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STB ISSUES NEW MERGER RULES

BUSH NOMINATES HENSHAW AS OSHA CHIEF

ORDERS FOR DURABLE GOODS RISE

SAFETY FIGURES IMPROVED FOR ROADCHECK 2001

APPEALS COURT SUPPORTS UPS, REVERSES U.S. TAX COURT

FEDEX BEGINS PLACEMENT OF DROP-BOXES

BAX GLOBAL EXTENDS SERVICE BETWEEN CANADA AND US

FMCSA FINES NEW YORK CARRIER FOR VIOLATIONS

INTERWORLD INTRODUCES ENTERPRISE COMMERCE ROI ESTIMATOR

TECHNOLOGY CONTINUES TO DRIVE ECONOMY

CALIFORNIA CONSIDERING TRUCK-ONLY LANES

SUPPLYLINKS FOLDS

FMC CRITICIZES GRAIN SHIPPERS

BRICK-AND-CLICKS THRIVE ONLINE

SUPPLY-CHAIN SERVICE REVENUES $83BIL BY '05

BNSF TEAMS WITH CSX INTERMODAL TO PROVIDE "ICE COLD" SERVICE

TRUCKER RECOGNIZED FOR RESCUING HIGHWAY WORKER






























































STB ISSUES NEW MERGER RULES

Surface Transportation Board has issued revised rules for major railroad mergers. Major rail mergers are those involving at least two so-called class 1 railroads operating in the United States, which include Burlington Northern Santa Fe, Canadian National, Canadian Pacific, CSX, Kansas City Southern, Norfolk Southern and Union Pacific.

Although the new rail-merger rules were 15 months in the making, they do not appear to differ appreciably from the rules they replace. In fact, they read more as a policy statement than new rules. Specific new standards were not imposed, the time period for regulatory approval was not shortened and one major railroad was exempted from the new rules.

Although the STB said the new rules "substantially increase the burden on rail merger" applicants, the STB also said, "We cannot say in advance of a particular proposal exactly what type and what quantity of competitive enhancements would be appropriate. We believe that offering some new or enhanced rail-to-rail competition or other competitive benefits is likely to be necessary to resolve substantial difficulties so as to tip the balance in favor of the public interest."

Competitive enhancements could include reciprocal switching, trackage rights and so-called paper barriers prohibiting shortline railroads from interchanging traffic with more than one class 1 railroad. The STB declined to adopt a "bill of rights" recommended by the American Short Line and Regional Railroad Association.

The STB specifically exempted Kansas City Southern Railway from the new rules, saying a merger application involving the KCS and another major railroad would be considered under the previous rules. This also means that a KCS merger would escape a more labor-friendly employee protective arrangement provided in the new rules. STB Chairman Linda Morgan dissented from the decision with regard to the KCS exemption, which was proposed by Commissioner Wayne Burkes and supported by Vice Chairman William Clyburn.

Where the STB said last October it would impose more detailed filing requirements on transnational mergers, the STB scrapped that requirement in its final rule out of concern that the requirement would conflict with provisions of the North American Free Trade Agreement. Transnational merger applicants must, however, "discuss and assess the national defense ramifications" of the proposed transaction, said the STB. Also, the STB said that in reviewing a merger application, it would consider such a transaction's likelihood to spark additional rail mergers and the competitive effects of such additional combinations.

The STB said it would "consider whether the benefits claimed by applicants could be realized by means other than the proposed consolidation," such as through joint marketing arrangements and interline partnerships. The STB did say it would "require applicants to present an effective plan to keep open major existing gateways and will impose conditions on any transaction that we approve to ensure that result." At the same time, the board said, "We cannot overrule our bottleneck decision so as to permit separate rate challenges to all segments of through or joint rates … It is now well settled that, absent a transportation contract to a junction, our statutory scheme does not per it shippers to challenge segments of joint or through rates."

Applicants would be required to submit a service assurance plan indicating how shippers might gain relief should the merged railroads deliver "less-than-optimum operations" following the merger. The STB said it would "codify" its relatively recent practice of subjecting approved rail mergers to at least five years' oversight.
































































BUSH NOMINATES HENSHAW AS OSHA CHIEF

President Bush is nominating John Henshaw, health and safety director for a St. Louis chemical company, to run the agency that sets and enforces workplace safety and health standards.

The White House announced Henshaw's nomination as assistant labor secretary for the Occupational Safety and Health Administration on Wednesday. The nomination is subject to Senate confirmation.
Organized labor supported Henshaw's nomination.

"It's refreshing that they've actually picked someone with a background in the field and some stature,'' said Bill Borwegan, occupational health and safety director for the Service Employees International Union.

The White House said Henshaw is director of environment, safety and health for Astaris LLC of St. Louis, which makes phosphorus chemicals, phosphoric acid and phosphate salt and is a joint venture of FMC and Solutia Inc. An Astaris receptionist said Tuesday that Henshaw was no longer with the company.

