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REGULATORY REPORT SUPPLIER NEWS
ECONOMIC TRENDS PEOPLE IN THE NEWS
ASSOCIATION NEWS FACTOID
REGULATORY REPORT
Illinois Considers No-Idling Law
The St. Louis Post-Dispatch recently reported that activists have asked the Illinois state legislature in Springfield to rein in truck idling. Bill H.B. 2347, introduced recently in the General Assembly, would make exceptions for certain types of trucks and extreme weather. For the most part, however, truckers would have to shut down once parked.
A synopsis of the bill on the legislature�s Web site reads: �Amends the Illinois Vehicle Code. Provides that a vehicle using diesel fuel with a gross vehicle weight rating of more than 8,000 pounds may not have its engine idling for more than three minutes within any 60-minute period. Creates exemptions. Provides that a violation is a petty offense punishable by a fine of $100 for a first offense and $500 for a second or subsequent offense within any 12-month period. Provides that the provision applies on highways and elsewhere throughout the state.�
The bill has been assigned Environment & Energy Committee, which scheduled a hearing for last week.
Source: Truckinginfo.com, Feb. 25, 2005
SUPPLIER NEWS
Transpro's Sale of Heavy Duty OEM Business to Modine is Finalized
Transpro recently announced it has completed the sale of its heavy duty OEM business to Modine Manufacturing Co. for $17 million in cash. The heavy duty OEM business generated net sales of approximately $50 million in 2004. Transpro said it will use the proceeds from the sale primarily to pay down debt and expects to report a one-time gain of approximately $6 million in the first quarter of 2005, as a result of the transaction.
The sale of Transpro�s heavy duty OEM business was agreed to in connection with the proposed merger of Modine�s aftermarket business, debt free, into Transpro. The two companies intend to close the merger during the second quarter of 2005, subject to customary conditions, including the approval of Transpro�s shareholders.
Source: Aftermarketnews.com, March 2, 2005
Detroit Diesel Corporation, Freightliner LLC Invest $275 Million in Michigan Facility
Detroit Diesel Corporation (DDC) and Freightliner LLC recently announced plans to invest $275 million to upgrade to a manufacturing and office facility in Redford, Mich. Under the companies' plans, the 3.2-million-square-foot Redford facility will become home to a new heavy-duty truck engine line, medium-duty engine assembly and expanded axle assembly. In addition, the Redford campus of buildings will house the new headquarters of Sterling Truck Corp. and Western Star Trucks, two business units of Freightliner LLC. Sterling and Western Star will relocate from Willoughby, Ohio, to Redford in the second quarter of this year.
Over the next two years, the technical capabilities of the facility will be expanded considerably and it will become one of the most advanced truck engine and components manufacturing facilities in North America.
By 2007, the Redford facility will accommodate the manufacturing of an all-new heavy-duty truck engine. Currently in development by Detroit Diesel and parent company DaimlerChrysler � the engine will be launched in 2007 and will incorporate the latest in diesel engine and emissions technology. For an extended transition period, the new engine will be sold in tandem with the popular Detroit Diesel Series 60 engine. In the North American Free Trade Agreement market, the new engine will be installed in heavy-duty vehicles produced by business units of Freightliner LLC.
Construction has already begun to accommodate these new operations.
Source: Aftermarketnews.com, Feb. 24, 2005
International to Build Class 8 Truck Engine
International Truck and Engine Corp. announced last week that it will develop and produce International engines in the 11- to 13-liter range for International Class 8 highway tractors and severe service trucks starting in fall 2007.
According to the announcement, International will continue to offer the current range of Cummins and Caterpillar engines in its heavy vehicles. The International engines will be a product of a previously announced strategic agreement between International and MAN Nutzfahrzeuge to collaborate on design, development, sourcing and manufacturing of components and systems for commercial trucks.
The new International engines will combine world-leading technologies aimed to deliver the features Class 8 customers want, including best-in-class fuel economy, reliability, uptime, long life, robust performance, durability and an exceptional driver experience.
Like the family of International engines, the new engines for Class 8 vehicles will be 2007 Environmental Protection Agency emissions certified and proven with extensive field-testing.
