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YRC Wins Debt Exchange
Trucker hails „major turning point‟ in repairing its troubled
The agreement, which came after five extensions of the
exchange offer deadline, from holders of bonds from the
company‟s purchase of USF several years ago clears away
hundreds of millions of dollars in debt and gives YRC the
ability to make a payment to lenders due by 11:59 p.m. EST,
YRC now moves into 2010 with much of the huge debt that
burdened the company removed. "The success of this note
exchange marks a major turning point for YRC Worldwide --
with our significantly restructured balance sheet and
enhanced liquidity, we will move forward from a more solid
financial foundation," Bill Zollars, chairman and CEO, said in
The company now will try to win back shippers that industry
observers say have shifted away from YRC because of fears
of a potential bankruptcy filing or shutdown.
Recession, White House
Made for Year of Challenges
Trucking fleets focused on survival in 2009 as freight
haulers battled a widespread economic downturn and
confronted the prospect of significant new safety and
environmental regulations from the Obama
A continuing decline in truck tonnage forced many
carriers to slash rates and shrink the size of their
fleets, depressing profits and curbing demand for new
and used tractors and trailers.
Department of Transportation, Secretary Ray LaHood
announced a plan to re-examine driver hours-of-
service rules in effect since 2004 and sparred with
congressional leaders over upcoming highway funding
legislation, while The Environmental Protection
Agency took the first steps toward regulating carbon
Expected Crackdown on
Some of the year‟s most significant information
technology developments came from Washington,
D.C., where federal regulators planted the seeds for
tighter industry oversight for years to come.
Both the Department of Transportation and members
of Congress came out against distracted driving,
though no legislation appeared imminent at the end of
DOT, however, has promised a rulemaking that will
address driver distraction, and legislators introduced
bills that would, among other things, likely ban text
messaging from commercial trucks.
Sen. Jay Rockefeller (D-W.Va.) and Sen. Charles
Schumer (D-N.Y.) introduced separate texting bans in
the Senate, and American Trucking Associations threw
its support behind Schumer‟s bill in October.
Workers Continue To Clear
I-40 Rock Slide
Work crews struggling around the clock to clear a
rockslide on Interstate 40 in western North
Carolina to speed the clearance of boulders from
the road, the Associated Press reported.
The rockslide closed down a section of I-40 near
the Tennessee line in late October and it has
been closed since.
Officials originally estimated the highway would
reopen in January. They now say it could reopen
in March but say snow and ice could slow
workers down, making conditions hazardous on
steep and rocky terrain.
Congress adds $40 Billion in
In a flurry of activity before its holiday recess,
Congress approved more than $40 billion in new
highway spending for 2010, moved toward
adding another $27 billion, approved a truck-
weight exemption and quietly dropped a
prohibition on a federal pilot program allowing
trucking across the U.S.-Mexico border.
The spending bill allows Maine and Vermont to
conduct one-year pilot programs to test increased
truck weights, and it omits a provision preventing
DOT from spending money on a Mexican
trucking pilot program that was in the previous
Arrow Trucking Closes
Flatbed and heavy specialized carrier Arrow Trucking
has closed down, the Associated Press reported.
The Tulsa, Okla.-based carrier suspended its
operations and laid off all of its workers.
In a brief statement Chief Executive Officer Doug
Pielsticker said that it is negotiating with its principal
lender, and that the lender wants to secure its
Arrow‟s telephone lines have a recorded message
telling drivers to take their trucks to the nearest
Freightliner dealership and that Arrow would give
drivers a bus ticket home.
Arrow has 1,600 employees, 1,320 trucks and 2,400
trailers, the company told TT earlier this year. In
addition to truckload and less-than-truckload services,
it also runs logistics operations.
Ocean Container Carrier
Losses Reach $11 Billion
The world‟s top 22 ocean container carriers lost some
$11 billion in the first nine months of the year and face
further losses in 2010 as the industry digs out from the
worst downturn in its 50-plus history.
Sixteen of the carriers that have published third-
quarter results reported cumulative operating losses of
$9 billion in the first nine months of 2009, according to
a survey by AXS-Alphaliner, the Paris-based shipping
analyst and consultant. This compares with a
combined operating profit of $5.3 billion in the
corresponding period of 2008.
The total shipping revenue of the 16 carriers publishing
results — including Maersk Line, Hapag-Lloyd, China
Shipping, “K” Line and NYK Line — plunged 40
percent in the first nine months, to $56 billion from $94
million a year earlier.
