News Briefs - July 12
The Latest Headlines:
- Mineta Allocates $56.3 Million for State Highway Work
- Will the Fed Slash Interest Rates Again?
- New Truck/Rail Tunnels Eyed For Windsor-Detroit
- Consumer Optimism Falls in July, Survey Finds
- Crude Oil Rises to Eight-Week High
- Oshkosh Begins Trading on NYSE
- GeoLogistics Names Flynn CEO
- Calif. Motorists Find Stable Gasoline Prices
- UPS Reports Lower 2Q Earnings
- W.Va. Coal Weight Limit May Close Mines
- Navistar Says Strike Not Affecting Output
- Intermodal Loadings Up During Holiday Week
- Will the Fed Slash Interest Rates Again?
Mineta Allocates $56.3 Million for State Highway Work
Transportation Secretary Norman Y. Mineta said Friday that the Federal Highway Administration would be doling out $56.3 million for highway projects in 43 states and Puerto Rico.The projects include seismic retrofitting of bridges and bridge research; highway construction on public lands and in national parks and funding for ferry boats and terminals to facilitate the movement of people and goods across inland and coastal waterways, the Department of Transportation said.
he majority of the funds will go toward bridges, with $23.5 million going toward seismic bridge refitting and $17.2 million being allocated to bridge research and construction. Transport Topics
Will the Fed Slash Interest Rates Again?
A key indicator has begun to suggest the Federal Reserve may cut interest rates again, despite being at 40-year lows since the end of last year, CNNFN reported Friday.The Fed cut interest rates 11 times in 2001 in an attempt to stimulate spending, which boosts the demand for the trucking services.
The monthly fed-funds futures contracts are saying there's a 10% chance the Fed cuts at its Aug. 13 meeting and a 16% chance it cuts at its Sept. 24 meeting, the story said.
The main reason, the story said, is the recent decline of the stock market could force the Fed to step in.
However, economists remain skeptical the Fed would lower interest rates based on stock prices alone. Transport Topics
New Truck/Rail Tunnels Eyed For Windsor-Detroit
The Detroit River Tunnel Partnership said Friday it is examining the potential for new tunnel between Detroit, Mich., and Windsor, Ontario, that would ease traffic congestion and improve U.S.-Canada trade flows.The partnership is a joint venture of the Canadian Pacific Railway and Borealis Transportation Infrastructure Trust, which is owned by the Ontario Municipal Employees Retirement System.
The DRTP already owns the rail tunnel and corridor linking Highway 401 in Ontario to Interstate 75 in Michigan. The project being considered would convert the tunnel‘s two rail tubes into a truck route. It would also develop a new rail tunnel in the same corridor to accommodate all types of rail cars.
Together, the partnership said, the truck and rail tunnels would form a secure zone for an efficient, cost-effective route. Transport Topics
(Click here for the press release.)
Consumer Optimism Falls in July, Survey Finds
U.S. consumer sentiment took a dive in July, the University of Michigan reported Friday in its monthly report.Consumer sentiment is important to trucking because confident consumers are more likely to purchase goods, spurring delivery orders by stores and boosting the demand for trucking services.
The university’s preliminary report on consumer sentiment fell to 86.5 in July, from a June reading of 92.4. Economists had expected a reading of 93 for this preliminary report, Bloomberg said, but sliding stock prices clouded many people’s outlook on the economy.
This was the first time the index has been below 90 since December 2001. Transport Topics
Crude Oil Rises to Eight-Week High
The price of crude oil rose $27.34 in New York and 26.35 in London as the International Energy Agency cut its forecast for oil demand growth this year by more than one-third, Bloomberg reported Friday.Crude oil prices eventually dictate the diesel fuel and gasoline prices truckers find at the pump.
While low demand would be expected to exert downward pressure on the price, the demand forecast leads analysts to expect that the Organization of Petroleum Exporting Countries will maintain its current low output levels for another quarter, the story said.
Weak rises in crude oil demand are a result of weak economies around the world, and analysts blame the most recent drop in trader confidence on the accounting scandals at Enron Inc. and WorldCom Inc., the story said. Transport Topics
Oshkosh Begins Trading on NYSE
Oshkosh Truck Corp., a manufacturer of defense and commercial trucks, began trading its common stock on the New York Stock Exchange on Friday.The company had been listed on Nasdaq since its initial public offering in 1985. Its new trading symbol is OSK.
