A.M. Executive Briefing - Sept. 19
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Diesel Price Continues to Soar; Sets New Record
Despite price drops in California and the West Coast region, the national average diesel price jumped 2.4 cents last week to $1.653 per gallon, the U.S. Energy Information Administration reported.That is the highest since the EIA began this data series in March 1994, but an agency official said historical comparisons also show this to be the highest nominal diesel price in the country's history.
Regionally, the biggest increase was again in the Rocky Mountains, where diesel went up 3.9 cents, the report said.
FedEx's 1Q Profit Grows; Postal Alliance Plan Questioned
Overnight delivery giant FedEx Corp. saw a fiscal first quarter profit of 6.3%, thanks to a strong increase in worldwide shipping, Bloomberg reported Tuesday.Net income for the quarter was $169 million or 58 cents per share, up from $159 million or 52 cents in the same period of 1999, the article said, and topping the 54-cent consensus estimate of Wall Street analysts compiled by First Call/Thomson Financial. Revenue also increased 11% to 4.78 billion for the quarter, Bloomberg noted.
The company said its international shipments grew 14%, while deliveries in the United States rose 4.1%.
Separately, The Wall Street Journal reported Tuesday that U.S. Rep. Henry Hyde, chairman of the House Judiciary Committee, has asked the Justice Department to investigate FedEx's possible alliance with the U.S. Postal Service for potential antitrust concerns. Transport Topics
Protests Continue in Europe, Spread to Middle East
Truckers, farmers and others angry at the high cost of fuel continued blockades in Sweden and Spain, while discontent also spread to the Middle East as Israeli truckers began protesting, news agencies reported Tuesday.Harbors, ports, rail terminals and fuel stations were blockaded in Sweden and Spain, and protests could intensify over the next few days, the Associated Press reported.
Israeli truckers staged a "go-slow" convoy along a main north-south highway, between the ports of Haifa and Ashdod, Reuters noted. Transport Topics
Parts Supplier Rockwell Warns of Lower-Than-Expected 4Q
Rockwell International Corp., whose various products include truck parts, said Monday it expects fiscal fourth-quarter profits below current analysts' estimates, due to less demand from the truck- and auto-making sectors, Bloomberg reports.The company expects earnings for the year of $3.35 per share, nine cents below the analysts' consensus by First Call/Thomson Financial, the article said. Rockwell also expects fourth-quarter sales to drop 5% from the same period last year, according to Bloomberg.
Dana Corp. and Eaton Corp., which also supply parts to the truck making industry, also announced Monday they both expect earnings below current estimates, Transport Topics had reported. Transport Topics
Western Star Shareholders OK Freightliner Deal; Dina Contract Reported Dropped
Shareholders of Western Star Truck Holdings approved the company's purchase by Daimler-Chrysler truck-making subsidiary Freightliner, Bloomberg reports.The purchase price is C$670 million (US$450 million), and DaimlerChrysler agreed to pay C$42 per share for outstanding shares of Western Star, Bloomber noted. The transaction is expected to be completed by Sept. 26.
Freightliner has also decided to end a truck-production agreement between Western Star and Mexico's Grupo Dina, which has been providing commercial trucks to be sold under the Western Star name, according to a Stark's News Service report cited in the Bloomberg article. Transport Topics
DaimlerChrysler Wants Chinese Partner
DaimlerChrysler is in talks with several Chinese truck makers with hopes of taking advantage of projected growth in that market, Bloomberg reported Tuesday.The company expects China's truck market to grow in 10 years to twice the size of Japan's, where truck sales dropped 40% last year but should rise again this year, Bloomberg said.
While DaimlerChrysler did not specify the companies it was talking to, the report noted that First Automotive Works, Second Automotive Works and Chongqing Changan Autombile Co. are China's main vehicle makers. Transport Topics
Continental Announces Tire Recall
Continental AG, the German company that is the world's fourth-largest tire maker, said it would recall 150,000 tires supplied for Ford's Lincoln Navigator sport-utility vehicles for tread-separation issues. Its shares then fell 8% to 18.7 euros, Bloomberg reported Tuesday.Continental and Ford are appearing before the National Highway Traffic Safety Administration Tuesday to testify about the tires, which have been linked to several non-fatal accidents. The recall is expected to cost Continental between $4-6 million, according to Bloomberg. Transport Topics
Supplier Federal-Mogul Changes Leadership; Warns on 3Q Earnings
Automotive and heavy-duty parts manufacturer Federal-Mogul is the latest victim of the North American market crunch, announcing an executive change as well as a reduction of its third-quarter earnings estimate.The company said its chairman, chief executive officer and president, Richard Snell, has stepped down from those positions effective immediately. Robert Miller Jr., a current Federal-Mogul director, will take over as chairman and interim CEO.
Federal-Mogul also said it expects third-quarter earnings to fall below analysts' estimates, which it attributes in part to weakness among its customers. Transport Topics
Intrenet's Roadrunner Unit Finishes Trailer Fleet Change
Roadrunner Distribution Services, a subsidiary of trucking firm Intrenet Inc., has received its final delivery in a 200-trailer order from Great Dane, the company said Tuesday.Roadrunner has now converted its entire fleet to Great Dane's 53-foot air ride vans, which the company said will give customers more loading space and reduce risk of cargo damage.
Parent company Intrenet operates a large North American flatbed fleet as well as several other trucking subsidiaries. Transport Topics
Headlines From Yesterday's P.M. Briefing
- Gordon Drenches Florida, Will Move Up I-95 Corridor
- Eaton Expects Lower 3Q Results
- Former Oliver Transportation Employees Settle Charges
- Oil Vaults Past $36 Mark
- EGL Shareholders Approve Circle Merger
- Georgia Updates Rest Stops, Adds More Truck Parking
- TransPro Nixes Quarterly Dividend
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