News Briefs - March 11
- FedEx Drops Arthur Andersen, Hires Ernst & Young
- Crude Price Jumps On Concern Over U.S.-Iraq Conflict
- Economists See Fed Adopting Neutral Stance
- French Truckers Blockade Oil, Fuel Facilities in Hours Dispute
- Price of Gasoline Surges
- Ergonomics Hearing Postponed, Kennedy Says
- OPEC Expected to Maintain Output Curbs
- Bush Signs Stimulus Bill
- Corporate Vision Completes Deal for Stony's Trucking
- Crude Price Jumps On Concern Over U.S.-Iraq Conflict
FedEx Drops Arthur Andersen, Hires Ernst & Young
Package delivery company FedEx Corp. announced Monday that it has dropped the embattled accounting firm Arthur Andersen LLP in favor of Ernst & Young LLP.Many major corporations have tried to distance themselves from Arthur Andersen after the collapse of Enron Corp.
Arthur Andersen will handle FedEx’s financial statements for the fiscal quarter ended Feb. 28, but then Ernst & Young will take over for subsequent accounting tasks.
FedEx is ranked No. 2 on the 2000-2001 Transport Topics 100 list. Transport Topics
Crude Price Jumps On Concern Over U.S.-Iraq Conflict
The price of crude oil rose more than 3% in international trading Monday as concerns grew that the United States could expand its war on terrorism to include Iraq, Bloomberg reported.Instability in the Middle East, which could threaten the supply of oil, has caused the price of crude to rise. Crude is refined to produce gasoline and diesel fuel, making its price crucial to the trucking industry.
On the International Petroleum Exchange in London, the price of crude oil rose 72 cents, or 3.1%, to $24.05 a barrel on Monday, Bloomberg said.
Iraq currently supplies 3% of the world’s oil supply, but many of its neighbors are major exporters like Kuwait and Saudi Arabia. Transport Topics
Economists See Fed Adopting Neutral Stance
Economists at 14 of 22 bond firms that trade directly with Federal Reserve said in a survey by Bloomberg that they expect Fed policy makers to adopt a neutral stance on whether inflation or weakness is the bigger threat to the U.S. economy.For the past 15 months, the Fed said weakness was a greater risk. Policy makers had cut interest rates 11 times in 2001 in an attempt to stimulate spending and increase production, which boosts the demand for the trucking services.
The survey found that 16 of these economists expect the Fed to raise rates at least once by the end of the third quarter, Bloomberg said Monday. Only five economists surveyed believe the cuts will start during the second quarter. Transport Topics
French Truckers Blockade Oil, Fuel Facilities in Hours Dispute
Truck drivers in France blocked access to some oil refineries and fuel depots on Monday to protest a government proposal that would change the way their salaried hours are tabulated, the Associated Press reported.The plan, the truckers say, would reduce the pay they receive for non-driving activities like recharging their trucks’ batteries, the AP said. The pay reduction would force them to work longer hours, the truckers argue.
Police were stationed at key airports and depots and chased away some truckers threatening to blockade those facilities, the AP reported. Four unions participated in the protest, but the largest trucking union did not.
Despite calls to make the protest a nationwide event, the blockades were only really effective in southern France, the AP said. Transport Topics
Price of Gasoline Surges
Rising crude oil prices and maintenance work at refineries caused gasoline prices to increase by 8.77 cents over the last two weeks, according to the Lundberg survey of 8,000 gas stations nationwide.Although long-haul trucking mainly uses diesel fuel, a large segment is carried out in gasoline-burning vehicles.
The weighted price per gallon for all grades and taxes on Friday was nearly $1.24. The rise of nearly 9 cents per gallon was the largest in almost a year, the Associated Press reported.
Analyst Trilby Lundberg said she expects prices to continue to rise in the coming weeks. The size of the increase, she said, could depend on what happens in the Middle East. Transport Topics
Ergonomics Hearing Postponed, Kennedy Says
Sen. Edward Kennedy (D-Mass.) has agreed, at the request of the Bush administration, to postpone a scheduled March 14 hearing on what the Labor Department plans for ergonomics policy.Kennedy's press secretary, Jim Manley, said no date had yet been set for the hearing. On March 8, Manley had said he had been informed that Labor intended to issue "voluntary guidelines" after Easter to safeguard workers, including truck drivers and package sorters.
Labor Secretary Elaine Chao was scheduled to appear at the now-delayed hearing to discuss the administration's plans. She had postponed announcing those plans on at least two other occasions.
Manley told Transport Topics guidelines would be "unacceptable," and would lack stiff penalties to penalize employers for unsafe working conditions. John Wislocki
For more information on ergonomics, see the March 11 print edition of Transport Topics. Subscribe today.
OPEC Expected to Maintain Output Curbs
The Organization of the Petroleum Exporting Countries is likely to maintain its current production curbs through June, Reuters reported Monday.Both diesel fuel and gasoline, used in large quantities by the trucking industry, track with the price of crude oil.
The cartel will meet Friday and a senior delegate told Reuters that options for the second half of the year would be kept open.
OPEC has sought to keep the price of oil above $20 a barrel by reducing production and by convincing non-OPEC producers to join in the reductions.
The market basket of prices OPEC uses to measure demand, stood at $21.71 on Thursday, Reuters said.
For much of 2001, OPEC sought a price in the $22-28 a barrel range, but now appears willing to settle for the low end of that range, Reuters said. Transport Topics
Bush Signs Stimulus Bill
On the weekend before the six-month anniversary of the terrorist attacks that threatened the U.S. economic system and pushed the nation deeper into its recession, President Bush signed an economic stimulus bill into law Saturday, the Associated Press reported.Among the provisions in the stimulus are tax breaks designed to stimulate investment in equipment, which would benefit trucking companies. Truckers also would benefit from general increases in business and consumer spending.
Also included in the package is an extension of unemployment benefits to 39 weeks from the normal 26-week term, the AP said. The package would cost the U.S. Treasury about $51 billion this year, Reuters reported.
An earlier version of a stimulus bill had became bogged down in partisan politics, at one point declared dead by Senate Majority Leader Tom Daschle (D-S.D.). The passage and signing of a scaled down version of the bill come as many recent economic reports indicate signs of recovery.
Businesses would also be able to use current losses to reduce tax payments for the previous five years. Transport Topics
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Corporate Vision Completes Deal for Stony's Trucking
Business venture company Corporate Vision Inc. said March 6 it has completed the acquisition of Stony's Trucking Co., the parent company of B-Right Trucking Co. and B-Right Intermodal Transportation Inc.B-Right Trucking is a common and contract carrier operating mainly in the Midwest, South, and Southwest. B-Right Intermodal is a national transporter of ocean containers, rail containers and privately owned equipment.
Corporate Vision said it is starting a new subsidiary, CV Transportation Inc. as it gets involved in the freight transportation business. Transport Topics
(Click here for the full press release.)
