P.M. Executive Briefing - Nov. 5
This Afternoon's Headlines:
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Swings and Roundabouts of Demand Leave US Truck Makers in a Spin
A downturn in the North American heavy-duty truck market is expected by Wall Street, but is being met with denials by truck manufacturers. Recently, the build rate has been very high while incoming orders to truck manufacturers have gone down and cancellations have risen, two downward trends further borne out by early data for October.According to Paccar Chairman Mark Pigott, the industry's large backlog of orders will keep the build rate growing through the rest of 1999 and keep the industry going for half a year or more. Stark's Truck & Off-Highway Ledger publisher John Stark said he expects production to remain at the lofty rate, but not grow, starting in November. He recently expected sales to drop over 10% in 2000, and he is now getting the feeling truckmakers expect demand to drop between 15 and 18%.
Historically, a downturn in the medium-duty sector has followed one in the heavy-duty sector by nine months to a year a year. But truck manufacturers have realized that the growth in e-commerce will keep the medium-duty truck industry going, and have responded accordingly. Paccar lately began to build under its Kenworth name trucks designed by Leyland, which Paccar acquired two years ago, and Volvo has also expressed an interest in making more medium-duty trucks. Financial Times (11/05/99) P. 7; Tait, Nikki
State's Roads Aren't the Worst, But They're Close
Pennsylvania has broken its nine-year streak in the yearly Overdrive Magazine poll as the state with the country's worst highways, being voted third worst, after Arkansas and Louisiana, this year.Truckers say the situation in Pennsylvania, where the highways were known for being extremely rough, has improved a great deal. The state has established a limit for roughness that, once passed, requires that the road be resurfaced or rebuilt.
Although I-80 in Pennsylvania is still on the "unspeakably bad" list in Overdrive, a spokesman for the state Transportation Department said the state has "invested over $1 billion in the past 10 or 15 years to make improvements on that road." In 1997, the state passed a gasoline tax that puts money into road repairs.
The poll also found that the Keystone State has the best truck stops in the country. Pittsburgh Post-Gazette Online (11/05/99) ; Silver, Jonathan D.
Push I-PASS to Ease Flow, Tollway Urged
A study commissioned by the Illinois State Toll Highway Authority says the state should encourage motorists' use of I-PASS tolls by lowering the 40 cent toll to 22 cents for I-PASS subscribers and giving the transponders with no deposit. The authority might include this among the possibilities it will present to Gov. George Ryan, who wants better efficiency or no tolls altogether in order to reduce toll-road congestion.Higher I-PASS use would also reduce toll-collector labor costs, although the state will have to install more I-PASS lanes. However, it is not financially feasible to make more I-PASS Express lanes, which enable users to go through without slowing down, the study says.
Arthur Philip, who chairs the toll highway authority, said another possibility would be to hike cash tolls, saying, "People that pay cash would be out-of-state residents, out-of-state trucks." Chicago Tribune (11/05/99) P. 1, Metro Northwest Section; Worthington, Rogers
Charges Sought in Fatal Truck Accident
The California Highway Patrol has asked that trucker Richard Sommerville, 59, of Pedley, Calif., be charged with vehicular manslaughter and DUI regarding an Aug. 2 accident in which three 15,000-pound concrete pipes fell from Sommerville's flatbed truck, causing the deaths of four adults and two children. The chief prosecutor for San Bernardino County will not choose whether to charge Sommerville until he looks over the CHP's report.According to the CHP, the accident happened due to the breakage of a wooden beam, which was low-quality and too small, that was supporting the load. Nylon restraining straps broke after the load moved. Sommerville had a 0.05% blood-alcohol content, above the 0.04% commercial-drivers' limit but below the limit for other drivers. Los Angeles Times (11/05/99) P. 33A; Gorman, Tom
Volvo Seeking to Corner Quarter of China Heavy Goods Vehicle Market
According to China's official Xinhua News Agency, Volvo is partnering with the China National Heavy-Duty Truck Corp. with the intent of debuting a truck plant in Jinan, China, in early 2000, and a goal of taking a quarter of the country's market for heavy goods vehicles. Volvo officials said the company is looking for an annual output of 10,000 vehicles following the initial five years of production, Xinhua reported. Agence France Presse (11/05/99)Canam Boosts Capacity
Canam Manac Group announced a roughly C$15 million investment to raise capacity at its Quebec and Ontario Manac trailer plants. Over 100 jobs will be added, and annual capacity will be raised to approximately 11,500 units. Montreal Gazette (11/05/99) P. C12Ryan Pal Says He Took Money for Safety
Dean Bauer, who was Illinois secretary of state inspector general when Gov. George Ryan was secretary of state, said he did take a briefcase containing cash and fundraising tickets while the drivers' licensing site in Libertyville was being raided in 1993.He said he took the briefcase to keep it safe because of the amount of cash inside, keeping it in a Joliet secretary of state inspector general's office for a few years before giving it to the general fund. He was not trying to cover up possible evidence, he said.
A spokesman for a federal prosecutor looking into the Operation Safe Road investigation, which regards alleged bribery in exchange for drivers' licenses, would not say if Bauer is a probe target, and Bauer would not comment on whether he testified to the Operation Safe Road grand jury or if authorities have interrogated him.
The 1993 raid occurred due to an earlier probe into alleged campaign donations given for licenses at Libertyville and possibly other sites, a probe which led to seven convictions. Bauer denied an allegation in a 1998 affidavit from Russell Sonneveld, a onetime secretary of state investigator, that Bauer had stopped him from investigating whether a trucker had been licensed unlawfully at the McCook site. That trucker was involved in a deadly Wisconsin accident. Chicago Tribune Online (11/05/99); Marx, Gary; Cohen, Laurie
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