A.M. Executive Briefing - Sept. 8
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Volvo Recalls 18,000 Trucks for Brake Problems
Volvo, the No. 2 truck maker worldwide, will recall 18,000 trucks in North America equipped with faulty Bendix antilock brake systems, Bloomberg reported.Volvo Trucks North America also issued a statement spelling steps it will take to speed the repair process for affected trucks.
Honeywell International, which makes the Bendix brake units, had urged truck and bus makers using its systems to recall those vehicles to correct the problem. The antilock brakes have been found to lose braking ability for short periods when traveling at 20 miles per hour or less, due to a sensor that can misread signals from the wheels, Bloomberg said. Volvo has received five reports of incidents connected with its trucks using that brake system, Bloomberg noted.
Marc Gustafson, Volvo Trucks North America's president and chief executive officer, also said the company would "make sure customers' trucks in the most critical applications are repaired first, to minimize risks to drivers and the public." Transport Topics
DaimlerChrysler Names Mitsubishi COO, Cuts Cost of Its Investment
DaimlerChrysler has increased its influence in vehicle manufacturer Mitsubishi Motors by appointing a 30-year Daimler veteran, Rolf Eckrodt, to take the second-highest position of chief operating officer at the Japanese company, news services reported.The two companies also said that DaimlerChrysler renegotiated its previous investment terms to pay 10% less for its 34% stake in Mitsubishi, which was hit with a criminal complaint from the Japanese government Friday, various news sources reported.
For days, reports had surfaced that DaimlerChrysler was trying to negotiate a higher share of the troubled Mitsubishi; at least one report while the talks were under way had said they agreed to a 40% share instead of the 34%. However, under the new terms officially announced, DaimlerChrysler will be able to boost its stake in three years instead of waiting 10 years as the previous agreement required.
This appointment comes as current Mitsubishi President Katsuhiko Kawasoe announced he would resign to take responsibility for a defect cover-up scandal that has rocked the company, the Associated Press reported. His sucessor will be Takashi Sonobe, a Mitsubishi vice president with long experience in the U.S. market, including chairman of Mitsubishi's U.S. manufacturing and sales, AP said. Transport Topics
Clinton Warns of Recession Risk From High Oil Price
With oil ministers from the international consortium of producing nations about to meet to reconsider their output levels with prices at 10-year highs, U.S. President Clinton is warning that continued high oil prices could tip the still-strong U.S. economy into a recession.To some parts of the trucking industry, that could already be happening. Various truck and parts makers in North America and elsewhere have been cutting production and laying off workers due to slumping demand from truck users. There have also been sharp declines in value of used trucks, which backs the collateral of loans to many companies and independent drivers, and cutbacks among truck parts-supply stores.
Clinton said he warned about recession risk for this country and elsewhere in the world when he met Thursday in New York with Saudi Arabian Crown Price Abdullah at the United Nations Millenium Summit, the Associated Press reported.
The Wall Street Journal reported Friday that someone familiar with the Clinton-Abdullah talks said Abdullah had assured Clinton that Saudia Arabia will pump enough oil beyond OPEC levels to get prices down. Transport Topics
U.K. Truckers Stage Blockade; French May Soon End Theirs
Farmers and truckers in the U.K. blockaded Royal Dutch/Shell's refinery in northwest England for almost six hours, before police dispelled the crowd, according to a Sky News report on the Bloomberg news service.Meanwhile, France's National Federation of Road Transporters (FNTR) called on its members to end their six-day blockade in that country, as it has received assurances from the French government that it will help quell rising fuel costs, Bloomberg reported.
However, UNOSTRA, the second-largest truckers group, said it would likely continue the protests, according to the report. Thanks to the blockade, 80% of gasoline stations have run out of at least one type of gas, French radio France Info said. Transport Topics
UPS Issues Response to FedEx/USPS Alliance
UPS released a statement late Thursday concerning the possible alliance between it's competitor, FedEx, and the U.S. Postal Service.UPS said in its statement that the alliance would help both FedEx and the Postal Service overcome recognized "shortcomings" and "deficiencies" in their respective services, but questioned the legality of the proposal.
"From a public policy standpoint, this is like having the Department of Agriculture partner with Burger King to the exclusion of McDonald's," the statement read. "A federal government agency should not be allowed to favor one competitor over another, particularly when this agency has a $40 billion government-granted monopoly from First Class mail that it can use to compete unfairly in the marketplace with private carriers."
