Executive Briefing - Oct. 29
- UPS Launches Consulting Division
- U.S. Government Records $127 Billion Surplus
- Massive Rail Project Waiting for Approval
- FedEx Says Earnings to be Higher After Stimulus Aid
- Trucking on High Alert Since Terror Attacks
- Boyd Bros. Posts 3Q Net Income Up from 2000
- Volvo Chairman to Step Down, Paper Says
- CRST Agrees to Communications Deal
- U.S. Looking at Filling Strategic Petroleum Reserve
- Fed Observers Predict More Rate Cuts
- Visa System Flaw Draws Criticism
- Crude Oil Prices Rise as OPEC Nears Cut
- U.S. Government Records $127 Billion Surplus
UPS Launches Consulting Division
United Parcel Service (UPS) announced Monday that it is launching a new subsidiary, UPS Consulting, to offer supply chain management strategies to clients."In recent years UPS has invested heavily in growing its capabilities to bring the broadest range of solutions to our customers who want to refine their global supply chains," said Joe Pyne, UPS senior vice president for corporate development.
The company has named Gene Long, formerly the global director of supply chain consulting for Ernst & Young, to be president of the new division.
Long will be leading a “group of veteran consultants whose executive experience ranges from manufacturing to telecommunications to e-commerce,” the company said in a release. Transport Topics
U.S. Government Records $127 Billion Surplus
The U.S. government on Monday recorded a $127.2 billion budget surplus for the fiscal year that ended Sept. 30, the Treasury Department said. This follows a record $236.9 billion surplus the year before.The recent tax cuts, which have helped the trucking industry in the current economic slowdown, are a main reason why the surplus has declined.
Last year marked the government's fourth straight annual surplus, the longest stretch without a deficit since 1927-1930, Bloomberg reported. The U.S. may post a deficit in fiscal year 2002, which began Oct. 1.
Spending in fiscal year 2001 was $1.863 trillion, 4.2% larger than a year earlier. Transport Topics
Massive Rail Project Waiting for Approval
The largest U.S. rail project in modern history is waiting for the stamp of approval from Surface Transportation Board of the Department of Transportation, according to the Associated Press.The Powder River Basin Project, a $1.4 billion proposal by the Dakota, Minnesota & Eastern Railroad Corp., would connect coal fields in Wyoming with the Mississippi River.
Railroads compete with trucking for various cargoes over several different routes.
Opponents say the rail link would destroy the environment along its 900-mile line, while the railroad says it would be an economic boon to the region and would be beneficial to the environment by delivering cleaner burning coal from Wyoming to power plants and factories in the East. Transport Topics
FedEx Says Earnings to be Higher After Stimulus Aid
FedEx Corp. (FDX) announced Monday that its earnings for the second quarter of fiscal 2002, which ends November 30 will be in the 40 to 45 cents per share range, excluding government assistance as a result of the Sept. 11 terrorist attacks.However, the company’s statement said, when the government aid from the Air Transportation Safety and System Stabilization Act is added in, the earnings per share jump to the 61 to 66 cents per share range.
The company’s earnings projections, both with and without government assistance factored in, do account for the other financial effects of Sept. 11, such as decreased cargo and shipping delays.
The company reported that it received $101 million from the government bailout package.
"Solid growth at FedEx Ground and outstanding cost management across the entire corporation will contribute to profitability for this quarter," said Alan B. Graf, Jr., executive vice president and chief financial officer.
The company expects solid growth at its FedEx Ground division as well as in its new home delivery and its core business-to-business services.
In projecting its earnings, the company said its new Dynamic Fuel Surcharge will not be an appreciable factor in the quarterly results. The quarter ends Nov. 30 and the charge does not go into effect until Nov. 5. Transport Topics
(Click here for the full press release.)
Trucking on High Alert Since Terror Attacks
The trucking industry is on high alert since the Sept. 11 terrorist attacks, fearing that it could be the next weapon turned against the United States.Truckers, trucking companies and even truck stops are looking closer at each other, and taking extra precautions. Those precautions range from padlocking trailer doors to communicating regularly with dispatchers, the Associated Press reported.
The American Trucking Associations has urged drivers to keep in regular contact with their dispatchers, vary their routes to avoid being followed and park with other trucks or at a reputable truck stop, the AP said.