Source: Truckinginfo.com, Feb. 21, 2005
Eaton to Purchase Brazilian Powertrain Manufacturer
Eaton Corp. recently announced plans to purchase Pigozzi S.A. Engrenagens e Transmissoes, an agricultural powertrain business located in Caxias do Sul, Brazil. Pigozzi produces agricultural powertrain products, including transmissions, rotors and other drivetrain components for tractors and harvesters. The business had revenues of about $42 million in 2004. Eaton is buying the business for $30 million, and the transaction is expected to close in early March.
Source: Aftermarketnews.com, Feb. 22, 2005
ECONOMIC TRENDS
Truck Sales Soar 61.9 Percent
U.S. retail sales of Class 8 trucks in January kept up the same blistering pace they set in 2004, setting an apparent all-time record for the month by reaching 18,257 � a 61.9 percent increase over sales in the first month of last year. All major original equipment manufacturers reported at least double-digit percentage increases for the month, ranging from about 30 percent to 120 percent over January 2004, according to data compiled by Ward�s Communications.
Class 8 sales were the highest for any January on record, dating at least back to 1979, said Paul Zajac, Ward�s manager of industry data. The record sales could be the highest ever for January, he said, but Ward�s does not have data for sales prior to the 1970s.
Source: Transport Topics, Feb. 25, 2005
ATA Tonnage Index Reaches Record in January
Overall trucking freight volumes rose 3.4 percent to 116.5 in January, a record high, according to the American Trucking Associations (ATA) index. The gain in ATA�s truck tonnage index was the largest month-to-month gain in several years and was 6.4 percent higher than a year ago.
The rise followed a revised 1 percent decline in December. On a non-seasonally adjusted basis, the tonnage index fell 2.4 percent from December to January. ATA calculates the tonnage index based on surveys from its membership. The index compares activity to a 1993 base year and is derived by sampling companies in all types of freight-hauling operations.
Source: Transport Topics, Feb. 24, 2005
Revised GDP Figure Shows 3.8 Percent Fourth-Quarter Growth
The U.S. economy grew at an annual rate of 3.8 percent in the fourth quarter, up from an earlier 3.1 percent estimate, the Commerce Department said last week.
The revised gross domestic product (GDP) figure was close to the third-quarter 4 percent growth rate and some of the main drivers of the economy included consumer spending, inventory building and business investment. Economists had predicted a 3.7 percent gain, Bloomberg reported.
GDP grew to $11 trillion at an annual rate for the quarter after adjusting for inflation. It was $10.8 trillion of the full year. The revision will be updated again, the Commerce Department said. For all of 2004, the economy grew at a 4.4 percent rate, the strongest since 1999.
The trade deficit, which grew in November, reduced fourth-quarter growth by 1.4 percent vs. 1.7 percent previously reported.
Consumer spending, which accounts for about two-thirds of GDP, grew 4.2 percent, compared with 4.6 percent previously reported. Consumer spending for all of 2004 grew 3.8 percent, the highest since 2000, after rising 3.3 percent in 2003.
The agency that tracks trade with Canada said it had underreported U.S. exports to Canada by about $1.06 billion. The decline in the dollar could boost exports this year because U.S. currency is cheaper in world markets.
Source: Transport Topics, Feb. 25, 2005
NAFTA Trucking Heats Up
The trucking industry hauled $453 billion worth of imports and exports between Canada and Mexico in 2004, according to the Department of Transportation�s (DOT) Bureau of Transportation Statistics. Cross-border shipments via trucking were consistent with overall North American Free Trade Agreement (NAFTA) trade expansion year-over-year, as both increased approximately 12 percent. Railroad trading was slightly higher at just over 13 percent.
And integration also has the potential to keep cross-border tonnage relatively robust, compared with domestic. For example, many global businesses are using a single manufacturing plant in Mexico to supply both the U.S. and Mexico, whereas previously there might have been one plant for each country.
Indeed, trucking remains extremely competitive, accounting for more than 71 percent of the total value of NAFTA trade, with the much of remainder moved by rail (17 percent).
Source: Fleet Owner, March 2, 2005
PEOPLE IN THE NEWS
FleetPride�s Gordon Ulsh Becomes New President and CEO at Exide Technologies
The board of directors of Exide Technologies has appointed Gordon Ulsh as the company's new president and CEO, effective April 2. He succeeds Craig Muhlhauser, who is leaving the company after successfully leading Exide out of Chapter 11 bankruptcy protection.
