Executive Briefing - June 26
- New Campaign Fights Construction Delays
- Complaints Force Michigan to Fix I-75
- Hyundai, Bering Dealers to Meet Wednesday
- Most Expect Rate Cut As Fed Begins Meeting
- International Paper, Others Announce Job Cuts
- Oil Prices Not Linked to Inflation, OPEC Chief Says
- DHL Expands in China
- More Fuel Efficiency Possible, NAS to Say
- Bush May Name Board in Airline Dispute
- Complaints Force Michigan to Fix I-75
New Campaign Fights Construction Delays
The U.S. Chamber of Commerce on Tuesday announced a campaign to shrink the amount of time it takes to get roads, runways and rail lines built, the Associated Press reported.Executives in the transportation construction industry say that it can take up to 10 years or more to get projects off the drawing board because of environmental impact statements and other legal obstacles.
Sally Jefferson, the chamber's top transportation lobbyist, said that outdated infrastructure is costing both businesses and consumers billions of dollars each year. So, the Chamber is forming a coalition called the Americans for Transportation Mobility to push for quicker transportation improvements.
However, critics are claiming this is just an attempt to eliminate important environmental protections. Transport Topics
Complaints Force Michigan to Fix I-75
Responding to complaints from truckers, the Michigan Department of Transportation has made emergency repairs to Interstate 75, including the bridge deck over the Dix-Toledo Highway, the Detroit News reported.Although the multi-million dollar permanent fix of the road is planned for next summer, several recent accidents involving trucks forced the state to perform some repairs ahead of schedule.
More than 105,000 vehicles travel this stretch each day, and within one week one truck lost its load and another lost diesel fuel. Each accident caused heavy delays.
One driver who uses the road several times each week to go to and from Canada said there are many large potholes that jerk the steering wheel away from drivers. Transport Topics
Hyundai, Bering Dealers to Meet Wednesday
Officials from Hyundai Motor Co. plan to meet Wednesday with dealer representatives for Bering Truck Co. in Irvine, Calif., to discuss how it can help dealers continue to sell and support Bering trucks, a dealer told Transport Topics.The dealer said that the meeting was Hyundai’s idea and that the dealers are concerned about two things: being true to "a moral obligation" to support customers and their needs; and getting help from Hyundai in obtaining parts, service and warranty support.
On June 19, Bering said it had suspended operations because Hyundai had failed to provide key components and support. Transport Topics
Most Expect Rate Cut As Fed Begins Meeting
The Federal Reserve begins its two-day policy-setting meeting on Tuesday, and is widely expected to lower interest rates for the sixth time this year, although the size of the cut is unclear, news services reported.Analysts who follow the trucking industry note that any rate cut can immediately reduce monthly interest expenses for some trucking operations, if they carry large floating-rate debt on their equipment.
Regardless of what the Fed decides, analysts told the Associated Press that the effects of previous cuts have yet to be fully felt in the economy.
The Fed is expected to announce its decision regarding interest rates about 2:15 EDT on Wednesday. Transport Topics
International Paper, Others Announce Job Cuts
International Paper Corp. and two other companies will undertake restructuring plans that will eliminate a total of 4,905 jobs from their North American work forces.Job cuts in the manufacturing sector are important for the trucking industry because it usually means a decline in the volume of truck shipments in the next few months.
IP will eliminate 3,000 jobs from its domestic work force in a drive to reduce costs and better align resources, a company press release said. The cuts will represent 10% of IP’s U.S. salaried employment.
Meanwhile, Kemet Corp., a maker of electrical parts used in cell phones and computers, said Monday that it will cut 1,805 manufacturing and support jobs at its U.S. and Mexican facilities.
The cuts are expected to save $36 million a year.
Also, Cytec Industries, a specialty chemical company, will close an ammonia plant in Wageman, La., and lay off 100 employees in a plan designed to save $7 million a year. Transport Topics
(Click here for the International Paper’s press release.)
Oil Prices Not Linked to Inflation, OPEC Chief Says
The Organization of Petroleum Exporting Countries’ secretary-general has issued a statement saying that oil prices have a minimal impact on inflation, signaling that OPEC will not order production increases, Bloomberg News reported.Oil prices have been identified as a major factor in the financial difficulties of truckers in the U.S., forcing many small companies into bankruptcy.
According to Bloomberg, Ali Rodriguez said fluctuations in oil prices have a smaller impact on inflation than in the 1970s.
Rodriguez had already said Friday that there would be no need for OPEC to raise quotas at its July 3 meeting. Transport Topics
DHL Expands in China
DHL Worldwide Express will open 11 new offices in China, expanding operations with a total of 37 offices by the end of the year, the Asian Wall Street Journal reported.The air-cargo company holds 36% of the $11.3 billion market for international air-cargo shipments.
U.S. air-freight trade with Asia last year was $6.3 billion, more than half of the international total. Transport Topics
More Fuel Efficiency Possible, NAS to Say
The National Academy of Sciences is expected to issue a report next month saying that the U.S. government could raise its fuel efficiency standards for cars and trucks by a modest amount with few penalties in safety or cost, Reuters said.It's also expected to discuss the benefits of diesel engines, which are more fuel-efficient but don't meet future clean-air standards.
Although the NAS will likely not recommend a specific increase in standards, it may give a range of possible increases. It also could warn of safety concerns for lighter vehicles, and perhaps propose a different set of fuel standards based on how much a vehicle weighs. Transport Topics
Bush May Name Board in Airline Dispute
If American Airlines fails to reach agreement with its flight attendants by June 30, President Bush will head off a strike by naming an emergency board to mediate the dispute, the Associated Press reported.The airline announced a tentative accord with the Transport Workers Union Sunday, which is subject to ratification.
Because nearly 60% of air cargo flies in the bellies of passenger planes, any disruption in air traffic, such as strike if American's negotiations had not produced an agreement, could push more cargo to trucks or force shippers that use an airline to seek alternative carriers.
June 30 would mark the end of a cooling off period mandated by the Railway Labor Act, which covers airline bargaining.
If an emergency board is named, a second 30-day cooling off period begins before the parties meet under the aegis of the board, for yet a third 30-day period.
While an emergency board's recommendations are not binding, they often form the basis for an agreement. Transport Topics
(Click here for the full press release from American Airlines.)