Security from both the government and from companies has been heightened since investigations related to the attack showed that potential terrorists may have tried at acquire commercial driver licenses and permits to haul hazardous materials with designs on using heavy trucks as weapons. Transport Topics
Boyd Bros. Posts 3Q Net Income Up from 2000
Boyd Bros. Transportation Inc. (BOYD) reported third quarter earnings of 8 cents per share, or $230,210, an improvement of 10 cents per share over the company’s third quarter loss of 2 cents per share in 2000.The Clayton, Ala.-based company which specializes in flatbed-truckload hauling, also said its operating revenue for the quarter that ended on Sept. 30 was up 4% to $32.46 million.
For the year-to-date, Boyd Bros. is showing a net income of $220,018, or 8 cents per share. For the same nine-month period in 2000, the No. 91 company on the Transport Topics 100 list posted a net income of $374,611, or 12 cents per share. Transport Topics
(Click here for the full press release.)
Volvo Chairman to Step Down, Paper Says
Lars Ramqvist, chairman of Volvo AB (VOLVY), is likely to be replaced in April, the Swedish newspaper Dagens Industri reported.
Volvo will probably name Per-Olof Ericsson, currently a company director, the new chairman, the paper said.
The world's second-largest manufacturer of heavy trucks posted a third-quarter loss of $146 million and has announced job cuts and plant closures in an effort to stay profitable.
Ramqvist was also replaced as the chairman of Ericsson AB - the largest company in Sweden, effective in March. Transport Topics
CRST Agrees to Communications Deal
CRST Van Expedited Inc. has reached a long-term agreement to use the CabCARD Communication Services, according to a Qualcomm Inc. (QCOM) press release.The CabCARD system allows drivers to receive e-mail and other electronic communications directly into the cab. The system utilizes Qualcomm’s Mobile Data Interchange, which the release said eliminates the need for fleet involvement with integration, billing and reconciliation issues.
The companies tout the system as a driver retention tool that enables drivers to keep in touch with friends and family. Transport Topics
(Click here for the full press release.)
U.S. Looking at Filling Strategic Petroleum Reserve
Industry experts and political leaders believe President Bush is considering topping off the Strategic Petroleum Reserve, the New York Times reported.
The unprecedented move of filling the reserve to its full capacity would be done as a precaution in case tensions in the Middle East were to disrupt the flow of oil to the United States, the paper said.
Aides to President Bush told the Times that the reserve could be topped off in several ways including increased funding from Congress to purchase oil, royalty payments to the government from companies that drill in the Gulf of Mexico could come in the form of oil, rather than cash or a combination of the two.
Created in 1975, the Strategic Petroleum Reserve is designed to smooth out price fluctuations in the U.S. oil markets. The price of oil has a direct impact on the cost of providing trucking services because trucks depend on diesel fuel or gasoline for power. Transport Topics
Fed Observers Predict More Rate Cuts
The Federal Reserve is likely to cut rates at both of its next two meetings, with a total drop by as much as one full point, some analysts are predicting.In a report in USA Today, many Fed watchers believe the Fed will cut rates at its Nov. 6 meeting and again on Dec. 11. The cuts will bring the central bank's benchmark interest rate, already at a 39-year low, to historically low levels, the paper said.
Despite the already low rates, many economists said that the Fed will have to be even more aggressive than it already has if it is to help the nation stop what is now commonly believed to be its first full-blown recession since 1991. Transport Topics
Visa System Flaw Draws Criticism
The Immigration and Naturalization Service is coming under fire because of a flaw in its new high-tech visa program for Mexican nationals who frequently cross the border into the United States, the New York Times said.The new visas, which are about the size of a credit card, were instituted to speed border crossings for frequent visitors to the United States. Since 1998, four million cards have been issued - but none of the machines designed to read the cards have been put in place.
Since Sept. 11, delays have a common occurrence on the border, and those delays have put a more intense spotlight on the INS' inability to provide quick, secure border crossings. Transport Topics
Crude Oil Prices Rise as OPEC Nears Cut
The price of crude oil rose more than 2% to $21.50 in international trading as an oil minister indicated that the Organization of the Petroleum Exporting Countries will cut production for the fourth time this year, Bloomberg reported.The oil minister for Saudi Arabia, one the largest oil producers in OPEC said members of the cartel would meet in Mexico City Monday to discuss the scale of the cut.
The 11-member cartel will also meet with representatives form seven non-OPEC oil producers to gain support of a cut, Bloomberg said. Some non-member countries have backed a cut of one million barrels per day. Currently global oil production is about 76 million barrels of oil per day, according to the Energy Intelligence Group. Transport Topics