Ulsh currently is chairman, president and CEO of Texas-based FleetPride Inc. Prior to joining FleetPride in 2001, Ulsh worked with Ripplewood Equity Partners, providing analysis of automotive industry segments for investment opportunities. Earlier, he served as president and COO of Federal-Mogul Corp. in 1999 and as head of its Worldwide Aftermarket Division in 1998. Prior to Federal-Mogul, he held a number of leadership positions with Cooper Industries, including executive vice president of its automotive products segment.
Source: Aftermarketnews.com, March 3, 2005
Delphi's Battenberg Announces Retirement Plans
Delphi chairman and CEO J.T. Battenberg III recently announced his intention to retire later this year. Battenberg will complete a career that spans 44 years and 14 assignments at General Motors and Delphi. He was Delphi's founding chairman, CEO and president, until earlier this year, when Rodney O'Neal was named president and COO. Delphi's board has given its consent to Battenberg's decision, and also announced that it will begin a search for a replacement immediately. The search will include internal candidates as well as candidates from automotive and other industries. The board has asked Battenberg to remain in his current position until the successor is in place.
Source: Aftermarketnews.com, Feb. 23, 2005
Promotions Announced in Penray Sales Effort
The Penray Companies Inc., manufacturers of Penray chemicals, has announced organizational changes in a heavy-duty aftermarket sales expansion.
Howard Laga, previously vice president of power fleet sales has been promoted to vice president of operations where he will manage the entire product supply chain. J. Randall Fowler, previously vice president of marketing, has been promoted to vice president sales, handling automotive, heavy-duty and international sales. Chris McKenzie has been promoted to director of marketing. John Scott is promoted to automotive national sales manager and Tina Pawelczak has been promoted to sales support manager.
Source: Truckinginfo.com, March 3, 2005
ASSOCIATION NEWS
Congressman Barton Predicts Right to Repair Act Passage This Year
Rep. Joe Barton, R-Texas, was strongly optimistic in predicting passage this year of the Motor Vehicle Owners� Right to Repair Act legislation that he will re-introduce to the 109th Congress during remarks to more than 250 attendees at the Aftermarket Legislative Summit this week.
Wearing a �Support the Right to Repair Act� button, Congressman Barton urged summit attendees to follow up on their experience in Washington, D.C. by meeting with their elected officials in their home district, reinforcing the value of grass roots advocacy efforts. Barton�s encouraging remarks preceded 200 appointments with legislators and key staff from 37 states.
�Everyone at the summit was energized by the encouraging words from Rep. Barton, the bill�s sponsor and chairman of the powerful House Energy and Commerce Committee,� said Kathleen Schmatz, president and CEO of the Automotive Aftermarket Industry Association (AAIA). �There is truly a sense that momentum and support for our legislation is growing.�
The legislation achieved a milestone last year with 118 co-sponsors. While 5,400 bills were introduced in Congress last year, only 4 percent were able to collect 100 or more co-sponsors.
Summit attendees also heard from Rep. Joe Knollenberg, R-Mich., sponsor of the Stop Counterfeiting in Manufactured Goods Act of 2005 (H.R. 32). Rep. Knollenberg explained how the legislation would tighten existing criminal sanctions against counterfeiters by mandating the destruction of equipment and materials used for making and packaging counterfeit goods.
More than 300 aftermarket representatives and congressional leaders and staffers attended a special reception at the Rayburn House Office Building on Tuesday evening. Ray Evernham, NASCAR team owner and president and CEO of Evernham Motorsports, was on-hand to talk with guests and take photos.
Other issues addressed at the summit were asbestos litigation reform and association health plans.
To learn how you can send thank-you notes or for other summit follow up information, visit www.aftermarket.org.
Strong Speaker Lineup for First Aftermarket Financial Symposium
Top financial and investment executives from within and outside the industry are slated to address the first-ever Aftermarket Financial Symposium: Leveraging for Growth, Sept. 7-8, 2005 in Chicago, Ill., sponsored by AAIA. A partial list of speakers and their presentations include:
- Perspectives on Key Financial Issues from the Operating Side, Michael Archbold, executive vice president, CFO, AutoZone
- Mergers & Acquisitions, Dan Smith, president, Capstone Financial
- Strategic Planning, Sam B. Rovit, partner, Bain & Company, Inc.
