Executive Briefing - Aug. 22
- AOL Leads New Round of Job Cuts
- Toyota Tests Fuel Cell in SUV
- Trism to Close Specialized Division
- MAN AG’s Net Income Off 77% on Slow Sales
- Universal Express Pays Prior Debt
- Bush Says Surplus Drops to $158 Billion
- Paccar Expands Financial Services to Europe
- Transportation Logistics Posts Increased 2Q Revenue
- Toyota Tests Fuel Cell in SUV
AOL Leads New Round of Job Cuts
Several major companies announced significant job cuts on Wednesday.Job cuts in the manufacturing sector are important for the trucking industry because they usually mean a decline in the volume of truck shipments in the next few months. In service industries, job cuts are bad news because they signal continued softness in the economy.
AOL Time Warner (AOL) announced a total of 1,700 layoffs, several weeks of warnings that the action was coming. Reuters said analysts still doubt whether the Internet and media giant can meet its 2001 financial goals.
Telecommunications equipment manufacturer Tellabs Inc. said it will close two facilities and slash 12% of its workforce, or 1,000 jobs. One plant closure will be in Ireland but the other slated for a shutdown is in Chelmsford, Mass.
I>Transport Topics
Toyota Tests Fuel Cell in SUV
Toyota Motor Corp. (TM) has begun testing of a sport-utility vehicle powered by fuel cells.The vehicle, based on the conventional Toyota Highlander, has been dubbed the FCHV-4 by the Japanese automaker. It uses fuel cells to generate electric power from hydrogen and employs, as a back up, a nickel metal hydride battery to store energy from braking.
Some experts believe fuel cells will hold the answer to the trucking industry’s search to meet more stringent clean-air standards.
The tests are being carried out in conjunction with the California Fuel Cell Partnership – a voluntary effort by the auto industry to produce a viable, production-model fuel cell. Others involved in the project include General Motors Corp. (GM), DaimlerChrysler AG (DCX) and Ford Motor Co. (F). Transport Topics
Trism to Close Specialized Division
Trism Inc. (TSMX), a transporter of secured materials, said that it is closing its Specialized Division, which transports heavy and over-dimensional materials.
The division will stop picking up shipments at the end of business on Wednesday.
The Kennesaw, Ga.-based company also said that it is planning to close terminal facilities, sell trailers and terminate most drivers and non-driver personnel associated with the Heavy Haul portion of the division. Transport Topics
(Click here for the full press release.)
MAN AG’s Net Income Off 77% on Slow Sales
Germany’s second largest truck maker, MAN AG (MAN-FRK), declared a 77% drop in net income for the second quarter, according to Bloomberg.
MAN said that its net income fell to 46 million euros ($42.1 million U.S.) from 208 million euros for the previous year, a greater than expected drop. The company’s sales fell 22% to 3.98 billion euros.
Despite this MAN said it still expects a full-year profit, though now it is forecasting as much as a one-third drop in earnings for the year.
Previously, MAN’s rivals, DaimlerChrysler AG, Scania AB and Volvo AB all reported slower sales of trucks as the general economic slowdown effects demand for shipment of goods falls. Trucks account for 40% of MAN AG’s revenues.
The company expects the truck division to show a pretax profit of between 40 million and 60 million euros. For the first half of 2001, the division showed a 96% drop in earnings. Transport Topics
Universal Express Pays Prior Debt
Universal Express Inc. (USXP), a provider of private postal and international shipping services, announced Wednesday that it has paid-off all of its previous debts and commitments, a total of $1.3 million.“The elimination of our debt enhances shareholder value and allows us room for substantial growth both in our company and in our stock valuation,” company Chairman Richard Altomare said in a press release.
Universal Express operates a logistics subsidiary, Luggage Express and an international shipping subsidiary, WorldPost as well as a series of private postal stores, PBC. Transport Topics
(Click here for full press release.)
Bush Says Surplus Drops to $158 Billion
The Bush administration said the federal budget surplus will be $158 billion at the end of the fiscal year, about 44% lower than the estimate of $281 billion made in April, Bloomberg reported.The main reasons for the lower estimate are the slowing economy and the costs related to implementing the president's $1.35 trillion tax cut.
The cut, including rebate checks being sent out this summer, is aimed at giving the U.S. economy an immediate boost, through increased consumer spending, which would also help increase the demand for trucking services.
The government's fiscal year ends on Sept. 30. Transport Topics
Paccar Expands Financial Services to Europe
Paccar Inc. (PCAR), which manufactures Peterbilt and Kenworth trucks in the United States, said that it has expanded its financial services business to Europe with the creation of a new division, called Paccar Financial Europe.
The new entity has been created to support the sale of DAF and Foden trucks, Paccar's European companies, a company press release said.
"Paccar Financial Europe is providing an outstanding resource for DAF and Foden dealers and their customers as we expand our finance operations throughout Europe," said Ken Gangl, vice president of Paccar. "Creative finance programs, designed specifically for the trucking industry, will enable DAF and Foden dealers to continue their profitable growth."
The Bellevue, Wash.-based company has also expanded its North American leasing operation, which currently counts more than 14,000 units in its fleet. Transport Topics
(Click here for the full press release.)
Transportation Logistics Posts Increased 2Q Revenue
Transportation Logistics International Inc. (TRPL) announced that its second-quarter revenues increased 75% to $2.8 million over the same period in 2000.The company also decreased its losses by 35% from the first quarter of 2001 to $195,946. The loss for the same period last year was $108,967. The company pointed to the fact it continues to expense all the costs from Translogistics Network and HumanaForce Logistics - together the two combine for $2.1 million of Transportation Logistics International's expenditures.
Operating revenues for the first half of 2001 have decreased 25% versus the same period in 2000. The major reason for the change was Transportation Logistics' sale of CDA North America in November 2000. Transport Topics
(Click here for the full press release.)
