P.M. Executive Briefing - Dec. 1
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DaimlerChrysler, Delphi Announce Factory Layoffs
Further weakening in the automotive production sector was shown by temporary layoffs at DaimlerChrysler (DCX) as well as Delphi Automotive Systems Corp. (DPH), CBS MarketWatch reported Friday.
DaimlerChrysler plans to shut 12 U.S. and Canadian plants for one week at a time over the next three weeks, trimming production by 50,000 units. This puts the company's count at 140,000 units below its original December plan, according to the news service.
Plants affected include a Windsor, Ontario, facility that makes Dodge full-size vans and wagons; a Newark, Del., facility that makes Dodge Durango truck and the St. Louis North facility making the Dodge Ram Quad Cab.
Delphi Automotive plans temporary layoff status for more than 1,700 hourly employees at facilities in Michigan, New York and Ohio, due to softening customer demand, the news service said. The layoffs come on the heels of 100 job cuts at a truck component plant in Michigan earlier this week.The shutdowns will likely impact carriers in the Midwest that haul auto components and completed vehicles. Transport Topics
Ford Cutting 1Q Truck Production by 4%
Ford Motor Co. (F) joined the procession of automakers planning production cutbacks, stating Friday that it would trim 113,000 units from its first quarter of next year, Reuters reported.However, truck production is expected to fall by only 4% or 33,000 units. Car production is expected to drop by 20%, the news service reported.
A several down days at the end of December in passenger car plants are also planned, according to Reuters. This will likely have an impact on trucking companies that carry components and auto haulers.Transport Topics
NAPM Survey Shows U.S. Factory Sector Weakening Further
A new report Friday by purchasing managers at manufacturing companies showed the U.S. factory sector continues to weaken, wire services noted. And since trucks haul a huge percentage of goods produced by factories, that portends more bad news for freight shipment activity in coming months.The National Association of Purchasing Management said its broadest index of several it compiles monthly on factory activity fell to 47.7 for November from October's 48.3. A reading above 50 shows the sector is still growing, but below 50 suggests the factory sector is contracting and this index has now been below 50 for four straight months.
Norbert Ore, who chairs the group's business survey committee, said while the latest report showed signs that the sector is stabilizing it also underscores that manufacturing has been hit harder by the U.S. economic slowdown than many other parts of the economy, Reuters reported.
He also said it was "a little ominous," Reuters noted, that orders at U.S. factories for export goods has now been below 50 for two months. Until recently, the crunch was in goods made for the domestic market while the foreign trade outlook remained solid. That can be a further caution for truck operators serving U.S. factories, especially those counting on the foreign-trade shipments. Transport Topics
Teamsters Voting on Summit Logistics Contract
A tentative contract was set to be voted on Friday by Teamsters Local 439 that could end a strike against a large warehouse run by Summit Logistics in Tracy, Calif., the Contra Costa Times reported Friday.If accepted, it could put workers back on the job as early as Monday - although the fate of 500 replacement workers handling goods bound for Safeway (SWY) grocery stores is not yet clear, the newspaper reported.
The contract under consideration would, among other things, cut pension contributions in half but guarantee a 50-cents-per hour pay raise each year for six years, the paper said.
Several Northern California Safeway stores have been picketed, and the job action has included arrests and allegations of violent acts by strikers. Teamsters are striking over long hours for truck drivers, inadequate breaks for workers in refrigerated areas and overloaded pallets. Transport Topics
Oil Expert Says Gas May Cost $3 a Gallon Next Summer
A top oil analyst says gas prices might rise to $3 per gallon by summer 2001 and may even jump to $5 in the next two to three years, the Philadelphia Inquirer reported.The analyst, Philip Verleger, Jr., predicts prices will rise due to outdated U.S. pipelines, which would have difficulty transporting oil from refineries, and international politics such as Iraq cutting exports, the article said.
Many industry experts disagree with Verleger and predict gas prices will fall slightly to $1.40 next summer compared to $1.52 this past summer. Transport Topics
Project Eases U.S.-Canada Border Jams for Truckers
U.S.-Canada border patrols between Port Huron, Mich. and Point Edward, Ontario implemented a new project this week that eases traffic crossing procedures, the Journal of Commerce Online reported.The project aims to curb traffic jams for truckers, although they cannot directly participate in the program, the report said. It would allow certain Canadian and U.S. travelers to speed through customs and immigration services. Travelers must be members of a program called Nexus, which processes travelers through the borders when they show a membership card, photo identification and vehicle registration. Transport Topics
Headlines From Today's A.M. Briefing
- Four U.S. Trucking Subsidiaries File for Voluntary Bankruptcy
- Iraq Stops Exporting Oil; Prices Rise
- Ford Recalls 846,000 Explorer SUVs
- NTSB to Hold Hearing on Emery Plane Crash
- Mexico To Get New President Friday
- Regulators Won't Block Citigroup-Associates Merger
- FedEx Logistics' McCarthy Retiring Next Spring
- Motor Cargo Industries Repurchasing Stock
- Tiny Gain for Intermodal Traffic
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