Ocean Container Carrier
Losses Reach $11 Billion
The Transpacific Stabilization Agreement, a
discussion agreement of carriers that control 90
percent of U.S. containerized imports from Asia,
last week predicted losses in that trade would hit
$20 billion this year, and recommended an
“emergency revenue program” involving a rate
hike of $400 per 40-foot container on Jan. 15.
The Westbound Transpacific Stabilization
Agreement, representing carriers in the U.S.-to-
Asia trade, on Monday followed with its own
recommendation for similar hikes.
Most ocean carriers surveyed by Alphaliner
expect cargo volume and rates to recover in
2010, but most also expect to lose money next
Retailers Forecast Strong
Containerized imports at 10 major U.S. ports are expected to
rise in three consecutive months starting in February,
breaking a 31-month streak of year-to-year declines, the
National Retail Federation and IHS Global Insight said in their
monthly Port Tracker report.
“We‟ve been seeing hints of a turnaround in our past few
reports but this is starting to look like a clear trend,” said
Jonathan Gold, the NRF‟s vice president for supply chain and
customs policy. “If retailers are starting to import more
merchandise, it‟s because they expect to be able to sell more,
and that‟s a good sign for our industry and the overall
Ports surveyed handled 1.18 million TEUs in October, the
most recent month for which actual numbers are available.
That was up 4 percent from September but was down 14
percent from October 2008. November was estimated at 1.09
million TEUs, down 12 percent from last year, and December
is forecast at 1.05 million TEUs, down 1 percent.
Saia Selling Stock to Pay Debt
Regional trucker Saia, seeking to restructure
debt obligations amid falling demand and high
costs, said Tuesday it will sell 2.3 million shares
to institutional investors as part of a plan to make
Saia said it expects to raise $25.1 million in the
offering, which is expected to close Dec. 29, and
that it will use the money to pay off some debt.
Lenders in the agreement would ease some
terms of covenants through the first quarter of
The Georgia-based less-than-truckload carrier
also will reduce its borrowing capability under a
revolving credit line from $160 million to $120
FedEx’s Quarterly Profits
Net income and revenue declined at FedEx Corp. for its fiscal
second quarter ended Nov. 30, but executives said
improvements in recent volume trends and the global
economy are reasons for optimism.
The second-largest corporation in North American freight
transportation earned $345 million, or $1.10 a share, on
revenue of $8.6 billion. In the same quarter last year, it had
net income of $493 million, or $1.58 a share, on revenue of
We believe the U.S. economy reached a turning point year-
over-year during our second fiscal quarter, with the one-year
anniversary of the financial collapse. Several economic
indicators related to industrial demand turned positive,
compared to the same time last year,” Chairman and CEO
Frederick Smith said during the call.
Smith said FedEx has now weathered “the worst economic
downturn in its history.”
MOL to Raise Asia-U.S. Rates
MOL said Thursday it will increase ocean freight rates
for all cargo originating in Asia and imported into the
United States, effective Jan. 15.
The move by the Japanese liner follows an
announcement Dec. 16 by other major ocean carriers
that they will seek compensation for rising operating
costs as the container transport industry begins a
The general rate increase for MOL will be $320 per 20-
foot equivalent unit, $400 per 40-foot equivalent unit,
$450 per 40-foot high cube container, and $505 per
45-foot standard containers from Asia, the Middle
East, Australia and New Zealand to all destinations in
the United States and Mexico (excluding Puerto Rico
and Virgin Islands).
Pricing Edge Up
Trucking bankruptcies are beginning to climb again,
putting upward pressure on rates just as shippers
prepare contracts for bidding in the first quarter of
The number of motor carrier bankruptcies rose 8.6
percent from the second quarter to the third as 405
companies shut down, said investment banking firm
The number of trucks pulled out of service more than
doubled from quarter to quarter, rising from 6,725 to
14,135, Avondale said. The average fleet size of the
carriers that closed rose from 18 to 35 trucks.
That hardly put a dent in the glut of excess capacity,
however, taking only 0.7 percent of the nation‟s heavy
truck capacity off the highways, the firm said.
FedEx rate increase for 2010
FedEx said late Thursday it will raise its standard
list rates for its FedEx Ground and FedEx Home
Delivery units by an average of 4.9%, effective
FedEx Corp. previously announced that it would
increase shipping rates for FedEx Express by an
average of 5.9% for U.S. domestic and U.S.
export services, also effective Jan. 4.
The FedEx Express rate increase will be partially
offset by adjusting the fuel price at which the fuel
surcharge begins, reducing the fuel surcharge by
Competitor UPS Inc. said last month it would also
raise its 2010 rates by an average 4.9%
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