Executive Briefing - April 5
- Dutch Truck Driver Jailed for Manslaughter
- Comair Cancels Flights Through April 13
- March U.S. Layoffs Surged
- MAN's Profit to Fall on Higher Truck Costs
- Kuwait: OPEC May Cut Oil Output Again
- Old Dominion Expects Lower Profits
- Calif. Economy Seen Worse Than Expected
- Haldex to Make Four-Wheel Drives for U.S. Automaker
- Slowdown Hurting Fedex's Profits
- Budget Group Secures Truck, Car Fleet Funding
- Wisconsin Central Shareholders Approve Canadian National Merger
Dutch Truck Driver Jailed for Manslaughter
A British judge has sentenced a Dutch truck driver to 14 years in jail after being found guilty of manslaughter, Reuters reported.The driver, Perry Wacker of Rotterdam, Netherlands, was smuggling illegal Chinese immigrants into Britain last June. During the journey from Holland, 58 of the 60 immigrants died after suffocating in the airtight container they were traveling in.
Walker’s partner, Ying Guo, who worked as the Chinese interpreter, was convicted of conspiracy and sentenced to six years in prison. Transport Topics
Comair Cancels Flights Through April 13
Comair said it is canceling all flights through the morning of April 13 as the strike by its pilots moves toward a third week with no talks scheduled, Bloomberg reported.
Comair is the second-largest regional airline and is owned by Delta Air Lines (DAL).
The walkout is expected to reduce Delta’s quarterly earnings by an estimated 1-2 cents per share. Delta is also facing a strike by its own 10,000 pilots on April 29. Transport Topics
March U.S. Layoffs Surged
In its latest monthly report on how many jobs are eliminated by U.S. companies, international outplacement firm Challenger, Gray & Christmas said the March total was almost triple the same month in 2000.Some of those cuts have hit freight haulers and truck equipment producers, but those that hit trucking customers usually brought with them output cuts that would further weaken freight shipments in the months ahead.
Challenger tabulated that U.S. firms announced 162,867 layoffs in March, up from 55,783 a year earlier. That was before the Federal Reserve's hikes in interest rates and the oil cartel's hikes in energy prices left the economy limping at or near recession levels.
March was the fourth straight month in which job cuts topped 100,000, Reuters noted. It was up 60% from February and made March the highest job-cut month since the survey began in 1993. Transport Topics
MAN's Profit to Fall on Higher Truck Costs
MAN AG, Germany's second-largest truck maker, said its 2001 profits will drop as much as 10% as European demand for new vehicles falls and production costs rise, Bloomberg reported.img src="/sites/default/files/images/articles/manlogo.gif" width=54 align=right>The company, which gets 40% of sales from heavy trucks, said workers have been slower than expected to learn a new manufacturing method.
hat is a main reason Chief Executive Rudolf Rupprecht estimated pretax profit may decline as much as $59 million.
MAN, which also makes diesel engines and printing presses, said last week it will cut 1,200 jobs. Transport Topics
Kuwait: OPEC May Cut Oil Output Again
Kuwait's oil minister said Thursday that the Organization of Petroleum Exporting Countries may cut oil production for the third time this year, Bloomberg reported from a KUNA news agency article.The oil minister did not comment on the size of the possible cut, which the cartel would decide on when it meets in June. However, the cartel has an informal agreement to cut oil production by 500,000 per day whenever oil prices fall below $22 per barrel for 10 consecutive days.
Despite an earlier agreement to cut output by a total of 2.5 million barrels per day, OPEC oil production has risen 1.5% to 420,000 barrels per day.
This is mainly because Iraq is recovering from a three-month low it reached in December following a dispute with the United Nations. The United Nations has been monitoring Iraqi oil production since Iraq invaded Kuwait in 1990. Transport Topics
Old Dominion Expects Lower Profits
Old Dominion Freight Line (ODFL) said it expects first-quarter earnings to be in the range of 8-12 cents per share, well below the 28 cents per share it posted during the first quarter of 2000, Bloomberg reported.
