A.M. Executive Briefing - Sept. 21
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Oil Price Falls After Gore Says Tap Reserve
Crude oil prices fell 3% this morning, Bloomberg reported, after Vice President Al Gore publicly urged President Clinton to tap the U.S. Strategic Petroleum Reserve to knock down fuel prices.Gore, in the midst of a presidential election race against Republican Gov. George W. Bush of Texas, said in a Maryland campaign event Thursday that he favors drawdowns from the SPR in batches of 5 million barrels, to be swapped to energy companies that would replenish the stocks later. Bush has criticized the administration for having a failed energy policy.
And the Journal said the Summers memo said the Department of Energy had advocated the sale of 60 million barrels from the reserve - far more than ever released in a single period.
The trucking industry has long favored an SPR release to knock down soaring motor fuel prices. American Trucking Associations President Walter McCormick on Wednesday led a delegation of industry leaders to press Energy Secretary Bill Richardson on the issue.
Meanwhile, high oil prices continue to spark protests in some European countries and are seen as a factor dragging the euro currency to record lows. The Group of Seven major industrial nations convenes one of its periodic summits this weekend amid growing calls for coordinated currency intervention to boost the euro, and a recent call by France for a special round of talks between major oil consumer countries and OPEC. Transport Topics
DaimlerChrysler Truck Profit Up, But Only Slightly
DaimlerChrysler expects its truck unit to post an increase in operating profit for the year, but the weak North American market will make that increase only a small one, Bloomberg reported Thursday. The company is the world's largest maker of commercial trucks.
North American truck sales fell 11% in the first eight months of 2000, a "low point of many years," commercial vehicles division head Dieter Zetsche said in the article.
A 7.6% overall increase was due to stronger demand in Europe, where Mercedes-Benz truck sales rose 4%, according to Bloomberg. Transport Topics
European Union Transport Ministers Can't Agree on Fuel Taxes
European Union transport ministers, meeting this week about the fuel tax protests across the continent, could not agree on a common strategy regarding fuel taxes, Bloomberg reported Thursday.The ministers did restate social and environmental concerns related to transportation but left any fuel tax strategy up to finance ministers, the article said.
France, currently holding EU's rotating presidency, issued a statement saying the commission would continue to look into "indirect taxation on fuel, remaining consistent with the objectives of the common transport and energy policies," Bloomberg also noted. Transport Topics
Ontario's Fuel Crisis Deepens
Breaking two days of silence about talks among the Ontario Trucking Association, the National Truckers Association and the Ontario government over skyrocketing fuel prices, OTA President David Bradley said late Wednesday the talks "have been productive … and the provincial government appears to be listening."The province has "hinted" that it might regulate fuel surcharges on freight rates "if shippers don't become part of the solution," he said in a statement.
OTA and NTA, both based in Ontario, caught the attention of the provincial government when NTA with its 1,800 owner-operators recently threatened to blockade fuel depots and main shipping arteries over recent fuel price hikes. Diesel fuel prices there have been around 79.2 cents (Canadian) per liter, which equals about C$3.81 per gallon or US$2.57.
About 400 NTA members then met Sept. 17 and decided to stall a decision on blockades. That followed on the heels of a meeting with OTA's directors at Truck World 2000 in Toronto Sept. 14. There, NTA asked for OTA's support on several issues, including the deepening fuel crisis in Ontario. But OTA's Bradley said in a press conference then that while OTA was empathetic to the plight of NTA members, "we are not on the same page on fuel tactics." OTA and the Canadian Trucking Alliance "won't be involved in public disobedience," he added.
Manitoba Minister of Highways and Government Services Steve Ashton jumped on the bandwagon late Wednesday with a statement excoriating the federal government for "passing the buck to provinces" on high fuel prices. "The federal government is posting multi-billion-dollar surpluses and actually benefiting from rising gas prices," he said. Margaret Gordetsky, Transport Topics
Circle Shareholders Approve EGL Merger
More than 99% of Circle shareholders voted in favor of a proposed merger with EGL Inc., the company announced Wednesday.Circle is a worldwide transportation, logistics and information-management company, while EGL is a provider of airfreight forwarding and other transportation and logistics services.