"The move to the NYSE reflects Oshkosh Truck's commitment to providing outstanding value for our shareholders through improved trading efficiency and wider visibility for our stock," said Robert Bohn, chairman, president and chief executive officer.
Bohn rang the opening bell on Friday. Transport Topics
(Click here for the full press release.)
GeoLogistics Names Flynn CEO
Freight forwarder GeoLogistics Corp. said this week that William J. Flynn will take over as president and chief executive officer effective Aug. 1. Flynn will succeed current president and CEO Robert Arovas who has been head of the company since 1999.Flynn comes to GeoLogistics from CSX Transportation where he was senior vice president of that company’s merchandise service group.
Based in Santa Ana, Calif. GeoLogistics is a non-asset based global logistics provider dealing transportation management, freight forwarding, customs brokerage and other cargo management services. Transport Topics
(Click here for the full press release.)
Calif. Motorists Find Stable Gasoline Prices
Motorists have found stable, reasonable gasoline prices through this half of the summer driving season and there are no supply or demand issues to hurt that stability in the near future, the Automobile Club of Southern California said Thursday.While most trucks run on diesel fuel, many smaller fleets rely on vehicles using gasoline.
Weekly changes in gasoline prices for three straight weeks have been less than one cent at around $1.60 to $1.70, around 25 cents less than last summer’s prices, at many popular California vacation areas like San Diego and the Los Angeles-Long Beach area, the Club said.
The Club compiles its data in the Weekend Gas Watch. Transport Topics
(Click here for full press release.)
UPS Reports Lower 2Q Earnings
United Parcel Service Friday reported second-quarter earnings of $611 million or 54 cents a share, down from the $630 million or 55 cents share earned a year earlier, Reuters reported.The package delivery company said earlier this week that it was being force to lay off some employees because shippers are diverting business to rivals as a result of concerns that UPS could be shut down by a strike by the International Brotherhood of Teamsters. (Click here for the related story.)
Total revenue rose 2.5% to $7.68 billion from $7.49 billion a year before, fueled by international growth.
The company said negotiations will continue through the weekend in the attempt to agree on a new contract before the old one expires July 31. (Click here for a press release.)
The company released its earnings earlier than scheduled because of its recent inclusion in Standard & Poor’s 500 index, Reuters reported. Transport Topics
(Click here for full press release.)
W.Va. Coal Weight Limit May Close Mines
A compromised new weight limit of 120,000 pounds, proposed by the governor Thursday and supported by trucking and coal industry officials, may still force 10% to 15% of the state’s mines to close, the president of the West Virginia Coal Association told the Associated Press.The trucking industry hoped for limits as high as 139,000 pounds on four-lane roads, as haulers say they could not make a sufficient living if they complied with the current standards, 80,000 pounds on main roads and 65,000 pounds on secondary roads, the story said.
This proposal was made by Gov. Bob Wise and his truck safety committee, and after the legislation receives his final approval it will go before lawmakers in a special session beginning Sunday, AP said. Transport Topics
Navistar Says Strike Not Affecting Output
Truck maker Navistar International Corp. said the strike that began June 1 at an Ontario plant has had little effect on its heavy-duty truck output because of increased production at a Mexican plant, Bloomberg reported Thursday.A spokesman told Bloomberg the company has increased production at the plant in Escobedo, Mexico, to 58 trucks a day from 31 before the strike and said the plant in Chatham, Ontario, also built about 40 trucks this week with managers doing the work.
Company attempts to bring in replacement workers were halted after several supporters of the Canadian Auto Workers were hurt in a June 24 incident involving security guards in a van.
The company won a court injunction preventing striking workers from blocking streets, but it has not again attempted to use replacement workers.
Prior to the strike, the Ontario plant made about 39 trucks per day. Transport Topics
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Intermodal Loadings Up During Holiday Week
The number of intermodal loadings on the nation's railroads rose 5% from the previous year during the week ended July 6, the Association of American Railroads reported Thursday.Intermodal is the segment of the railroad business that most directly competes with long-haul trucking.
Trailers and containers loaded during the week totaled 147,949 compared with 140,940 in the corresponding week of 2001. Both weeks included the July 4 holiday.
Containers continued to outpace trailers - with the number of container loadings increasing 8% to 108,595 and trailer loadings dipping 2.6% to 39,384, the report said.
For the first 27 weeks of the year, trailer and container loading totaled 4,706, 651, which was 4.1% higher than the 4,519,676 loaded by the same point the previous year. Transport Topics
