News Briefs - Sept. 9
The Latest Headlines:
- U.S. Xpress Buys 500 Tractors From Volvo
- Fed's McTeer Says Rates Are Low Enough
- Demand Won't Grow, Scania's CEO Says
- Iraqi Threat Inflates Crude Oil Price
- Port Strike Could Hurt Businesses, Port Expert Says
- Postal Service Seen Earning $600 Million
- Lawmakers to Huddle on Engine Rule
- NTSB Targets Pre-Trip Brake Inspections
- Mullen to Acquire Kam's Oilfield Hauling
- Fed's McTeer Says Rates Are Low Enough
U.S. Xpress Buys 500 Tractors From Volvo
Volvo Trucks North America Inc. said Monday truckload carrier U.S. Xpress Enterprises Inc. has ordered 500 of Volvo's new VN tractors.Delivery of the VNL780 models will begin in the second quarter of 2003, Volvo said in a release. One hundred of the vehicles will be equipped with Volvo VE D12 engines, while the rest will have Cummins ISX engines.
All of the engines will be compliant with Environmental Protection Agency requirements for engines built after Oct. 1, 2002, a Volvo spokesman said.
(Click here for the full press release.)
Fed's McTeer Says Rates Are Low Enough
Dallas Federal Reserve Bank President Robert McTeer said interest rates are as low as they need to be to stimulate an economic recovery, USA Today reported Monday.Trucking will benefit from an upturn of the economy.
A voting member of the Federal Open Market Committee, McTeer said while lower rates could give a boost to home refinancing or consumer spending, he is not sure it would help business investment spending. He said that is a key to the recovery.
McTeer and other Fed policymakers meet Sept. 24 to discuss what to do with the Fed's short-term interest rate target, which has been at a 40-year low of 1.75% since policymakers finished an aggressive series of cuts last December. Transport Topics
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Demand Won't Grow, Scania's CEO Says
Scania AB's Chief Executive Officer, Leif Oestling, said that the Sweden-based truck maker is not counting on truck demand in Western Europe to improve next year, Bloomberg reported.Oestling also forecast an industrywide drop of sales by 15% during the 2002 year to between 190,000 and 200,000 trucks, Bloomberg said.
He told reporters that questions about the potential for future economic growth will likely stall truck sales during 2003. Transport Topics
Iraqi Threat Inflates Crude Oil Price
A report by an international watchdog group bolstered the United States' case for military action against Iraq and pushed the price of crude oil above $30 a barrel in trading Monday morning, Bloomberg reported.Crude oil is distilled down into motor fuels like diesel and gasoline - both of which can put a pinch on trucking companies' bottom line.
The report by the International Institute for Strategic Studies said that Iraq could build a nuclear weapon in "months" if it were to obtain fissionable nuclear material, Bloomberg said.
The news sent oil prices up by about 2% or 59 cents a barrel to $30.20 in pre-opening electronic trading on the New York Mercantile Exchange, Bloomberg said. Transport Topics
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Port Strike Could Hurt Businesses, Port Expert Says
A strike by the International Longshore and Warehouse Union, could hurt businesses all across the country, a leading economics professor and expert on ports told the New York Times Sunday.David J. Olson, a professor of economics at the University of Washington, said that a short work stoppage at ports along the West Coast would affect commerce at major port centers like the Puget Sound, San Francisco Bay and San Pedro Bay near Los Angeles, the Times reports. Also, it would hurt those companies that depend on just-in-time truck deliveries.
A strike of a couple of months or more would hurt businesses across the country, especially if it were to happen before the holiday shopping season, Olson told the Times.
The ILWU has been negotiating a new contract with the Pacific Maritime Association - a negotiation that began before their old agreement expired on July 1. Transport Topics
Postal Service Seen Earning $600 Million
The U.S. Postal Service said it expects to earn about $600 million in the next fiscal year, Bloomberg reported Friday.The government agency is one of the largest users of medium- and heavy-duty trucks.
Although the service previously said it may lose as much as $3 billion, cost-cutting and increased revenue from the recent increase in rates has led to the positive projection, Bloomberg said.
The health of the U.S. Postal Service affects the entire mailing industry, Bloomberg said, which contributes $900 billion a year and nine million jobs to the U.S. economy. Transport Topics
Lawmakers to Huddle on Engine Rule
A congressional delegation failed to meet last week with House Speaker Dennis Hastert to discuss whether to introduce legislation to delay the Oct. 1 deadline for new large trucks to be equipped with lower-emission diesel engines.A legislative assistant for Rep. Ray LaHood (R-Ill.), who was trying to organize the meeting, said lawmakers tried to hold a discussion but ran out of time. “I think it is more reasonable to believe that it will happen next week,” Andrea Tebbe said Sept. 5.
LaHood had said a legislative option might be the last resort for extending the deadline. The White House and Environmental Protection Agency previously refused to postpone the date.
Lawmakers have said truck and engine manufacturers face thousands of layoffs because so few new engines have been ordered, as trucking companies have been wary of new models they have not had time to thoroughly test. Some producers have already announced layoffs.
LaHood and others have urged that the deadline be delayed a year or more. Potential buyers have been voicing concerns over the reliability and performance of the post-Oct. 1 engines. John Wislocki
This story appeared in the Sept. 9 print edition of Transport Topics.
NTSB Targets Pre-Trip Brake Inspections
The National Transportation Safety Board recommended that the Federal Motor Carrier Safety Administration require pre-trip brake inspections, after the board concluded that a truck-school bus collision in Arkansas last year was caused by reduced efficiency of the truck’s brakes.The brakes had been poorly maintained and inadequately inspected, NTSB said. Three pupils died on May 31, 2001, after an 18-wheeler failed to stop at the bottom of an exit ramp near Mountainburg, Ark., and collided with the bus, NTSB said.
he agency said an examination showed that eight of the truck’s 10 brakes were either out of adjustment or nonfunctional, with four of them unable to provide any braking force.
The driver reported he had last adjusted the brakes four days before the crash and visually inspected them the morning of the accident, the NTSB said, but the agency concluded he did not follow recommended practice for the pre-trip brake inspection. Daniel L. Whitten
This story appeared in the Sept. 9 print edition of Transport Topics.
Mullen to Acquire Kam's Oilfield Hauling
Canadian truckload carrier Mullen Transportation Inc. said Monday it has agreed to acquire Kam's Oilfield Hauling and should close the transaction on Oct. 1.Kam's is a provider of rig moving and oilfield related services in the northeastern portion of Alberta. Terms of the deal were not disclosed.
Mullen is based in Aldersyde, Alberta, and ranked No. 70 on the 2002 Transport Topics 100 list of the largest U.S. and Canadian trucking companies. Transport Topics
(Click here for the full press release.)
