A.M. Executive Briefing - Sept. 18
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Regional LTL Carrier Crouse Halts Operations
Crouse Cartage Co., a regional trucking company based in Carroll, Iowa, that specializes in consolidated less-than-truckload shipments in the central United States, has discontinued operations effective Sept. 16 because of its operating losses.The announcement came from its Lenexa, Kan.-based parent, TransFinancial Holdings, which said it expects to take a onetime, after-tax charge of about $21 million related to the Crouse halt.
TFH also said Crouse intends to form an advisory committee of unsecured creditors to assist management in an orderly liquidation of assets and disposition of claims. Crouse said it would contact each creditor on procedures for handling claims. Crouse also announced that it had made arrangements for the delivery of all freight currently within its system.
L.A. Roads Busier With Transit Strike
Roads in one of the nation's busiest cargo truck zones just got busier, as a transit strike pushed almost half a million Los Angeles-area commuters to seek other ways to get to work, Bloomberg reported Monday.The strike, which started on Sunday, has idled subways, light rail and 2,000 buses, the wire service said. Mayor Richard Riordan said in a report carried by CNN television that while he wants to settle this quickly he also wants to negotiate away some arcane work rules that get in the way of efficient management.
Meanwhile, an area already known for thick smog and thick traffic on its freeways has to absorb thousands of extra drivers for now. Besides being home to a huge consumer market served by trucking, the area holds the nation's two largest container ports of Long Beach and Los Angeles docks. A large number of those intermodal containers travel through the region by truck. Transport Topics
Norfolk Southern RR May Downsize to Cut Costs
Norfolk Southern Corp. - a huge Virginia-based railroad that sprawls across the East Coast, Southeast and Midwest - is considering reductions in perhaps 3,000 miles of its 22,000-mile network, the Wall Street Journal said Monday, as a way to further pare costs.That could both open some regional opportunities for truck competitiors with lessened rail service in some areas, and stiffen market conditions for trucking over time by making the rail service more efficient or less expensive.
The story said most of the cuts being eyed are shorter branch lines and mainly in the Southeast. The railroad could sell, lease or abandon them, the Journal noted.
Meanwhile, NS and eastern rival CSX continue to grapple with the added costs they encountered after they split up the big Conrail system, and then suffered extensive congestion problems and lost business from shippers. Transport Topics
Treadco, Goodyear Team Up for Truck Tires
Treadco, a truck tire subsidiary of trucking and intermodal firm Arkansas Best Corp., said it has entered into a joint venture agreement with Goodyear to combine commercial tire service centers into a shared network for truck tire sales, service and retreading. Good-year separately said this would be a major expansion of its presence in the trucking industry.
The joint venture, Wingfoot Commercial Tire Systems LLC, will serve existing Treadco and Goodyear customers with a U.S. network of 194 service centers and 77 retreading plants.
Treadco President and Chief Executive Officer John Meyers will serve as chairman and CEO of Wingfoot, while Michael Thomann, current Goodyear marketing director for commercial tires, will be Wingfoot's president and chief operating officer.
Under terms of the agreement, Goodyear with hold about 60% ownership interest and Treadco approximately 40%. The transaction is expect to close by Oct. 31 and is subject to approval by the Federal Trade Commission. Transport Topics
Components Supplier Dana Expects 3Q to Fall Below Estimates
Dana Corp., maker of engines and other heavy-truck components, said Monday it expects third quarter earnings within range of 41 to 46 cents per share, well below the current consensus estimate of 86 cents per share.Like many other truck-related manufacturers, the weak North American truck market is partly to blame for Dana's lower earnings. The company also cited production cutbacks of light trucks and sport utility vehicles by Ford and other Dana customers, as well as a soft U.S. and European aftermarket, as reasons for the less-than-expected earnings.