The statement further noted that Congress and the Postal Rate Commission were likely to look into the proposal, saying "this is far from a done deal, considering the public policy and antitrust implications." Transport Topics
Teamsters Deliver Gore Endorsement, as Expected
Just as the latest opinion polls show the U.S. presidential election either in a dead heat or with Democrat Al Gore maintaining an edge he gained at sunmmer's end over Republican George W. Bush, the Teamsters union executive board on Thursday did what was widely expected and gave Gore its backing, according to the New York Times.Union President James Hoffa said the decision was easy and that he had pushed his board to back Vice President Gore after Gore began addressing issues important to working families, the Times noted. Various news agencies had reported that the Gore endorsement was likely.
This major transportation workers union backed Republicans for president during the 1980s, endorsed Democrat Bill Clinton in 1992 and no one in 1996. This year it waited until long after most other unions, while it was courted by both major parties and some minor ones. Transport Topics
Intermodal Traffic Strong in August
Rail intermodal traffic continued to rise last week, as it did for the entire month of August, the Association of American Railroads reported Thursday. That's good news for trucking companies that haul containers and trailers for part of their journeys.Intermodal traffic totaled 193,827 trailers and containers last week, a 4% increase from the same week in 1999, AAR said. Trailers dropped 13.4% to 59,779, while containers rose 14.3% to 134,048 units.
For all of August, intermodal traffic totaled 32,429 units, a 3.6% increase over 1999, according to AAR. The association's vice president, Craig Rockey, said that with the peak shipping season approaching AAR expects railroads to set a fourth-straight intermodal record in 2000.
Railroads reporting to AAR account for 98% of the country's rail intermodal volume. Transport Topics
Internal Chart Should Have Warned Firestone, New York Times Says
Congressional investigators found documents showing that Bridgestone/Firestone tire company officials were briefed in February by their own sales staff members on rising warranty costs for the tires, the New York Times reported. Those tires have been linked to numerous fatal accidents and triggered a massive recall.However, Firestone officials told regulators as well as the Ford Motor Co., which used the tires on its Explorer models, that the tires were not problematic. The Times explained that the documents were distributed to members of Congress in preparation for a hearing Wednesday, but were not actually discussed during the proceeding.
The documents included a chart prepared for the sales staff annual meeting in February - with a label on one chart reading "separations increasing" in large, underlined letters, the Times reported.
Meanwhile, parent company Bridgestone Corp. shares fell 12%, to their lowest level in eight years, Bloomberg reported , after the U.S. Justice Department said it may launch an investigation into the recall. Transport Topics
Senate Votes Against Curbing Mo. River Barging
In a long-running fight that could have strong implications for trucking across the Great Plains region, the U.S. Senate voted Thursday to block federal agencies from implementing a plan that would curb barging on the Missouri River, the Associated Press reported.The Senate vote retains legislative, in a major funding bill for energy and water projects, that prevents agencies from adopting a plan to boost spring water releases from dams in Montana and the Dakotas in order to help rare birds and fish. Commercial interests in maintaining a navigable barge channel from northern Nebraska to St. Louis have fought the plan, saying a spring surge would disrupt what is already a restricted barging season.
The issue pits upstream states against those downstream. States holding the upstream lakes and dams want the water for their recreation and irrigation; downstream they see the Missouri River as an important piece of commerce that keeps some freight off busy highways and feeds commerce at various inland ports.
If the Missouri river traffic were further curbed, some say it would be enough to kill that type of freight ransport, throwing more volumes of barged commodities onto long-distance rail and regional trucking across Nebraska, Iowa, Kansas and Missouri. This fight has gone on for years and is hardly over with the Senate vote. President Clinton has threatened a veto of this bill, AP said, and the spring surge plan could still end up in a final bill. Transport Topics
Headlines From Yesterday's P.M. Briefing
- Former Interim Head of Emery Worldwide Is New CEO
- Fuel Situation Worsens in France From Truck Blockade
- Emons Reports Fourth-Quarter Drop, Record Yearly Earnings
- Mitsubishi Again Recalls Japan Minicabs; Volvo Confirms Talks
- Grupo Dina Begins Cutback
- FedEx Ground Names Gershultz Senior VP for Operations
- Peapod Buys Streamline.com's Chicago, D.C. Operations; Exits Some Markets
- Ford Will Build New Manufacturing-Distribution Complex
- Peterbilt Truck Accessories Catalog Now Available On-line
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