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Monday, November 11, 2002 |
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| SIGNIFICANT NEWS |
A Compendium of News for Fleet Managers from
November 4 -- 8, 2002 |
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| 1) |
Fed Court Orders DOE To Resolve EPACT Status For Private, Municipal Fleets By End Of Jan |
11) |
Run-Flats Run Risk Of Reducing Safety Buffer During Rear Collisions |
| 2) |
Federal Appeals Court Upholds SCAQMD Fleet Mandate; Future Rules Possible |
12) |
Bankrupt Burlington Execs Under Fire In OOIDA Class Action |
| 3) |
FedEx Truck Bursts Into Fireball, Driver Fatigue May Be Cause |
13) |
US Supreme Court Rules MI Overcharging For Truck Registrations |
| 4) |
NHTSA Publishes List Of Sept 2002 Recalls |
14) |
Port Shutdowns Delay Product, Prompt Stockpiles, Make Some US Manufacturers Happy |
| 5) |
Consumer Reports Gives Sneak Preview Of Annual Auto Study; GM, Hyundai, Volvo Make Gains |
15) |
NJ Bill Seeks To Ban Hand-Held Cell Phones Except In Emergencies |
| 6) |
OSHA Plans 1,300 More Inspections For 2003; Highest Amount In Past 9 Years |
16) |
CarMax Optimistic In Face Of Used-Car Glut, 0% Loans on 2003s |
| 7) |
Will Chrysler Oil/Lube Coupons Drive Owners Back To Dealers? |
17) |
Fed Cuts Rates Half Point To 1.25%, Twice Amount Expected |
| 8) |
NTSB Calls Upon GM And Ford To Test, Improve Safety Of 15-Passenger Vans |
18) |
Automakers Quietly Raise Car Prices To Offset New 0% Wave |
| 9) |
Ford Recalls 2001-2002 Focus - Potential Safety Problems |
19) |
MA Town Shocked Over Mass Roadkill Grave Used By Turnpike Since 1957 |
| 10) |
Glassmakers In Court Over Defamation, Unfair Competition Claims |
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| 1) Fed Court Orders DOE To Resolve EPACT Status For Private, Municipal Fleets By End Of Jan |
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Situation
- Fed court ordered Dept of Energy (DOE) to resolve status of Energy Policy Act (EPACT) mandates for private and municipal fleets
- Court ordered DOE to publish a proposed rule by end of Jan 2003
- Final rule due by end of Nov 2003
- EPACT was signed into law on Oct 24, 1992; is aimed at reducing US dependence on foreign oil
- Original legislation did not impose any statutory mandates on private or municipal fleets
- But allows 2 separate rulemaking procedures to impose purchase mandates if alternative fuel use not expected to meet goals, including 30% usage by 2010
Significant Points
- DOE rulemaking will address 3 issues:
- 1st, whether EPACT goal of reducing petroleum usage by 30% by 2010 is feasible or whether goal should be revised
- 2nd, whether a private/municipal mandate is needed to meet the goal
- 3rd, whether goal will actually be met if the mandate is enforced
Web Source
Sourced from: Automotive Fleet, November 6, 2002
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| 2) Federal Appeals Court Upholds SCAQMD Fleet Mandate; Future Rules Possible |
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Situation
- US Court of Appeals for 9th Circuit upheld fleet mandate rules from So Coast Air Quality Management District (SCAQMD)
- 9th Circuit’s 1-sentence decision says Fed Clean Air Act (CAA) does not preempt local govs from mandating fleet owners and operators to acquire and use AFVs
- NAFA participated in the case as an amicus
- Rules regulate public transit buses, school buses, garbage trucks, street sweepers, shuttle buses and taxis serving airports, and public works trucks
- Rules represent broadest effort to date by a locality to impose fleet acquisition mandates
- SCAQMD has hinted that it remains interested in broadening its rules to cover other fleets
Significant Points
- SCAQMD fleet rules regulate vehicle acquisition activities of certain owners and operators of gov and private fleet vehicles
- Rules mandate that covered fleets only acquire certain approved AFVs, subject to certain exemptions
- Also effectively prohibits covered fleets from acquiring diesel-fueled vehicles
- Possibility remains that more fleets could be covered in the future
- Other US jurisdictions may be tempted to adopt comparable fleet mandates
- Pressure on states to come up w/ additional emission reductions under the new federal ozone standard
Web Source
Sourced from: NAFA Fleet Focus, November 6, 2002
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| 3) FedEx Truck Bursts Into Fireball, Driver Fatigue May Be Cause |
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Situation
- FedEx Ground truck crashed and burst into a giant fireball on I-270 north of St Louis
