A.M. Executive Briefing - Sept. 6
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Diesel Skyrockets to Record High; California Sees 12-Cent Spike
A 7.3-cent-per-gallon increase drove the national diesel retail price to a record high of $1.609 per gallon, the Energy Information Administration reported Wednesday.All regions reported price hikes, but the West Coast had the largest at 9.5 cents – driven by a 12.4-cent jump in California. That left average diesel prices there just below $2 per gallon, the report said. (Click here for more fuel prices.)
The American Trucking Association's weekly report said such increases are just a preview of what may happen in the upcoming winter months, as demand builds for heating oil, which competes with and in turn affects diesel fuel prices.
ATA President Walter McCormick wrote to President Clinton Tuesday, asking him "to act swiftly to release oil from the Strategic Petroleum Reserve to avert human and economic disaster." Transport Topics
Volvo Talks With Mitsubishi Over Its Stake in Company
The world's No. 2 truck maker Volvo is in talks with Mitsubishi about Volvo's stake in the Japanese company's truck and bus division, Bloomberg reported Wednesday.Volvo is reportedly concerned over the increase of influence by DaimlerChrysler, the world's largest truck maker, in Mitsubishi. Volvo's rival is negotiating to increase its holdings in Mitsubishi to 34%, the article noted.
Volvo, in turn, has agreed to buy a 19.9% share of Mitsubishi Fuso Truck & Bus for $340 million, according to Bloomberg.
Volvo and Mitsubishi are also discussing how Volvo's role in the two companies' truck making alliance would be affected by an increased role in Mitsubishi from DaimlerChrysler, Bloomberg said.
All this comes against the background of an ailing truck market worldwide – a result of a slowdown in segments of the North American freight market, last year's big jump in truck output leading to a glut of vehicles, and soaring fuel costs cutting into the number of buyers and driving down prices for used trucks. Transport Topics
French Trucker Protest Continues to Squeeze Fuel Supply
Those French truckers and farmers who have blockaded oil refineries to spread their pain over higher fuel prices rejected as too little a government offer to cut their taxes, Bloomberg reported Wednesday.The news service said the trucker protest is now causing gasoline supplies to run out at filling stations across France. It cited an inusdtry source saying that 25% of stations on major roadways are partly or completely out of fuel.
This is the latest and most dramatic in a string of truck protests around the world over soaring fuel costs this year. They have taken place in North America, Thailand and the U.K., and may not end soon. A private analysis on Tuesday said recent jumps in the wholesale price of fuel have not yet passed through to the pump price. Transport Topics
Freightliner Notifies Customers of Brake Recall
Freightliner announced that it has informed its bus and fire and emergency vehicle customers with vehicles manufactured between March 1998 and August 2000, equipped with air brakes and with Bendix Anti-Lock Braking System (ABS) EC 17-1030R electronic control units (ECU), of a defect in that system leading to a recall.Thomas Built Buses, Freightliner Trucks and Sterling Trucks dealers have been notified of the recall and are prepared to properly inspect affected vehicles, the company said.
The recall is due to a defect in the braking system which can possibly increase stopping distances in the vehicles, Transport Topics previously reported.
A Freightliner official said dealers will inspect existing systems and replace the Bendix ABS electronic control units with a new unit. Transport Topics
Oil Price Keeps Rising; OPEC Output Hike May Not Help
Crude oil prices continue to rise, reaching a 10-year high in London Wednesday, as traders expect any production increase that OPEC may announce will not be enough to alleviate the supply situation, Bloomberg reports.Crude hit its highest level since November 1990 at $33.50 per barrel in the latest London trading session, while oil also rose on the New York Mercantile Exchange to $34.35 per barrel, the article said.
OPEC, under pressure from countries such as the United States, will consider a third production boost this year as its members meet this weekend.
Some traders, however, do not foresee an increase as enough to drive down prices or build up oil inventories. And tight inventories are likely to further push up diesel fuel prices during trucking's peak fall season and through the winter months, according to Bloomberg. Transport Topics
Intermodal Facility Not Feasible for Arkansas, Study Shows
A $15,000 study revealed an intermodal cargo facility is not feasible in northwestern Arkansas, the Associated Press reported.The committee studying the possibility of a cargo facility, where containers could be transferred between trucks and trains, said that based on the study the proposed center is a no-go.
A member of the Sam M. Walton College of Business Supply Chain Management Research Center of the University of Arkansas said the center would cost $14 million to build – an amount he estimated would not be recouped for 10 years. Transport Topics
Honeywell Will Sell Brake Materials Unit to Questor
Honeywell and Questor Partners Fund II announced Wednesday that Questor will acquire Honeywell's Friction Materials division, which makes brake products for the transportation industry.The division makes products such as disc brake pads and drum brake linings, as well as brake fluids, parts and other components, for original equipment manufacturers and the automotive aftermarket.
The brand names Bendix, JURID and RoadTuff are under the friction materials business, but Honeywell will retain the right to use the Bendix name in other applications as it will continue to operate the Bendix Commercial Vehicle Systems business, the announcement said. Transport Topics
Headlines From Yesterday's P.M. Briefing
- Leading Transport Analyst Cuts Five Trucking Firms' Ratings
- Recall Spreads of Buses, Trucks Over ABS Problems
- France Begins to Ration Gasoline Due to Trucker Blockade
- Economy Has Yet to Feel Effects of Oil Price Jump, OPIS Warns
- CarrierPoint, Viewlocity To Offer New Business Solution For Shippers and Carriers
- Logistics.com Turns to Cukor for Software
- Newgistics Helps Create Return Network
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