year.
• ODFL had 3,000 incremental shipments per day in late July, with roughly half of that above what management had been previously forecasting.
• Saia saw a 2.2% decline in tonnage in June turn to a 2.5% gain in tonnage in July.
• TForce is handling about 26,000 shipments/day more in recent weeks, up from around 23,000 before the bankruptcy.
• XPO saw July tonnage growth intensify as July progressed, with shipments per day growing by about 3,000.

But Seidl said excluding Yellow from the 2Q earnings equation, results reflected a “soft environment” for LTL pricing in mid-year. Yields softened and fuel surcharge revenues declined as “softer industrial and consumer demand weighed on results,” he said.

But LTL stocks for publicly held carriers have increased materially. As a group, they are up more than 80% YTD, compared with the 17% rise in the S&P 500. While multiples for the group have not hit their all-time highs, every LTL is now trading above their five-year forward average, Seidl noted.

“We believe that 3Q earnings will come with very high expectations (XPO up nearly 130% YTD) and any sign of tonnage normalization could result in a notable selloff,” Seidl said.

He recalled the Consolidated Freightways bankruptcy on Labor Day 2002. Back then rival LTL carriers saw large tonnage increases immediately following the bankruptcy. But that short-term benefit was fleeting until much of that former CF freight found a new “permanent home.”

As much as 25 to 50% of Yellow’s freight could go to carriers outside the top 10 largest LTL providers, according to a research note by Goldman Sachs.

Yellow’s preferred debt-holders should benefit tangibly from sale of its old trucking terminals. Those in or near urban areas have been a gold mine for sales in this century. That is because of changing real estate patterns, tight zoning and environmental requirements and Not-in-My-Backyard biases against heavy trucking rumbling through neighborhoods.

A 24,000-square-foot former Yellow terminal in Compton, Calif., was sold to Universal Logistics Holdings for $80 million this year.

Estes has more than 280 freight terminals in the US and Canada, 9,600 tractors and 37,000 trailers. Estes is a powerful freight presence in its home turf of the Southeast, but is looking to enlarge its LTL footprint nationally.

Reuters reported that Citadel and hedge fund MFN Partners – which owns 42% of Yellow’s stock – will provide $142.5 million in bankruptcy financing to Yellow. The financing agreement estimated a six-month auction period for Yellow’s assets.

As for equipment, Yellow owned about 12,700 tractors and 42,000 trailers. Thanks to the federal government’s $700 million infusion of cash into the company, Yellow bought 1,400 new Volvo VNR tractors in 2021 and 2022. The average price of a Class 8 truck is around $50,000. It’s unclear what value the massive numbers of Yellow’s old equipment will have on the used truck market.