Executive Briefing - Aug. 24
- Officials Can Mandate 'Clean' Vehicles, Judge Rules
- Russia Raising Oil Production
- VW May Invest More in Heavy Trucks
- PC Market Sputters, First Time in 15 Years
- Gasoline Drops Again in California
- Economists Approve of Fed’s Actions, Poll Finds
- Rail Intermodal 2.9% Down On Year
- Russia Raising Oil Production
Officials Can Mandate 'Clean' Vehicles, Judge Rules
A federal judge ruled Thursday that air quality officials in southern California can force public agencies to purchase environmentally friendly trucks and buses for their fleets, Reuters reported.The rules would apply to fleets of 15 or more -- including buses, trash trucks, airport shuttles and street sweepers, and force these agencies to purchase low-emission or alternative-fuel vehicles. The intent is to make an impact on air pollution in the region, which, the SCAQMD said has some of the country's dirtiest air.
The ruling will apply in Los Angeles, Orange, Riverside and San Bernardino counties.
The suit, challenging proposed new rules by the SCAQMD, was brought by Engine Manufacturers Association and the Western States Petroleum Association on the grounds that they violated Clean Air Act. Transport Topics
Russia Raising Oil Production
Just as the Organization of Petroleum Exporting Countries is preparing to cut back on oil output, Russia, the world’s second-largest exporter, is increasing production with the opening of two new pipeline systems in the Baltic and Black seas.This is threatening OPEC’s goal of supporting the price of oil, but these exports are also crucial for the Russian economy, the New York Times said.
Increases in world oil supply that come outside the jurisdiction of OPEC quotas may push prices of diesel and gasoline lower, which many truckers would view as a positive development.
This year, Russia has increased production by 7% or 466,000 barrels per day, while OPEC has cut back 13%. By 2005, Russian exports could increase by as much as 45%, according to estimates by the Deutsche Bank. Transport Topics
VW May Invest More in Heavy Trucks
Volkswagen AG (VOW-FRK) said it may get more involved in the heavy truck segment, Reuters reported.
Board member Bernd Pischetsrieder said at the company’s annual meeting that more investment in the heavy truck market was possible, but only if it would allow Volkswagen to become one of the top two players in the European market.
Pischetsrieder recently indicated the company is on the lookout for possible acquisitions to expand its truck business.
VW’s move into the truck market started last year with the purchase of a part of Swedish truck maker Scania. The company is thought to have its eye on MAN AG (MAN-FRK), as well as purchasing more of Scania, according to Reuters. Transport Topics
PC Market Sputters, First Time in 15 Years
Worldwide sales of personal computers are expected to be lower than last year, something that has not happened in 15 years, the Wall Street Journal reported.
Once a major force behind the economic boom of the 1990s, the PC market is now sputtering. In the past few months, the five largest manufacturers of PCs have combined to lay off thousands and accept a total of $2.1 billion in charges. Even Dell Computer Corp. (DELL) has warned that annual revenue may fall for the first time in its 17-year history, the Journal said.
The manufacturing sector accounts for about 20% of U.S. economic production and is one of trucking’s important customer segments. And computer shipments had been a major reason why many trucking companies were successful during the boom economy.
The slowdown appears to be more than just a cyclical slump, the paper said. Back-to-school sales, generally a good indicator of how holiday PC sales will perform, are off. In addition, companies are purchasing new computers with less regularity, according to the article. Transport Topics
Gasoline Drops Again in California
Labor Day drivers in California will enjoy the lowest gasoline prices they’ve seen all summer, the Automobile Club of Southern California said.Although the biggest trucks use diesel fuel, a significant portion of the commercial trucking business is carried out in trucks that use gasoline.
The auto club said the current price in the Los Angeles/Long Beach area is $1.530 per gallon, nearly 5 cents per gallon lower than at this time last week. This is the 13th straight week the price has declined.
The current price is 50 cents below the record high for the state, which was set on May 25, 2001.
In San Diego, the auto club reported that the price is nearly 4 cents below last week’s average, while the central coast of California saw a drop of 3 cents.
In Las Vegas, motorists were paying 1.1 cents less than last week, and in the Phoenix-Mesa region of Arizona, the drop was 0.4 cent. Transport Topics
(Click here for the press release.)
Economists Approve of Fed’s Actions, Poll Finds
The Federal Reserve's approval rating among economists has risen significantly this year, according to a new study by the National Association for Business Economics.Two-thirds of the economists polled approved of the Fed’s aggressive actions to keep the United States out of a recession, up from just over 50% in early March, Reuters reported. Earlier this week, the Fed cut interest rates for the seventh time this year (See story, Aug. 21).
Rate cuts are important to the trucking industry because if they lead to increased spending by businesses and consumers, it will create more demand for their services through increased production of manufactured goods.
Looking ahead, over 50% of the economists said they expect that the Fed would only cut interest rates by half a percentage point or less over the next six months. Transport Topics
Rail Intermodal 2.9% Down On Year
Rail intermodal traffic in the first 33 weeks of the year amounted to 5,576,672 trailers and containers loaded, lagging 2.9% behind the 5,745,345 loaded in 2000, the Association of American Railroads reported.During the year-to-date, trailers loaded have totaled 1,637,579 compared to 1,817,228 last year, which amounted to a 9.9% drop.
Over the same period, containers came to 3,939,093, a 0.3% gain over the 3,928,117 loaded in 2000.
Rail intermodal, in which truck trailers and containers are carried for the long haul by rail, is the part of the rail business most competitive with trucking. Containers tend to reflect the level of seagoing trade; trailers, however, are more representative of domestic trade activity.
For the week ended Aug. 18, rail intermodal was 1.1% behind last year, with 179,778 trailers and containers, compared with 181,855. Trailers were 7%, while containers were 1.3 above the 2000 container total for the week. Transport Topics