- Tractor-trailer was nearly obliterated, but truck's driver and passenger or anyone else were not injured
- Accident raised speculation that a bomb packed in cargo may have caused explosion
- However, fire was result of a traffic accident and not terrorism
- Truck was pulling 2 trailers carrying general packages, w/ no hazardous material
Significant Points
- According to KOLR-TV in St Louis, FedEx's truck touched a wall along highway
- Driver allegedly tried to correct the vehicle and pull over to the side, and hit a light pole
- The light pole caused truck's fuel tank to ignite
- Driver told St Louis Post-Dispatch accident was caused when a vehicle cut him off
- According to police, however, driver fatigue was suspected factor
Web Source
Sourced from: Landline Magazine, October 31, 2002
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| 4) NHTSA Publishes List Of Sept 2002 Recalls |
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Situation
- National Highway Traffic Safety Admin (NHTSA) released list of auto safety recalls announced in Sept 2002
- List identifies make and model of vehicle or equipment involved, w/ brief description of safety problem
- Under federal law, safety problems must be remedied w/o cost to consumers
- Manufacturers are required to mail a recall notice to all purchasers, owners and dealers
- More info: Auto Safety Hotline at 1-888-327-4236 or NHTSA Website
Significant Points
- Only 72% of vehicle owners w/ safety problems have recall work performed
- NHTSA urges owners to wait until they receive notification from manufacturer b4 contacting dealers to schedule repair work
- Not all vehicles of a particular make and model may be subject to the recall
Web Source
Sourced from: NHTSA Press Release, October 28, 2002
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| 5) Consumer Reports Gives Sneak Preview Of Annual Auto Study; GM, Hyundai, Volvo Make Gains |
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Situation
- Consumer Reports' latest study includes reliability of 2002 models
- Based on 480K responses from owners of vehicles spanning 8 model years beginning w/ 1995
- GM, Hyundai and Volvo continue to post solid gains in reliability due to new truck/suv/crossover models
Significant Points
- Quality of recently-redesigned 2002 Toyota Camry, Nissan Altima and Subaru Impreza models has fallen
- Chrysler minivans and Jaguar S-type models removed from recommended list because of quality lapses
- For Chrysler, minivan inventor, such a failure could put a damper on sales of its core product
- 13 GM models did well, including Chevrolet Avalanche, GMC Sierra, Pontiac Vibe and Buick LeSabre
- GM's exception was 2002 Chevrolet TrailBlazer, having poor reliability in its 1st year of production
- Hyundai Santa Fe and Sonata mark 1st time a South Korean automaker has placed vehicles on CR's recommended list
Web Source
Sourced from: Detroit News, November 8, 2002
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| 6) OSHA Plans 1,300 More Inspections For 2003; Highest Amount In Past 9 Years |
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Situation
- According to OSHA Chief John Henshaw, OSHA plans to add 1,300 inspections in 2003
- Currently, OSHA is on target to reach its goal of 36,400 inspections for 2002
- Average penalty for serious violations is higher than in past years, over $900 per serious violation
Significant Points
- Would be highest number of inspections in 9 years
- Serious, repeat, or willful violations were found at nearly 75% of workplaces OSHA inspected in 2002
- Same violations have made OSHA’s top 5 list each year:
- (1) Scaffolds (2) Hazard communication (3) Fall protection (4) Respiratory protection (5) Lockout/tagout
Web Source
Sourced from: JJ Keller SafetyClicks, October 2002
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| 7) Will Chrysler Oil/Lube Coupons Drive Owners Back To Dealers? |
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Situation
- Chrysler Group rolls out dealership oil-change coupons
- Annual dealer confab this week in Vegas told of plan
- Get oil change/lube job at dealership for as little as $6 with 7-year/28-change booklet @ $170
- Dealers reimbursed $15 by factory, customer fee covering labor
Significant Points
- Obvious aim to promote other services, such as tire rotations or wiper changes
- Unless dealers invest in separate dedicated oil-change stall and crew purpose may be defeated
- That's attraction of Jiffy Lubes, which also cover all fluids, tire/air checks, etc