Executives and partners from Lockton Companies, Massachusetts Financial Services and Grant Thornton will make presentations on risk management, perspectives from Wall Street and key financial issues from the accounting profession. Breakout sessions on PARTnerShip Network/Product Information Exchange Standard (PIES)/Catalog Enhanced Standard (ACES) will be hosted by Scott Luckett, AAIA�s vice president, technology standards and solutions.
�Interest has been extremely strong from both the financial community and the aftermarket to the symposium,� said Kathleen Schmatz, AAIA president and CEO. �We urge CFOs, financial service providers, investment analysts, CPA firms and others with interests in improving the bottom line of their business and that of the automotive aftermarket�s to register early.�
The symposium will be held at the Hyatt Regency O�Hare in Chicago on Wednesday, Sept. 7 and Thursday, Sept. 8. For more information, contact Susan Medick at susan.medick@aftermarket.org or Barbara Clark at barbara.clark@aftermarket.org or call 301-654-6664.
Register for both the Aftermarket Financial Symposium: Leveraging for Growth and the Aftermarket eForumTM, July 19-21 in Chicago, Ill., and save $200. To register, visit www.aftermarket.org.
PARTnerShip Network Software Incorporates IPO and PIES
AAIA recently announced the release of PARTnerShip Network version 1.9 software. This new version contains numerous enhancements and two exciting new features: support for Internet Parts Ordering (IPO) and a request for data in the Product Information Exchange Standard (PIES) format.
PARTnerShip Network is an industry-sponsored software solution that addresses the escalating costs of e-commerce communications. The software is an alternative to the Value Added Network (VAN) based communication of EDI and other electronic messages between business partners. PARTnerShip Network delivers critical business documents with the same reliability and security of a VAN at a fraction of the cost because there are no transaction or per-character fees associated with its use.
PARTnerShip Network is the backbone of the aftermarket ecommerce highway allowing purchase order transactions, order acknowledgements and shipment notices to flow seamlessly between distributors and their suppliers. With the addition of IPO support and the Request for PIES, PARTnerShip Network represents an e-commerce platform based entirely on aftermarket industry standards. With these two new features, as well as an enhanced user interface and faster operations, PARTnerShip Network has developed into a robust aftermarket software solution.
�The latest version of PARTnerShip Network is an exceptional value because it includes support for other industry standards, saving precious development time and accelerating adoption,� said Scott Luckett, AAIA�s vice president, technology standards and solutions. �The software operates peer-to-peer, so a manufacturer only installs once to communicate with any trading partners who also have the software installed. The savings grow rapidly as the number of partners increases.�
For more information about PARTnerShip Network software, visit www.epartnet.com.
Aftermarket eForumTM Set for July 19-21
The 2005 Aftermarket eForumTM will be held July 19-21 in Chicago, Ill. The two-and-a-half day event will feature expert presentations and panels, breakout sessions and a vendor show, according to AAIA, which created the e-commerce educational forum in 2000.
Among this year�s top presenters will be John Saia, University of Toyota; Dennis Welvaert, Dayco Products; George Thanasides, G2 Solutions; John Ruck, MTU-Detroit Diesel; Ed Coyle, Department of Defense, Automatic Identification Technology Office; Drew Gude, Microsoft; and Mike Altendorf, Ace Hardware.
Breakout sessions will cover sales force automation, e-business for small- and medium-sized enterprises and Internet Parts Ordering (IPO).
�We expect a sell-out again this year because the Aftermarket eForumTM is the only e-commerce conference dedicated exclusively to automotive aftermarket issues,� said Scott Luckett, AAIA�s vice president, technology standards and solutions. �Now with the active participation of the major aftermarket trade associations in North America, the forum has broadened its accessibility and reinforced its value within all channels or the marketplace.�
For more information about the Aftermarket eForumTM, contact Barbara Clark at 301-654-6664 or barbara.clark@aftermarket.org.
FACTOID
Light sweet crude oil closed at $53.05 on the New York Mercantile Exchange Tuesday, the highest closing price since Oct. 26 when it was near a record, Bloomberg reported. Crude oil set an all-time record Oct. 22 when it closed at $56.17 a barrel.
Source: Transport Topics, March 2, 2005 |