Executive Briefing - Sept. 24
- Bush, Chretien Want to Keep Trucks Moving
- Gen. Schwarzkopf to Speak at MC&E
- NHTSA Reports Third Drop in Truck-Related Deaths
- Northwest Raises Cargo Rates
- FedEx Announces Stock Repurchase Plan
- United Shipping & Technology Announces Fiscal 4Q Results
- Phar-Mor Files For Chapter 11
- Bush Begins Releasing $40 Billion in Funding
- Ryder to Take 3Q Charge; Expects to Meet Estimates
- Crude Oil Price Posts Largest Drop Since Gulf War
- Gas Prices Slip 2 Cents, Survey Says
- Analysts: Daimler May Need to Reduce 2002 Forecast
- Emery, FAA Agree on $1 Million Fine
- Shipping Cos. May Face Rising Premiums
- Congress Considers New Tax Cuts, Journal Says
- Gen. Schwarzkopf to Speak at MC&E
Bush, Chretien Want to Keep Trucks Moving
President Bush and Canadian Prime Minister Jean Chretien agreed Monday that the terrorist attacks should not hamper the flow of trade between the two nations, the Associated Press reported.Although there have been reports of long delays at the border due to increased security checks following the attacks, both leaders stressed that trucks should move as quickly as before in each direction.
Chretien also said that the economies of both countries will suffer if there are impediments at the border. Transport Topics
Gen. Schwarzkopf to Speak at MC&E
The American Trucking Associations said Monday that General H. Norman Schwarzkopf will speak at the 2001 Management Conference & Exhibition, scheduled for Oct. 28-31, in Nashville, Tenn.
"We are pleased that General Schwarzkopf has chosen to join us during this important conference as the entire trucking industry reflects MC&E's theme, 'Standing Together, Moving America Forward,'" said William Canary, ATA interim president and chief executive officer. Transport Topics
NHTSA Reports Drop in Truck-Related Deaths
Truck-related fatalities have dropped for the third year in a row, a new report issued by the National Highway Traffic Safety Administration said.In its Fatality Analysis Reporting Systems assessment for the year 2000, NHTSA said fatalities involving large trucks dropped by 3.1% from the previous year. There were a total of 5,211 truck-related fatalities in 2000 -- 169 less than in 1999.
In a press release issued by the American Trucking Associations, interim President and Chief Executive Officer William Canary credited continued industry support for tougher driver standards, increased roadside inspections and better targeting of high-risk drivers and motor carriers.
NHTSA collects crash statistics from the 50 states and the District of Columbia to produce the annual FARS assessment. Transport Topics
( for the full press release.)
Northwest Raises Cargo Rates
Northwest Airlines has moved to raise its rates for shipping cargo on its fleet of aircraft, according to the Journal of Commerce.Slated to begin on Oct. 15, Northwest will make several changes to the way it prices air cargo. First, it will eliminate the 5% commission it pays to freight forwarders on international shipments. The airline will also increase the minimum charge on domestic air waybills. The final change is a new $5 security surcharge on all airfreight waybills.
An increase in air cargo rates could have the effect of diverting some cargo to trucks.
Northwest is believed to be the first airline to raise air cargo rates in the wake of the Sept. 11 terrorist attacks. The airline operates 12 cargo only planes in addition to shipping cargo in the bellies of passenger planes. Transport Topics
FedEx Announces Stock Repurchase Plan
FedEx Corp. said Monday that its board of directors has authorized the repurchase of up to 5 million shares of the company's common stock.The Memphis, Tenn.-based company, which has 298 million shares outstanding, said purchases can be made in the open market and in negotiated or block transactions.
Last week, FedEx reported a net income of $109 million, or 36 cents per share, for the fiscal 2002 first quarter ended Aug. 31.
FedEx is ranked No. 2 in the 2000-2001 Transport Topics 100.
( for the full press release.)
United Shipping & Technology Announces Fiscal 4Q Results
United Shipping & Technology declared revenues of $106.7 million for the fiscal fourth quarter, down $33 million from the same period a year ago.The provider of customized, nationwide delivery service through its brand name Velocity Express, US&T said the decrease resulted from a divestiture from its non-core business, the closure or consolidated unprofitable locations and what the company called “adverse economic conditions.”
The company reported that it is continuing to make progress toward its goal of achieving profitability by October 2001.
"The company has demonstrated consistent improvement in net operating results for the last two fiscal quarters, both over the prior year and quarter to quarter," said Jeff Parell, chief executive officer. Transport Topics
(>Click here for the full press release.)
Phar-Mor Files For Chapter 11
Phar-Mor Inc. has filed to reorganize itself under Chapter 11 of the United States Bankruptcy Code, the company announced in a press release.The retail drug store said it has secured $135 million in debtor-in-possession financing through Fleet Retail Finance to fund the company's operations through the reorganization process.
During the reorganization, Phar-Mor will continue business as usual at all of its locations for the time being, but said it plans to close 65 of its 139 stores in the next few weeks. Transport Topics
( for the full press release.)
Bush Begins Releasing $40 Billion in Funding
President Bush on Friday released a $5.1 billion emergency spending package -- the first installment of some $40 billion in emergency funds enacted last week.According to the White House press release, the funds are to “assist in the humanitarian, recovery and national security needs” related to the Sept. 11 terrorist attacks in New York and Washington.
The funds are intended to assist victims and address other consequences of the attacks, such as debris removal, search and rescue, increased airport security and sky marshals, as well as initial repair of the Pentagon and variety of other purposes.