- Cheapest oil-change booklet could be more compelling -- $25 for 1-year and 2 changes costing $12.50
- Chrysler thinks it's first with idea, which if true shows they're trying to shore up owner repeat biz
Web Source
Sourced from: Automotive News, November 4, 2002, Page 18
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| 8) NTSB Calls Upon GM And Ford To Test, Improve Safety Of 15-Passenger Vans |
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Situation
- Inclusion of 15-passenger vans in rollover ratings urged by National Transportation Safety Board (NTSB)
- NHTSA chief Dr. Jeffrey Runge urged to cover megavans
- NTSB asks CEOs of GM, Ford to rest electronic anti-roll stabilizer controls for "people movers"
- 500K vans in use in US, 424 persons died since 1990 in large-van tipovers
- NHTSA called Oct 1 for adding "j-turn" and "fishhook" tests for likes of Ford F150 Club Wagon, Chevrolet Express 3500, Dodge Ram Wagon
- 80 damage suits stemming from van rollovers face Ford alone
Significant Points
- Fact that most upenders occur without collisions and involve airport passengers and school kids gives situation top-priority aura
- Technology for stabilizing vehicle on verge of tipping still questioned for effectiveness
- Driver error often chief cause of rollover, not vehicle's "safety profile"
- That's why feds ponder extreme-steering tests, which should be passed as well by megavan drivers
Web Source
Sourced from: Detroit News, November 4, 2002, Page 1A
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| 9) Ford Recalls 2001-2002 Focus - Potential Safety Problems |
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Situation
- Ford recalling 572,795 2000-2001 Focus cars
- Latest in Focus recall barrage, this one has 2 glitches: Front-suspension bolt, battery cable routing
- Bolt could loosen, causing noise or ball joint to separate; cable could overheat, catch fire
- On 2000-2001 Focuses, rear-wheel bearing seal replacement program extended to prevent corrosion
Significant Points
- Benighted Focus still outselling Chevrolet Cavalier (211,126 to 207,388) YTD, but off 10% from 2001
- No one wants 'recall king' crown, but Focus indelibly being hurt despite jazzy styling
- 5-year powertrain warranty only of slight advantage if recalls persist
Web Source
Sourced from: Wall Street Journal, November 5, 2002, Page 7A; Reuters, November 4, 2002
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| 10) Glassmakers In Court Over Defamation, Unfair Competition Claims |
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Situation
- Safelite Glass Corp filed defamation and federal unfair competition countersuit against Diamond Triumph Auto Glass
- Filed in US District Court, Middle District of PA, in Scranton
Significant Points
- Suit over communications distributed by Diamond Triumph Auto Glass to Safelite's clients and auto glass industry
- Safelite characterizes communications as intentionally defamatory
- Countersuit cites specific instances in which Diamond Triumph Auto Glass issued communications that contained defamatory and inflammatory statements
Web Source
Sourced from: CollisionWeek, November 4, 2002
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| 11) Run-Flats Run Risk Of Reducing Safety Buffer During Rear Collisions |
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Situation
- Automakers getting closer to eliminate spare tire, something they've wanted for years
- Increasing reliance on run-flat tires is making spare tires obsolete
- Frees trunk space for more cargo; cuts weight, costs
- Most Lexus SC 430 sports coupe buyers get optional run-flat tires, otherwise trunk is almost useless
- Not yet mainstream run-flats could be on 100K new vehicles in 2003
Significant Points
- But some safety experts say leaving-out spare tire might be unsafe w/ less cushion in rear-end collisions
- Federal rear-crash test gets much tougher in 2003, requiring fuel system to remain leak-free after rear collision at 50 mph, vs 30 mph now
- Test is run w/ spare tire in place; NHTSA, automakers uncertain how vehicles would fare if spares were removed
- Ford investigating whether missing spares contributed to police offers being killed when their Crown Victoria cruisers were hit from behind and burned
- Police often remove spares to reduce weight for better fuel economy and to gain space for more gear
Web Source
Sourced from: USA Today, November 6, 2002
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| 12) Bankrupt Burlington Execs Under Fire In OOIDA Class Action |
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Situation
