short takes
Penske Truck Leasing
Co. has entered into
an agreement to
acquire Bright Truck
Leasing & Bright Distribution, a provider of
full-service truck leasing, truck rental, maintenance, and logistics services.
Headquartered near Dallas, Bright Truck
Leasing & Bright Distribution serves
approximately 2,400 customers at 19 locations throughout Texas. … Accellos, a
developer of supply chain software solutions, has acquired vSync Inc., based in
Columbus, Ohio. vSync is a provider of EDI
and shipping compliance solutions.
Accellos will continue to market and support the vSync product line, which will
become a key component of Accellos One.
… Höegh Autoliners, an ocean carrier that
specializes in the transportation of vehicles
and rolling stock, has added the Port of
Charleston to its Middle East service,
scheduling two ship calls a month. … UPS
plans to significantly increase its global
service parts logistics network by establishing 101 new field stocking locations in
China. Designed to support its customers’
aftermarket needs in Asia, the expansion
now provides UPS with coverage in 89 key
cities across China. ... DHL has launched
new direct less-than-containerload services from Shanghai, China, to Buenos Aires,
Argentina, and Valparaiso, Chile. …
Romark Logistics of PA will receive a $2.1
million solar energy grant from the
Commonwealth of Pennsylvania to build a
2-megawatt rooftop solar array at its
525,000-square-foot distribution facility in
Hazle Township, Pa. The system will produce approximately 10 percent of the facility’s annual energy needs. ... Damco, the
newly combined brand for the A.P. Moller-Maersk Group’s logistics divisions, has
launched an Americas Bridge service to 33
key Latin American destinations. The new
service uses Miami as a hub to consolidate
less-than-containerload freight from various U.S. originating points destined for the
Latin American markets.
UPS to revamp U.S. small-package
business, lay off 1,800
UPS Inc. will restructure its U.S. small-package operations, reducing
the number of regions to three from five and eliminating 1,800 management and administrative positions.
The restructuring, which takes effect in April, will also reduce the
number of districts UPS serves to 20 from 46. UPS said it has no plans
to close any U.S. operating facilities. The restructuring will not affect
the company’s international operations or other parts of its domestic
business. UPS, the nation’s largest transportation company, has 63,000
U.S.-based managers out of a U.S. workforce of about 340,000.
UPS spokesman Norman Black said improvements in technology
and processes enable the company to streamline its U.S. infrastructure
without any impact on delivery operations.
The move comes as UPS raised its initial earnings estimates for the
fourth quarter of 2009, citing “better-than-expected results” from its
domestic and international services, as well as increased cost savings.
UPS said it expects fourth-quarter earnings to come in between 73
cents and 75 cents a share. UPS previously forecast earnings of between
58 cents and 65 cents a share. The nation’s largest transportation company planned to release its fourth-quarter results on Feb. 2.
Jon A. Langenfeld, analyst at Milwaukee-based investment firm
Robert W. Baird & Co., said the stronger-than-expected fourth-quarter
earnings reflect an improving economy and growing demand for shipping services, as well as UPS’s powerful competitive position. Of the
four major global parcel companies—UPS, FedEx Corp., DHL Express,
and TNT—only UPS has “credible scale” in the three major geogra-phies of North America, Europe, and Asia, Langenfeld said.
Langenfeld, who forecast the U.S. small-parcel market to grow faster
in 2010 than the gross domestic product (GDP), believes UPS will benefit from the absence of DHL, whose exit from U.S. domestic service
will now be fully felt as the economy enters a cyclical upturn.
Langenfeld sees even more upside for the international parcel market
in general, with growth doubling that of GDP.
UPS will benefit from an upturn in industrial activity. The Institute for
Supply Management (ISM) said U.S. manufacturing expanded in
December at the fastest pace in close to four years. The ISM factory index
rose to 55. 9, the highest level since April 2006, according to the Tempe,
Ariz.-based group. A reading greater than “ 50” signals expansion.
The domestic package business, which includes parcels shipped by
air and ground, represents about 60 percent of UPS’s total revenue and
operating income. Since the late 1990s, however, UPS’s dominance of
the U.S. parcel market—especially the ground parcel category, where it
once controlled more than 90 percent of the business—has been eroded by FedEx’s FedEx Ground unit. FedEx in 1997 acquired Caliber
System Inc., the parent of UPS rival Roadway Package System Inc., and
over the years has made significant inroads in UPS’s once-impregnable
market share position.
In its third quarter, UPS’s U.S. small-package revenue was $6.87 billion, down from $7.84 billion in the same period in 2008. Total volumes fell 3. 6 percent to 799 million pieces, UPS said. The company
attributed the results to weakness in the U.S. economy. ;
