P.M. Executive Briefing - Nov. 2
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ArvinMeritor Fires 240, Cuts 100 Vacancies
ArvinMeritor (ARM), the world's largest maker of heavy-truck axles, said it has laid off 240 workers and wiped out another 100 vacancies, Bloomberg reported, adding that this was an effort to cut costs in the face of still-falling demand in the North American truck market.Bloomberg noted the cuts are less than 1% of ArvinMeritor's workforce of 36,500, but that the company wants to cut costs by 16% in its Commercial Vehicle Systems unit. Transport Topics
Freightliner Recalls 133,000 Trucks
Heavy-truck maker Freightliner is recalling 133,000 vehicles for replacement of a faulty brake pin.
NTBS Chairman Jim Hall said investigators had learned that related incidents have been reported elsewhere, and the potential for the brake pin to fracture exists in other Freightliner trucks. Dan Lang, Transport Topics
Professional Transportation Group Receives Default Notice
Marietta, Ga,-based Professional Transportation Group (TRUC), which provides ground transportation and logistics services for the airfreight and trucking industry, said Thursday it has received written notice from SouthTrust bank that the company has defaulted in paying interest and other amounts on its loan and security agreement.Professional Transportation said the notice demands payment of about $1 million on Thursday. SouthTrust is its principal outside lender.
The company said it was in "active negotiations with SouthTrust and several other lenders in an effort to comply with SouthTrust's demands." It added that there could be "no assurance, however, that the company will be able to comply with SouthTrust's demands or secure other suitable financing."
Professional said it has more than 200 trucks with some of the industry's most current technologies. Transport Topics
Celadon Posts Narrower 1Q Loss
Celadon Group (CLDN) said Thursday that an increase in revenues in its fiscal 2001 first quarter helped to narrow the company's net losses.Indianapolis, Ind.-based Celadon is a truckload and e-commerce company serving the United States, Mexico and Canada.
The company said its consolidated revenue for the three months ended Sept. 30 was $88.4 million, an increase of 7% from the $82.7 million a year ago. Celadon posted a net loss of $470,000 or 6 cents a share for the quarter, compared with a loss of $589,000 or 8 cents in the 1999 period.
Celadon's online marketplace, TruckersB2B, saw revenues increase 350% from the fourth quarter to $900,000. The marketing and administrative costs associated with the new business, however, accounted for Celadon's per-share loss. The company added that it is not seeking to initiate a public offering for TruckersB2B at this time. Transport Topics
Economy Watch: Retailers Sluggish
One day after the manufacturing sector said it contracted during October for the third straight month, major retailers on Thursday reported what the Associated Press called largely lackluster sales for October as widespread markdowns cut into profits.The reports support the argument that the economy is still cooling down and thereby relieving inflationary pressure, and that implies the Federal Reserve will likely refrain from pushing interest rates up again at its Nov. 15 meeting. The central bank has raised rates six times since last summer.
While that is good news for trucking operators who suffered over the past year from higher interest costs, the slowdown in consumer retailing on top of a contraction in manufacturing implies that truck freight shipments will continue to weaken in the near term. Transport Topics
GATX Reorganizes for European Expansion
Chicago-based GATX Corp. (GMT) said Thursday it is creating a new business unit to help the company increase its presence in Europe.GATX is a specialized finance and leasing company that uses asset knowledge, service capabilities, structuring expertise and partnering skills to serve targeted industries including rail, air, technology, telecommunications, and marine.
It is establishing a European-based operation to oversee all company activities in that market. D. Ward Fuller, currently president of GATX Rail, will take the reins as president of the new organization. David Edwards, president of GATX Integrated Solutions, has been named to take Fuller's place as president of GATX Rail.
"The European rail market represents a significant growth opportunity for GATX. ... Our growing position in this market and the opportunities for future growth clearly warrant a greater management presence," said GATX Chairman Ronald Zech. Transport Topics
Container Lessor Cronos Reports $0.07 Per Share in 3Q
Intermodal container lessor Cronos Group (CRNS) reported net income of $636,000, or $0.07 per share for the third quarter, com-pared with income of $1.3 million or $0.07 per share for the same quarter in 1999.Total revenues for the quarter ended Sept. 30 were $36.8 million, compared with $35.5 million for the 1999 quarter. Higher utilization and a larger fleet size were credited. A 4% decline in direct operating expenses was offset by an increase in payments to the company's managed container owners.
The company's board of directors is still considering a sale or merger of the firm, and is also considering management's plan to remain an independent company. In pursuit of sustained profitability, the board is also trying to resolve claims "stemming from the actions of prior management."
Cronos owns and manages a fleet of more than 397,000 twenty-foot equivalent units, and is headquartered in San Francisco. Transport Topics
Headlines From Today's A.M. Briefing
- Vitran Reports 9% Increase in Earnings
- Interpool Posts Higher Revenue Income for 3Q
- Freightliner's October Sales Down 28%
- DaimlerChrysler Plans to Test Fuel Cells in Buses
- Fuel Protest Planned for Nov. 14 in London
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