- Owner-Operator Independent Drivers Assn filed its 1st independent lawsuit against individual officers of bankrupt carrier
- OOIDA suit brought forth in attempt to recover owner-operators' escrow funds
Significant Points
- On Oct 31, OOIDA filed class action in Hamilton Circuit Court (IN) against former Burlington Motor Carrier Inc execs
- Named are Thomas Grojean, Terry Wallace, W Andrew Berry, Jeffery Collier and Brian Gast
- Joining OOIDA in suit are 3 OOIDA owner-operator members, Tom Bays II, Richard Bolduc, Jr and Mark Neff
- Suit filed against officers alleges owner-operators' escrow funds held by Burlington were never returned
- OOIDA already established in courts that such escrow funds are held in trust and, accordingly, are not part of bankruptcy estates of failed carriers
Web Source
Sourced from: Landline Magazine, November 1, 2002
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| 13) US Supreme Court Rules MI Overcharging For Truck Registrations |
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Situation
- Yellow Corp -- and trucking industry -- won Supreme Court battle over fees states may impose
- Court ruled that MI was charging too much for some trucks
- As nation's largest trucking company, Yellow objected to MI rules that would have required $10 yearly payment per truck
- Critics of the policy say if permitted and adopted by other states, it might have meant an extra $150M in annual fees industry wide
Significant Points
- Justices sided unanimously w/ Yellow Freight System w/o dissent
- Yellow contested the $10 required company to pay for registering vehicles that have IL license plates
- MI could have to repay $425K and stop charging fees for IL trucks
- Justice Sandra Day O'Connor said MI fee increase violated 1991 US law revamping federal guidelines for trucking fees
- Had MI won, other states could have raised registration fees for all truckers
- Ruling overturned a Michigan Supreme Court decision
Web Source
Sourced from: TruckingInfo.com, November 11, 2002
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| 14) Port Shutdowns Delay Product, Prompt Stockpiles, Make Some US Manufacturers Happy |
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Situation
- Nationwide survey by logistics specialist BDP International reveals
- US shippers are uncertain over timely settlement of West Coast ports dispute
- Many making contingency plans against additional service disruptions
Significant Points
- Currently favored actions include cargo diversions to East Coast ports, almost 52%
- Other actions: Increases in safety stocks, 34%; Alternate sourcing, 29%; Diversions to Gulf Coast ports, 29%
- Shippers anticipate long-term changes in supply-chain management in preparation for similar future disruptions
Web Source
Sourced from: TruckingInfo.com, November 8, 2002
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| 15) NJ Bill Seeks To Ban Hand-Held Cell Phones Except In Emergencies |
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Situation
- Bill to ban motorists from using hand-held cell phones while driving cleared a NJ Senate committee Oct 17
- Lawmakers introduced bill in attempt to prevent auto accidents
- Proposed ban on hand-held cell phones is similar to law already in effect in NY state
- Supporters say it would save lives by eliminating a distraction that, according to 1 study, is as dangerous as driving drunk
- Senate Law and Public Safety Committee unanimously approved the bill and sent it to full Senate for further consideration
Significant Points
- Bill would make NJ the 2nd state in US to ban motorists from using hand-held cell phones while driving
- 1 significant difference from NY law: NY police can stop and ticket someone they observe talking on hand-held cell phone while driving
- NJ's bill requires police to observe some other violation, like speeding or weaving, b4 they could ticket driver for using hand-held wireless phone
- Under the bill, violations would carry a fine of $100 to $250
- Bill contains an exception allowing motorists to make emergency calls from a hand-held cell phone
Web Source
Sourced from: Automotive Fleet, November 6, 2002
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| 16) CarMax Optimistic In Face Of Used-Car Glut, 0% Loans on 2003s |
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Situation
- CarMax's CEO bullish in new go-it-alone climate
- Slowing growth amid used-vehicle decline fails to disturb W. Austin Ligon, 51
- No longer owned by Circuit City, CarMax still plans to add 6-8 used-car superstores year to present count of 37 stores with 17 new-car franchises
