A.M. Executive Briefing - Sept. 21
This Morning's Headlines:
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UPS Says It Plans Stock-Market Debut In Early November
On Friday, United Parcel Service of America gave the Securities and Exchange Commission a tentative proxy and a revised registration statement saying the company intends to make its planned IPO early in November. Unnamed sources say UPS wants the filing approved as soon as this week; if it is approved, shareholder and investor meetings will begin next month.After the IPO the company will change its name to United Parcel Service Inc. and be listed on the New York Stock Exchange. Previous to the IPO, the company intends a 2-for-1 stock split for its outstanding shares. Numerous analysts think it is probable the offering price could be $70 a share, which is the hypothetical pre-split price UPS used in one of the filings. Wall Street Journal (09/21/99) P. C24; Blackmon, Douglas A.
CSX, NS Restore Service in NY-NJ Area
CSX Transportation and Norfolk Southern are beginning to clear out a backup of 1,000 containers or more from the Port of New York-New Jersey as the railroads have brought back service to the metropolitan area. However, the railroads are still delayed or detoured around some routes between Georgia and Virginia, in North Carolina, and in New Jersey due to hurricane flooding.In the eastern portion of North Carolina, close to 300 roads are still shut down. Among them are I-95 and I-40. Trucks on I-95 in the area are being detoured on smaller roads through Raleigh. Journal of Commerce Online (09/21/99); Watson, Rip
Charges Certified Against Trucker
On Monday, General District Judge Edward Kidd of Montgomery County, Va., certified charges of involuntary manslaughter against FMI Express trucker Richard Wayne West, 31, of Pulaski, Tenn. On May 26, West's truck went through a guardrail and across a median south of I-81 exit 114 near Christiansburg, Va., crushing a car and killing its occupants, an elderly couple from Liverpool, N.Y. West said to the state police that he had lost control after unfastening his safety belt and reaching to get a drink.In the preliminary hearing on the matter, Peggy Frank, assistant commonwealth's attorney, said, "I think the court can agree that someone looking away and reaching for a drink in a small automobile is different from someone driving a tractor-trailer," and added that the trucker did not hit the brakes or perform "corrective action." William Cleaveland, defense attorney, argued that the commonwealth's attorney had not proven what the trucker had done did not come up "to the level of criminal negligence." But the judge said he thought "the criminal negligence occurs when he unbuckles his seat belt and reaches for a drink."
West was also convicted of reckless driving, and the judge fined him $1,000 and six months in jail. West is going to appeal. Roanoke Times Online (09/21/99); Sluss, Michael
Nissan to Boost Truck Sales Unit
Nissan Motor and truckmaker Nissan Diesel Motor say they are going to put $425 million into the Nissan Diesel Sales unit, both to help the sales company due to lower Asian sales and to help out the planned January merger of Nissan Diesel Motor and Nissan Diesel Sales. Nissan Diesel Motor recently lowered its profits estimate for the fiscal year ending in March. No one is yet sure how this will affect Renault's plans for its 22.5 percent share in Nissan Diesel Motor and 36.8 percent share of Nissan Motor. Nissan Diesel Motor is being negatively affected by lower investments, poor sales, and interest-bearing liabilities. Financial Times (09/21/99) P. 24; Harney, AlexandraAlt-Fuel Mandate Threat Seen in California's SCAQMD 'Toxics' Plan
The South Coast Air Quality Management District, in the Los Angeles Area, is to present in the spring a "toxics control" plan for $25 million spending on funds for distributing alternative fuels and altering engines to use them. One of the programs supports compressed natural gas, liquid natural gas, or electric instead of clean-diesel fuel. The plan might also make fleets in the area begin using clean fuels without funding the purchases through tax revenue.Officials at the SCAQMD say part of this plan might ask the California Air Resources Board to mandate cleaner diesel fuel. The SCAQMD is acting on its study results which contend that "[h]eavy-duty trucks and buses across the state account for only 2 percent of all the on-road vehicles but emit about 25 percent of the nitrogen oxides and 70 percent of the directly emitted particulates from on-road sources." But another study in Denver in 1998 found that cars running on gasoline create three times as much particulate matter as trucks burning diesel fuel.
Stephanie Williams, environmental director at the California Trucking Association, charges that the SCAQMD "doesn't want to go after stationary sources any further, so they are creating the 'diesel devil.'" Williams also says L.A. area trucking companies might not be able to compete with companies elsewhere that can continue to use older trucks and less expensive diesel fuel.
In related news, perhaps in October a lawsuit will be filed against the California Air Resources Board over the board's determination of diesel exhaust to be a "toxic air contaminant," says Williams. She also says her association will try to get state lawmakers to favor getting rid of older and dirtier trucks that use diesel, rather than paying for altering fleets to use compressed natural gas. Diesel Fuel News Online (09/20/99); Peckham, Jack
USFreightways Can't Explain Stock Drop
Neither USFreightways nor analysts at Merrill Lynch and Donaldson Lufkin & Jenrette can explain why the carrier's stock dropped 2.875 to 43.1875 Monday. Asked if the company had anticipated putting out news in the week, spokesman Kenneth Ball said, "There is nothing that would make the stock move."In other news, J.B. Hunt Transport Services fell 0.875 to 13.125. Analyst Peter Coleman of Banc of America Securities had downgraded the J.B. Hunt stock's rating from buy to market perform after the carrier's Friday announcement that it would not meet third-quarter earnings expectations. Other transportation stocks that went down Monday were Yellow Corp., down 0.5 to 15.625, and CNF Transportation, down 0.3125 to 42.5. Reuters (09/20/99)
Canada Lacks Rules to End Deadly Truck 'Underrides'
While Transport Canada found in 1997 that some 30 people annually die due to underrides in Canada, the country's government does not yet mandate the addition of underride guards. The 1997 analysis of databases found that 88 percent of underrides caused fatalities.Transport Canada says it is putting together a underride-guard requirement not unlike the one from the U.S. National Highway Traffic Safety Administration that went into effect in January of last year. But Byron Bloch, an auto safety consultant, says the U.S. law should have set the height limit for underride guards lower in the interest of small vehicles. He says the lower limit was recommended by NHTSA research.
Transport Canada expects to put out a draft proposal by April, and it is looking into a lower height limit. The agency has put the per-trailer price of underride guards between C$100 and C$200. Montreal Gazette (09/20/99) P. A10; McGregor, Glen/i>
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