EGL shareholders had approved the merger Monday. The combined companies will operate as EGL Eagle Global Logistics. Transport Topics
Intrenet Completes Latest Information Technology Update
Intrenet Inc. announced Thursday it has completed the second phase of its "Common Freight Board" project, which will eventually provide load information for all Intrenet companies via computer.The second phase of the project links Intrenet subsidiaries Advanced Disttribution Systems and Eck Miller Transportation Corp., as well as their agents, providing those companies with Internet access to the Common Freight Board.
Phase three, scheduled for completion in November, will provide similar access for Roadrunner Trucking and its agents. Transport Topics
UPS Now Offers Web-based Return System
Retailers now can offer consumers who buy products from home a way to return goods using a Web-based automated return system.
The system being offered by United Parcel Service will allow both buyers and retailers to track the whereabouts of returns on the Internet. Companies can use the system to prevent products from being dropped on them without warning. The Electronic Returns product also will give consumers assurances that products are going to the right place and returns will be processed, UPS said.
Using the system buyers can log on to a Web site and indicate they want to send in a return. The site, which will be hosted through UPS' system, will allow consumers to print out a shipping label and affix it to the package to be returned. The Electronic Returns product is only useable for UPS deliveries, said Ross McCullough, UPS vice president of e-commerce.
Once the label is printed, the contents of the return are identified and products can be tracked throughout the journey back to the retailer. The system also will speed up the process for crediting buyers' accounts.
UPS will make money in two ways. It will sell access to the returns management system, and retailers that use the system will be driving their customers to UPS to ship the returns, McCullough said.
The Electronic Returns product is particularly timely given the approaching holiday season and holiday projections of $9 billion in online retail sales, UPS said.
Internet retailer Buy.com was the first company to sign up for the return service. Greg Hawkins, Buy.com's president said the product "has been instrumental in helping Buy.com build a perfect solution to take the hassle out of returns." Daniel L. Whitten, Transport Topics
Drug-Testing Consortium Operator Fined for Fraud
The head of a drug-testing firm in Vadnair, Minn. that defrauded "hundreds of trucking companies" was sentenced last month in a Minneapolis federal court to jail time and ordered to pay restitution, the Federal Motor Carrier Safety Administration announced on Wednesday.FMCSA said Raymond Kerr of drug-testing consortium Kerr Transportation Services had violated federal regulations for random drug testing of drivers.
Kerr operated the consortium for random drug and alcohol testing during 1995-97, but did not test drivers sent to him after collecting fees of $33-$55 each, FMCSA said. Because he sent letters to the drivers' companies falsely stating they were in compliance with USDOT he was charged with mail fraud.
Kerr had pleaded guilty on March 8. A U.S. District Court sentenced him Aug. 16 to 4 months jail time plus 36 months' supervised release, and he must pay back $8,641 in restitution. The agency wanted to make sure the information was known across the country, and so is now announcing it, an official said. Transport Topics
Drivers, Warehouse Workers May Strike West Coast Safeways
Truck drivers and warehouse workers serving the 245 Safeway supermarkets in parts of California, Nevada and Hawaii may go on strike, as their union has rejected a contract proposal from the company, the San Francisco Chronicle reported Thursday.The five-year contract currently in place between Summit Logistics, which runs a major Safeway distribution center, and Teamsters Local 439 expires at midnight Sept. 26, the article said. Summit President Martin Street said the rejected proposal was the company's "last, best offer," and no further talks have been scheduled, the Chronicle noted.
Safeway and Summit have both said any strike would not affect customers, as 450 replacement workers are being trained and a search is on for other temporary workers, the article said. Transport Topics
Headlines From Yesterday's P.M. Briefing
- DOE's Richardson: U.S. Attendance in Special Energy Meeting Up to Clinton
- Senate Committee Approves Legislation to Beef Up Tire Safety
- L.A. Transit Talks Resume as Strike Begins to Affect Businesses
- Spartech Says 4Q Will Fall Below Estimates
- PACCAR Will Buy Back Stock
- Aether to Buy Motient's Transportation Unit for Truck Software
- Arnold Logistics to Buy National Corporate Marketing
- TradeOut Says It Sold Over 500 Used Vehicles for Penske
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