News Briefs - April 2
The Latest Headlines:
- Consulting Firm Says Third-Party Logistics Market Growing
- CNF Releases Quarterly Estimates
- USFreightways Seeks to Change Name
- Crude Oil Continues Decline
- Eaton Plans Plant Consolidation
- Congress, White House at Odds Over Airline Bailout
- Cardinal Logistics Extends Credit Facility
- MAN to Reorganize Sales and Service Unit
- Air Canada Files for Chapter 11
- CNF Releases Quarterly Estimates
Consulting Firm Says Third-Party Logistics Market Growing
A survey by Armstrong & Associates said that for the eighth year in a row, growth in the U.S. third-party logistics market exceeded the growth rate of the overall U.S. economy.New incomes in the sector during 2002 grew by 3%, up from the 1.7% rate of growth in 2001, the survey said. Net revenues jumped 7% during 2002.
The survey pointed out a dynamic change in the logistics market, with FedEx Corp. losing 40% of its contract logistics business during the 2002 fiscal year and the logistics unit of UPS Inc. grew its revenues by 39% over the same period.
(Click here for the full press release.)
CNF Releases Quarterly Estimates
CNF Inc. said Wednesday that it now expects its first-quarter earnings per share to be in a range of between 26 and 30 cents a share.This estimate, the company said includes and 8-cent-per-share payment from the government as part of the Air Transportation Safety and System Stabilization Act.
CNF Chief Executive Officer Gregory L. Quesnel said that the results from its Menlo Worldwide and Con-Way units will both show year-over-year improvement. Con-Way has been hurt by the current U.S. economy, but, “despite essentially flat tonnage year-over-year, Con-Way is expecting strong profits for the quarter,” he added.
Quesnel said that Menlo’s results, without benefit of the government payment, are expected to be only slightly better than 2002, but that North American results from its Emery Forwarding, Menlo Worldwide Logistics and Vector SCM have been affected by the “a weaker-than-anticipated U.S. economy.”
CNF is ranked No. 4 on the 2002 Transport Topics listing of the largest trucking companies in the United States and Canada. Transport Topics
(Click here for the full press release.)
USFreightways Seeks to Change Name
USFreightways Corp. said Wednesday that it would seek approval from its shareholders to change its name to USF Corp.Chairman and Chief Executive Officer Samuel K. Skinner said that that since the company took the USFreightways name in 1996, the industry has changed and grown to more than just hauling freight. This growth has made a change necessary, Skinner said.
USFreightways Corp. is ranked No. 8 on the 2002 Transport Topics 100 listing of the largest trucking companies in the United States and Canada. Transport Topics
(Click here for the full press release.)
Crude Oil Continues Decline
The price of crude oil continued to fall after a general strike in Nigeria was called off and U.S. forces stepped up their advance on Baghdad, Bloomberg reported Wednesday.In early trading on the New York Mercantile Exchange, the price of oil for May delivery fell as much as $1.04 a barrel to $28.74, Bloomberg said.
Earlier in the week, fears of a supply crunch caused by a Nigerian strike and a delay in shipping oil from liberated regions of Iraq pushed oil prices higher. Transport Topics
Eaton Plans Plant Consolidation
Eaton Corp., a manufacturer of parts for heavy-duty trucks, said Wednesday it will consolidate five plants and fire an unspecified number of workers after the completion of the purchase of Delta Plc’s electrical unit.Eaton identified all of the factories as being overseas in the United Kingdom, Australia and the Netherlands. There aren’t expected to be any job cuts in the United States, the company said.
The Cleveland-based company purchased the Delta electrical unit on Jan. 31 as part of a plan to expand its world position in the industrial control market. Transport Topics
(Click here for the full press release.)
Congress, White House at Odds Over Airline Bailout
Both sides of Congress are working on airline bailout packages in excess of $3 billion, but the White House hinted that it disagreed with the decision, Reuters reported Wednesday.The airlines have sought more government funding, citing a drop in travel following the Sept. 11 terrorist attacks and before the war in Iraq, Reuters said.
The House is close to passing a $3.2 billion package of aid for the struggling industry, while the a plan in the Senate would provide the airlines $3.5 billion, Reuters said.
White House spokesman Ari Fleischer admonished Congress, saying that taxpayer dollars should be spent wisely, Reuters reported. Fleischer did not rule out an aid package to the airlines, telling reporters that the White House would continue to work with Congress and the industry on ways to ease the crisis.
Recently, the Department of Transportation has asked several airlines, including FedEx Corp. for refunds of aid they received in the immediate wake of the terrorist attacks. (Click here for related coverage.) Transport Topics
Cardinal Logistics Extends Credit Facility
Cardinal Logistics Management Inc. said Tuesday it had extended its senior credit facility with Fleet Capital Corp. and Transamerica Business Capital Corp. through Jan. 31, 2006.The Concord, N.C.-based company said in the release the lenders are providing a loan for new equipment acquisitions and an extension of the current banking agreement.
GTCR Golder Rauner LLC, Chicago-based private-equity firm, formed Cardinal Logistics after purchasing Cardinal Freight from Arkansas Best Corp in 1997. Cardinal provides dedicated carriage, delivery and logistics services. Transport Topics
MAN to Reorganize Sales and Service Unit
MAN AG said Wednesday that it planned to reorganize its sales and service operations in Europe to cut costs and meet new business regulations, Bloomberg reported.The company said that it would spin-off the unit into an independent company, MAN Nutzfahrzeuge Vertrieb GmbH, Bloomberg reported.
Slow truck sales and weak demand projections, in combination with new European Union regulations, were cited as reasons for the move, Bloomberg said.
The new firm will have about 5,200 employees and 900 trainees, Bloomberg said. Transport Topics
Air Canada Files for Chapter 11
Air Canada filed for Chapter 11 bankruptcy protection Tuesday, the Associated Press reported.The Canadian passenger airline became the latest major carrier to seek protection from creditors because of declining travel in the wake of the Sept. 11 terrorist attacks and the impending war in Iraq.
Many passenger carriers carry airfreight in their cargo holds, so trouble in the industry can spill out to the airfreight market. Transport Topics