Dana Chairman and Chief Executive Officer Joe Magliochetti said the company's outlook also remains "guarded" for the fourth quarter. Transport Topics
GM, Isuzu Form Joint Commercial Vehicle Sales/Service Venture
General Motors and Isuzu Motors have announced a joint venture to sell and service commercial vehicles, Bloomberg reported.American Isuzu Motors is to hold 51% of the joint venture and GM the remaining 49%; GM also holds 49% of Isuzu Motors. GM and Isuzu also operate a joint diesel engine plant in Ohio, the article said.
This joint venture is meant to help GM and American Isuzu compete with U.S. and interna-tional rivals that build and sell commercial vehicles, the companies said in their announcement. Transport Topics
Canadian Drivers May Halt Deliveries; Protests Continue Elsewhere
Canadian drivers will stop deliveries at the end of this week if their government does not find a way to provide relief from high diesel prices, Bloomberg reported Monday.The president of the National Truckers' Association, representing 5,000 Canadian drivers, threatened the delivery stoppage Sunday but held off calling for members to set up blockades like those halting European traffic, the article said.
The news out of Australia is not all about Olympic gold, silver and bronze medals, as that country's truckers may blockade fuel stations and oil refineries, Bloomberg reported. Angered by rising fuel costs, the truckers may decide by Tuesday to form blockades, an official from the 100,000-member Transport Workers Union said in the article.
Reports out of Europe were not much better. Protests continued in Spain, Slovenia and Sweden, Reuters reported. Norwegian drivers had blockaded several fuel terminals over the weekend, but called it off, Bloomberg noted. Germany and Ireland were both relatively quiet by Monday, as protests have been called off while the respective governments discuss ways to relieve fuel prices, the Reuters report said. Transport Topics
Transit Group Says Lenders Gave 30-Day Extension
Altanta-based Transit Group Inc., a holding company that consolidates mostly truckload-focused trucking firms, said Friday its lenders gave it a 30-day extension of a waiver for the company being out of compliance with some of its credit covenants.The extension to Oct. 15 allows negotiations to continue on amending the credit terms "in a way that will allow Transit Group to operate in the current industry environment," the company said. Transit added that it has not been in compliance since March 31.
Through affiliates and agents, Transit says it offers shipping services in most of the continental United States and Canada. Transport Topics
SoCal Air Regulators Back Off From Early Clean-Diesel Rules
The South Coast (Calif.) Air Quality Management District voted unanimously Friday to push back a rule that would have required cleaner-burning diesel two years ahead of federal requirements, the Associated Press reports.Although that district had been rated for several years as having the worst air pollution in the country, it pushed back the start on the clean-diesel rules from 2004 to 2006, the Environmental Protection Agency's deadline, the article said.
The ruling will require diesel fuel to have a sulfur content of no more than 15 parts per million (ppm) by the 2006 deadline; the sulfur level in California is currently around 120 ppm, according to the AP. Transport Topics
Port of Los Angeles Now Uses "Green" Cargo Movers
The Evergreen America Corp. container terminal operated by Marine Terminals Corp. is now using five liquid petroleum gas (LPG) yard hustlers to move cargo at the Port of Los Angeles, it was announced Friday.The yard hustlers can move 55,000 pounds of cargo while running on LPG, which has lower emissions than diesel fuel. MTC purchased them with help from California's Carl Moyer Memorial Air Quality Standards Attainment Program, which covers the additional cost of using the alternative fuel rather than diesel. Transport Topics
Headlines From Friday's P.M. Briefing
- Crude Oil Price Up on Iraq, Kuwait and Possible Hurricane
- Navistar May Move Headquarters from Chicago to Suburbs
- Texas Forced to Divert Federal Highway Funds to Safety
- Volkswagon Plans Stock Buyback, May Use Those Funds to Buy Truck Maker
- GPS Data Used as Evidence in Canada Court Case
- Ga. Ports Authority Shows Off Speedier Processing
- Electric Fuel Corp. to Develop Electric Hybrid Vehicle for Germany
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