P.M. Executive Briefing - May 17
This Afternoon's Headlines:
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FedEx Says Program Costs To Be Felt Starting in June
Some analysts have reduced their earnings forecasts for FedEx due to the company officials' recent statements that the costs for a sales and marketing reorganization and the creation of a home delivery unit may come as soon as June – the first month of FY2001 for FedEx.The company expects to feel most of the costs in the first two quarters of the fiscal year, which means it may not live up to analysts' earlier forecasts. But the company continues to expect revenue totaling $250 million over the full FY2001 due to the new unit and the reorganization. Wall Street Journal (05/17/00) P. C20
Wisconsin Sheriff Wants Rogue Truck Drivers Curbed
Responding to the Illinois bribes-for-licenses scandal, Milwaukee County, Wis., Sheriff Lev Baldwin wants Illinois to ensure that all truckers on the road are qualified to hold CDLs and to remove any trucker that is not qualified – and he has requested that his state's attorney general push Illinois to take those actions. Otherwise, all 465,000 Illinois CDL holders should be retested, he said.Illinois Transportation Association executive director Fred Serpe said the idea is absurd and that Baldwin's statements are meant to help him get reelected, which Baldwin denied. A spokesman for Illinois' secretary of state said that retesting all Illinois CDL holders would not be feasible and that "the vast majority ... are good drivers."
A 1994 accident that killed six children in a van, and involved a trucker now suspected of being licensed fraudulently, took place in Milwaukee County; Baldwin said that just one traffic death due to an unqualified trucker is too many. Chicago Tribune Online (05/17/00); Long, Ray
Diesel Emission Estimates May Be Too Low, Study Says
The National Research Council of the National Academies has released a report saying the Mobile Source Emissions Factor Model used by the Environmental Protection Agency to produce vehicle-emission estimates is out of date and could underestimate pollution from diesel rigs.Among other recommendations, the report says the model should be brought up to date to factor in various engine technologies, use data showing the times and places of greatest truck use, and add data about inspections, maintenance, and other techniques of controlling emissions.
The study, titled "Modeling Mobile-Source Emissions," was funded by the EPA and Transportation Department and will be released by the National Academy Press next month. TruckingInfo.com (05/17/00)
AmeriServe Sues Ex-CEO Over Funds
AmeriServe Food Distribution founder John Holten, who stepped down as the company's CEO after it filed for Chapter 11 bankruptcy protection in January, is now being sued by the firm, which alleges that he orchestrated the diversion of "tens of millions of dollars" from AmeriServe to companies he controlled.The lawsuit claims that he made the withdrawals "styled as" management fees, expense reimbursements, and sometimes even as "simple transfers" when the company was insolvent prior to the bankruptcy filing.
Holten recently told an interviewer that AmeriServe owner Holberg Industries, where he serves as CEO, derives its revenue from Holberg-owned companies' fees; he also said that AmeriServe bank agreements approved the fees and that Holberg received less money from AmeriServe than it invested in the company at the time.
Meanwhile, bondholders have been trying to determine whether, prior to a September bond offering, AmeriServe and underwriter Donaldson, Lufkin & Jenrette fully disclosed the company's condition. A motion has been filed in federal Bankruptcy Court by bondholders who want the court to support a probe into the disclosure matter. Wall Street Journal (05/17/00) P. C1; Sherer, Paul M.
Kenner Police Arrest Aspiring Trucker
Police say 25-year-old Kenner, La., resident Carlton Jackson stole truck tractors from businesses and carriers in three states on several occasions since January and that the thefts may be related to his inability to become a trucker like his father was.Jackson has failed the basic driver's license exam three or more times, which kept him from being able to get into a truck-driving school; when Jackson's home was searched, truck-driving school applications were found there. Police say he would steal the trucks from companies in Louisiana, Alabama, and Mississippi, operate them for a few days, then abandon them near his Louisiana home.
He has been charged with 10 counts of possession of stolen property. New Orleans Times-Picayune (05/17/00) P. B1; Rozas, Angela
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