- Finding capital for expansion tests Ligon, but 1st half net earnings of $61M on $2.08B sales shows CarMax formula still effective
Significant Points
- As only used-unit superstore chain, after AutoNation pullout in 1999, CarMax pioneered "certified" pre-owned sales process
- Certified-program explosion by Big-3, Toyota, Honda, BMW and Mercedes becoming CarMax's chief competitor
- CarMax freeze on adding franchises could be lifted to insure chain from accessing auctions of brands it lacks, such as Ford, Cadillac, BMW and Lexus
- To its credit, CarMax made used vehicles worthy of state-of-the-art showrooms in publicly-owned context of "respectability"
Web Source
Sourced from: Automotive News, November 4, 2002, Page 17
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| 17) Fed Cuts Rates Half Point To 1.25%, Twice Amount Expected |
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Situation
- Federal Reserve slashed interest rates by an unexpectedly large half a percentage point
- 1st cut in 11 months indicates Fed hopes to dispel pessimism that threatens economic recovery
- Fed lowered target for so-called 'federal-funds rate' to 1.25% at a policy-making meeting Wed, Nov 6
- Declining payrolls, cutback in factory-worker hours and lower car sales in Oct all suggest growth could fall to 1% or less in 4th Q
- Peugeot sold 500M euros ($500M) of notes due in 2008 Wed, Nov 6 to yield 4.76%
- Ford Motor and General Motors bonds rallied; automakers led gains in corporate bond market
Significant Points
- 1.25% is lowest federal-funds rate in more than a generation
- Half-point cut was twice what investors expected
- Fed also cut its more symbolic discount rate, charged on emergency advances from Fed to commercial banks, to 0.75%, its lowest since 1946
- Lower interest rates heightens optimism the global economy will rebound
- European carmakers may follow Peugeot SA by selling debt
Web Source
Sourced from: The Wall Street Journal; Detroit News, November 7, 2002
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| 18) Automakers Quietly Raise Car Prices To Offset New 0% Wave |
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Situation
- GM, Ford trigger new-unit price hikes to defray cost of new sales incentives
- VW, whose sales tumbled 15% in Oct, joins in w/ "Green Light Lease" offer defraying upfront consumer costs
- GM, which added 90-day payment holiday to extended 0% incentives, boosted 2003 models average of $105 on cars, $137 on trucks
- Ford also plugs in comparable price rise, while offering 0% w/ 90-day pay freeze on leftover 2002s
- Efforts to lure consumers often commit buyers to higher monthly payments based on increased "transaction" prices, as well as payless months
Significant Points
- VW's leap into no-pay incentive club portends similar moves by others whose sales skidded last month
- If Toyota, Nissan and Honda step aboard, Big-3 will face competitive pressure mostly absent during past year since 0% offers took hold
- VW's offer, confined to leasing, also forces competitors to add leasing subventions to their incentive packages
- Reluctantly, from factory view, but w/ consumer approval, "cheap" leases on way back
Web Source
Sourced from: The Wall Street Journal, November 6, 2002, Page D1
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| 19) MA Town Shocked Over Mass Roadkill Grave Used By Turnpike Since 1957 |
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Situation
- Discovery of a mass grave for roadkill in median of the MA Turnpike outraged Stockbridge community officials
- According to Associated Press, town officials said they were unaware that the broad, wooded median held about 4,000 carcasses of animals killed on roadway
- Site apparently been in use since the turnpike opened in 1957
- Town officials say the grave is 300 feet long, 150 feet wide and 45 feet deep
- Since practice ended 2 months ago, carcasses are carted off the road into nearby woods for scavenger animals
- Published reports say incineration is also being considered
Significant Points
- Turnpike Authority allegedly drove dead animals 50-100 miles to dump them in Stockbridge
- Turnpike officials don't believe they've done anything wrong
- Engineers are currently evaluating any damage that might be done to protected wetlands that surround the massive grave
- Stockbridge is best known as the place where singer-songwriter Arlo Guthrie turned his 1965 littering arrest into the anti-war ballad "Alice's Restaurant"
Web Source
Sourced from: Landline Magazine, November 6, 2002
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