A.M. Executive Briefing - July 26
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Truck Sales Slip Due To Rise In Fuel Costs; Another Diesel Spike Predicted
Heavy-truck sales have dropped 6.5% in the first half of this year, another victim of high fuel costs, USA Today reported Wednesday.The outlook only gets worse for the rest of the year, as analysts are predicting a 20% decline in sales for all of 2000. The leading villain in all this, high diesel prices, should return in the fall. Analysts predict that diesel prices will rise again in September when refineries begin making home heating oil to meet the winter demand, the article said.
The Associated Press reported Wednesday that consumers are either locking in their oil prices or signing on for plans that allow them to spread out their oil payments. Consumers are trying to avoid another spike in prices like last winter's, which saw heating oil jump to $2.20 a gallon in February 2000, the AP article noted. Transport Topics
Peterbilt Announces Layoffs In Tennessee
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That represents slightly more than one-third of the assembly line employees, union officials told the newspaper. The truck manufacturer will reduce the daily output at the plant from 50 units to 35. Peterbilt had cut back production from 70 units in April.
High diesel costs and the subsequent glut of used heavy trucks on the resale market were attributed for the slow down in new unit sales. Peterbilt's parent company, Bellevue, Wash.-based PACCAR, Inc., reported Tuesday a drop in second quarter earnings and added that interest rates and increasing insurance premiums also contributed to declining new truck sales. Transport Topics
DaimlerChrysler Reports Solid Quarter But Warns Of Possible Second-Half Slowdown
DaimlerChrysler AG reported increases in net income, revenue, earnings and operating profit Wednesday but warned that the second half of the year could see a drop-off.CBSMarketWatch.com reported that DaimlerChrysler claimed tough competition in the North American market would lead to increased spending on incentives and new model launches, hence the warning.
However, the announcement of second quarter results was all positive, as the company reported an 18% increase in net income to $1.7 billion, a 17% increase in revenues to $41.7 billion, an 18% increase in earnings to $1.66 per share and a 3% increase in operating profit to $2.5 billion.
In the commercial vehicle division, enhanced last week by the pending acquisitions of Western Star and Detroit Diesel, improved in market shares in North America, but unit sales fell, the report said. DaimlerChrysler added that it expects to overcome the "softening" commercial vehicle market and achieve high unit sales and revenue. Transport Topics
Analysis Shows Profits Hit For Key Trucking Segments In 1999
Newly available financial reports from a number of trucking firms for 1999 – privately held companies as well as those with publicly traded stock – shows that profits fell sharply in several key trucking segments, including truckload hauls and refrigerated carriage.That analysis, based on reports companies file with the U.S. Department of Transportation and not previously published, will be featured in the Transport Topics' Annual Report issue on July 31.
It points out that United Parcel Service continued to outshine the results from the traditional trucking industry. Among industry groups, the best overall performance was from the contract carriers who provide dedicated trucking for shippers under pre-set contracts and on predetermined routes. Revenue of four major contract truckers rose 10.3% in 1999, and their net income was nearly 60% above 1998 results. Transport Topics
Trailer Bridge Reports Return To Profitability in Second Quarter
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Revenue increased 4.8% to $23,764,889, which the company attributed to increased shipping volume. After experiencing a net loss in the second quarter of 1999, Trailer Bridge re-ported a net income of $627,724 or 6 cents per share for the most recent quarter.
Trailer Bridge serves the continental 48 states and Puerto Rico from facilities in Jack-sonville, Fla.; New York and San Juan, P.R. Transport Topics
North Carolina DOT Unveils New System to Inform Drivers of Road Conditions
The North Carolina Department of Transportation announced this week the launch of its new real-time Traveler Information Management Systems, part of NCSmartlink.TIMS alerts drivers to incidents affecting highway travel in the state, such as construction, accidents or inclement weather. Visitors to the site (207.4.189.137/TIMS/) can choose a county or a route number to view current road conditions. Transport Topics
Quality Distribution Reports Second Quarter Results, Names New CFO
Quality Distribution, parent company to Quality Carriers and Levy Transport, reported a 2% increase in income for the second quarter, to $149.8 million.A higher fuel surcharge helped boost the revenue level for the quarter, the company said.
Quality Distribution also announced the promotion of Senior Vice President of Finance Dennis R. Farnsworth to chief financial officer. Farnsworth succeeds Richard J. Brandewie, who will remain with the company as executive vice president and member of its board of directors. Transport Topics
New Nebraska Weigh Stations Will Use PrePass
New weight stations being built along Interstate 80 in Nebraska will make use of PrePass technology, the Associated Press reported this week.PrePass allows trucks equipped with special transponders to bypass weigh stations. The transponder identifies the truck to the station and gives its weight as recorded earlier.
Sixteen states currently use PrePass, with two more committed to adding the service, the company's Web site said. As of July 8, 135,131 trucks nationwide used the PrePass technology. Transport Topics
New Ad Medium Turns Trucks Into Moving Billboards
Trykor Rolling Media Inc. announced it will debut truckside billboards - advertisements on the sides of truck trailers - in Los Angeles and San Francisco in upcoming weeks."It's a high-impact medium," company president David Margolis said of the truckside ads. "We can put the message right where the audience is."
The move to these rolling billboards is cost, time and space-efficient, Trykor said. Truckside ads are less expensive, can be produced faster and placed where billboards cannot.
FreeAgent.com, a human-resources firm, has put its ads on 15 trucks in the Silicon Valley area and plans to place additional ads on trucks in the Washington, D.C.-area technology corridor, Trykor added. Transport Topics