Some $141 million of the funds will be allocated to the Department of Transportation to support increased airport security measure, as will as expenses for Sky Marshals, New York Harbor patrols and call-up of Coast Guard reservists. Transport Topics
Ryder to Take 3Q Charge; Expects to Meet Estimates
Trucking company Ryder Systems Inc. said on Monday it will take a third-quarter charge of $50 million to $54 million related to cost-cutting efforts.Some of the costs will include the previously announced reduction of between 600 and 700 positions from its work force.
The Miami-based company said revenue in the first two months of the third quarter fell more sharply from the year-earlier period than it had expected, but cost cuts have generated better-than-expected results.
Ryder said earnings for the third quarter, excluding restructuring and other charges, should meet or exceed its previous after-tax estimates of 47 cents to 49 cents per share. It will release results on Oct. 24. Transport Topics
( for the full press release.)
Crude Oil Price Posts Largest Drop Since Gulf War
Crude oil posted its largest drop in a decade, reaching 17-month lows, Bloomberg reported.The drop was said to have come from concerns that weakening economies may slow further, reducing demand for energy.
Brent crude oil for November settlement fell as much as $3.14, or 12%, to $22.30 a barrel on the International Petroleum Exchange in London on Monday. That is the biggest decline since the Gulf War in January 1991.
The price of the diesel fuels and gasoline used by commercial trucks relates directly to the price of crude oil and a drop in that price is likely to lead to lower gasoline and diesel prices.
In the U.S., crude oil for November delivery fell as much as $2.73 to $23.24 a barrel in electronic trading on the New York Mercantile Exchange.
Meanwhile, Bloomberg also reported that the Organization of Petroleum Exporting Countries may be unable to prevent a slump in prices under current conditions. The cartel is scheduled to meet on Wednesday. Transport Topics
Gas Prices Slip 2 Cents, Survey Says
The price of gasoline fell 2 cents per gallon over the last two weeks, its first drop in a month according to the Lundberg Survey.The survey, conducted by analyst Trilby Lundberg, looks at the price of all grades of gasoline and accounts for nationwide fuel taxes at 8,000 filling station in the United States. The survey found the average price of gasoline to be $1.54 a gallon.
While much of commercial trucking is conducted with large, diesel burning trucks, a good deal is also done using smaller gasoline powered trucks. The price of gasoline can have a measurable affect on the price of trucking services.
Lundberg attributed to the drop to industry restraint and weak demand for gasoline in the wake of the Sept. 11 terrorist attacks, the Associated Press reported. Transport Topics
Analysts: Daimler May Need to Reduce 2002 Forecast
Analysts think lower demand for U.S. products will cause DaimlerChrysler AG to reduce its profit forecast for 2002, Bloomberg reported.Bloomberg said analysts think the potential effects of a war on terrorism and a possible recession will cause U.S. consumers to defer vehicle purchases.
At the same time, DC has already forecast a loss of $1.2 billion for its Freightliner LLC subsidiary this year.
DaimlerChrysler is parent company to Freightliner, largest seller of heavy-duty vehicles in America. Freightliner, in turn, is parent company to Sterling and Western Star, both of which are also truck manufacturers.
A continuing downturn in sales of new trucks has 30% of Freightliner’s dealers on the brink of bankruptcy, Stark's News Service reported, also noting that the company is hoping to re-open negotiations with its union. It hopes to reduce wages $2 per hour, adopt co-payments for health plans and cancel bonuses and wage increases. Transport Topics
( for full press release.)
Emery, FAA Agree on $1 Million Fine
CNF Inc.’s Emery Worldwide Airlines has agreed to pay a $1 million civil fine to settle claims by the Federal Aviation Administration for maintenance deficiencies, Bloomberg reported.The settlement will help the airfreight company, which has been grounded for five weeks, resume flying by early next year if it makes improvements during the next six months.
The story said that it still is not clear how much this will cost the company, and there still is a chance it could close down.
CNF is based in Palo Alto, Calif., and also owns Con-Way Transportation Services and Menlo Logistics. It is ranked No. 3 in the Transport Topics 100. Transport Topics
Shipping Cos. May Face Rising Premiums
A German newspaper is reporting that shipping companies are expected to share in the rising insurance premiums predicted for the airline and other transportation industries.Handelsblatt reported that insurance costs could increase by a factor of 10, to 0.05% of the value of the ship, due to recent terrorist attacks on New York and Washington.
The shipping industry is important to the trucking industry because trucks are called upon to carry goods to and from seaports – often in intermodal containers.
In addition, insurance costs for potential terrorist hotbeds will also increase. Travel through the Suez Canal may increase a shipper’s premium by 400%. The paper reported insurers are also covering ships for routes in the Persian Gulf and Indian Ocean. Transport Topics
Congress Considers New Tax Cuts, Journal Says
U.S. House and Senate leaders are beginning to write a package of tax cuts and other economic-stimulus measures that could total as much $100 billion in 2002, the Wall Street Journal reported.Any package would likely include business-tax breaks with expanded unemployment benefits, a payroll-tax credit and possibly an increase in the minimum wage.
A tax cut can be good news for the trucking industry if it helps to boosts the economy and increases freight shipments.
However, the story said that leaders are being cautious after warnings from Federal Reserve Chairman Alan Greenspan and others that too much stimulation could actually damage the economy. Transport Topics
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