Executive Briefing - April 13
- OTR Express Expects Big Q1 Loss
- Group Forecasts 5% Unemployment This Fall
- IEA Warns of High Gas Prices
- Toyota to Increase Hino Stake
- Intermodal Traffic Fell 3.1% Last Week
- States Focus on Cell Phone Legislation
A NAME="story5">
OTR Express Expects Big Q1 Loss
Transportation company OTR Express (OTR) said that it expects to report a significant loss for the first quarter of 2001, and that it has made significant progress in downsizing its fleet.The loss is a result of a softer freight market, high fuel costs, and costs related to downsizing.
The Olathe, Kan.-based company said it is in talks with its four largest equipment lenders to modify terms of its debt and improve cash flow. Transport Topics
Group Forecasts 5% Unemployment This Fall
In another warning that may affect the future earnings of trucking companies, the National Federation of Independent Businesses told the Wall Street Journal that unemployment could reach 5% this fall.In March, unemployment stood at 4.3%, the highest level since 1997.
A sharp rise in unemployment is a signal that the economy is deteriorating. It also will hurt consumer confidence, which means Americans will buy fewer products, slumping truck shipments.
The NFIB is the largest lobbying group of small-businesses. It used data from its monthly survey to arrive at the 5% estimation. Transport Topics
IEA Warns of High Gas Prices
The International Energy Agency says North American drivers are likely to face spikes in gasoline prices as a result of low crude oil inventories, the Associated Press reported.The Paris-based agency, which is part of the Organization for Economic Cooperation and Development, said it widely expected that U.S. gasoline markets will be very tight this summer.
The editor of the IEA’s monthly energy report Klaus Rehag said the problem would be exacerbated by a new round of production cuts undertaken by the Organization of Petroleum Exporting Countries.
Diego Saltes, an economist with the Economics and Statistics Group of the American Trucking Associations, told Transport Topics the likelihood of volatile gasoline prices is high because no significant rebound has taken place to recover from 10-year lows in gasoline stocks experienced last year. Transport Topics
Toyota to Increase Hino Stake
Toyota Motor Corp. plans to increase its stake in Hino Motors, Japan's largest truck maker, and make it a full subsidiary, according to a Nihon Keizai News article reported by Bloomberg on Friday.
Currently, Toyota owns a 37% stake in Hino and buys one-third of its vehicles. It is hoping to raise its stake to more than 50%.
Reuters reported that Toyota is planning to shift its light truck operations to Hino.
f the transaction goes through, Toyota's current vice-president, Tadaaki Jagawa, would head Hino, Bloomberg reported. Transport Topics
Intermodal Traffic Fell 3.1% Last Week
Intermodal traffic for truck-rail freight loads at major U.S. railroads dropped 3.1% for the week ending April 7, to a total of 171,333 units from 176,796 during the same week in 2000, the Association of American Railroads reported.Since early March, freight loads have been decreasing with the slowing economy. Overall, this year’s intermodal traffic has been well below 2000 levels.
This was the second straight week traffic dropped 3.1%.
When reported separately, the number of truck trailers moved by railroads dropped 7.6% last week, while the number of containers dropped 0.9%. Trailers include only domestic loads. Containers, on the other hand, may also include international shipments.
Railroads reporting to AAR account for 98% of U.S. rail intermodal volume. Transport Topics
States Focus on Cell Phone Legislation
The National Conference of State Legislatures in Denver said there are about 100 bills pending in 40 states dealing with the use of cell phones while driving, the San Jose Mercury News reported.The most common safety proposal is requiring a driver to use a headset. However, the article noted there is no evidence that using a hands-free device reduces the risk of an accident.
In fact, there is also no evidence that using cell phones actually increase the number traffic accidents.
But Donald Redelmeier, a professor at the University of Toronto and co-author of a 1997 article analyzing traffic accidents, said an average of two people are killed in the United States each day because of accidents caused by cell phone use.
That is less than 2% of the total number of people killed each year in vehicle accidents. Transport Topics