Chairman Earl Congdon blamed the slowing economy that is affecting the entire transportation industry and costs related to its acquisition of Carter & Sons Freightways for the lower earnings.
In addition, Congdon hinted that his revenue target of 10-15% for 2001 may be difficult to obtain.
Old Dominion Freight Line is ranked No. 37 in the Transport Topics 100 list of U.S. trucking companies, based on 1999 data. Transport Topics
(Click here for the full press release.)
Calif. Economy Seen Worse Than Expected
The economy of California, which is a large chunk of the overall U.S. economy and a major freight market for trucking, will probably suffer a worse slowdown than previously expected, the Wall Street Journal reported Thursday.The Journal said a report from the University of California at Los Angeles has raised its risk for a national recession to 90% from 60% in December, and now expects the state's economy to come within a single percentage point of negative growth.
The report sees the California slump as running deeper and longer than earlier thought, both because of the power crisis that has hit the state recently and the still-spreading weakness in many technology companies based there.
That can affect trucking from several directions. California's large consumer market and numerous manufacturers generate a lot of shipments in themselves and any weakness there will dent shipments. And the state is a key terminus for cross-country freight shipments to link up with the largest U.S. ocean container ports at Long Beach and Los Angeles. Transport Topics
Haldex to Make Four-Wheel Drives for U.S. Automaker
wedish company Haldex AB said late Wednesday that it received a $146 million order to make four-wheel drives for a major U.S. automaker, Bloomberg reported. The company did not identify the automaker.
Four-wheel drives are built into sport-utility vehicles and pick-up trucks that utilities and other specialty commercial fleets use for hauling light cargo.
Haldex plans to begin delivering the systems in 2003. The five-year contract is the company's first U.S. order for the part. Transport Topics
(Click here for full press release.)
Slowdown Hurting Fedex's Profits
FedEx (FDX) said late Wednesday it now expects earnings for the quarter ending May 31 to be lower than its previous estimates.
The Memphis, Tenn.-based company said that U.S. domestic express package volume declined an estimated 4.4% in March compared to the year before, which is much larger than expected.
If this decline continues, Chief Financial Officer Alan Graf said it would be unlikely the company could meet its forecast of 85-90 cents per share. According to Reuters, analysts had only been predicting 82 cents per share.
Fedex is ranked No. 2 in the Transport Topics 100 list of U.S. trucking companies, based on 1999 data. Transport Topics
(Click here for the full press release.)
Budget Group Secures Truck, Car Fleet Funding
Budget Group (BD), which bills itself as the world's third-largest car and truck rental system through its Ryder TRS and Budget Rent a Car units, said it has secured a $350 million asset-backed financing deal to fund its acquisition of vehicles for the peak rental season.Budget said getting that credit line "is another milestone in the company's multi-step financing plan to fund its fleet needs for 2001 and beyond."
Earlier this year, it received an amendment to its revolving credit for fleet financings that restored availability up to $550 million. And Budget is currently undertaking a placement of $400 million in asset-backed, medium-term notes that it says should be completed in mid-April. All these will replace debt that matures over the next 10 months. Transport Topics
(Click here for full press release.)
Wisconsin Central Approves Canadian National Merger
Railroad company Wisconsin Central Transportation Corporation said Wednesday that its shareholders approved a merger plan with a subsidiary of Canadian National Railway Company.Railroads and trucks work together since railroads carry intermodal trailers, but they also compete for some types of freight business. So trucking can be quickly affected by changes within the rail system.
WCTC operates about 2,800 route miles of railway serving Wisconsin, Illinois, Minnesota, Michigan's Upper Peninsula, and Ontario, Canada.
CN operates a network of more than 15,700 route miles in Canada and the United States. Transport Topics
(Click here for full press release.)
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