Unions and business groups have a particular interest in who leads OSHA because it will have oversight for new policies the Bush administration pursues to reduce work-related injuries. Clinton-era regulations on ergonomics _ adapting working conditions to suit individual employees _ were repealed by Congress in March after a big legislative battle.

Union officials praised Henshaw's health and safety experience but questioned how much authority he will have.

"John is a competent and widely respected safety and health professional who's got a lot of experience in the field,'' said Peg Seminario, AFL-CIO health and safety director. "The question we have, however, is what he actually will be allowed to do to protect worker safety and health given the Bush administration's track record on these issues to date.''

Henshaw will be leading OSHA in a new direction outlined by Labor Secretary Elaine Chao, who has said the agency's approach will be "based on cooperation and prevention rather than the antiquated adversarial approach of years past.''

The American Industrial Hygiene Association, in a letter supporting Henshaw's nomination, said he has "the vision and ability to build coalitions and consensus among diverse groups to effectively promote a health and safety agenda accepted by all.''

But another Labor Department nominee awaiting confirmation could hit a snag now that Democrats control the Senate.

Democrats and organized labor are undecided whether to fight the nomination of Eugene Scalia, son of Supreme Court Justice Antonin Scalia and a Washington labor lawyer, as solicitor.

Outspoken and ideologically conservative, Scalia would be the agency's top lawyer. A confirmation hearing has not been scheduled.

"We're deeply concerned about his nomination and his record,'' Seminario said. "We're still evaluating and have not come to a final decision.''

Scalia wrote in a 1999 Wall Street Journal column that the then-proposed OSHA ergonomics rule "relies on doubtful evidence that repeatedly has flunked the courts' `junk science' test.'' As a lawyer, he has represented stalwart opponents of federal ergonomics regulations and has fought efforts at the state level, including California.

Scalia as labor solicitor is "a pretty scary prospect,'' SEIU's Borwegan said.

































































ORDERS FOR DURABLE GOODS RISE

A new report from the Commerce Department Tuesday showed that orders for big ticket items rose 2.9 percent in May.

Most economists on Wall Street were expecting orders for durable goods, or items meant to last three years or longer, to decline by 0.3 percent after falling 5.5 percent in April and rising 2.2 percent in March. The April decline was the first decline since a 10.7 percent plunge back in January.

Excluding transportation equipment, orders increased 2.7 percent in May after falling 3.9 percent during April.

The report is based on the North American Industry Classification System, or NAICS, which has replaced the Standard Industrial Classification system. Both systems track certain types of businesses. NAICS includes is broader and includes more companies in the high-tech and service industries.

The report includes categories on computers, semiconductors and communications equipment. Previously those categories were lumped together.

The latest report from the Commerce Department showed inventories of durable goods fell 0.5 percent in May, shipments increased 3.1 percent and unfilled orders declined 0.7 percent.

Orders for transportation equipment rose 3.4 percent during the month as demand increased for aircraft and autos. In April, orders for transportation equipment fell 9.4 percent.

Orders for commercial aircraft rose 2.9 percent after falling 13.8 percent a month earlier.
The Commerce Department said orders for motor vehicles and parts rose 2.9 percent during the month after sinking 13.8 percent in April.

The report also showed orders for semiconductors jumped 35.3 percent after falling 40 percent a month earlier.

Orders for defense capital goods improved 0.1 percent after falling 23.9 percent a month earlier.

The Commerce Department said orders for primary metals increased 5.9 percent and orders for machinery rose 2.6 percent in May.
































































SAFETY FIGURES IMPROVED FOR ROADCHECK 2001

The Commercial Vehicle Safety Alliance says results of Roadcheck 2001 show that truckers and fleets are improving their compliance with federal and state safety laws.

With 92 percent of jurisdictions reporting, the CVSA says a total of 42,795 trucks were inspected June 5-7, surpassing 2000 levels. Of those, 35,486 were CVSA North American Standard Level I inspections, a 37-step procedure that inspects not only the truck but also the driver’s fitness for duty.

Seventy-six percent of the vehicles passed inspection and 24 percent placed out of service. Brake problems were the most frequent out-of-service violation, comprising nearly half the total of critical violations. Problems with lights, tires and wheels, suspensions and load securement were also common.

"The primary objective of the annual Roadchecks is to remove unsafe commercial vehicles and drivers from the road," said Stephen Campbell, CVSA executive director. "Every day there are CVSA-trained and certified inspectors out there doing a great job of making sure commercial vehicles and their drivers meet safety standards."

At a weigh station along Interstate 20 near Anniston, Ala., for example, the first truck placed out of service June 5 failed the brake inspection. The trailer also was placed out of service because of load securement issues.

The truck’s load -- a concrete bridge support that was oversize, over-length and overweight -- was secured with only two chains the size of a child’s forearm. The driver also had failed to properly mark the truck and trailer as oversize.

The CVSA said out-of-service rates for drivers fell only slightly, from 6.4 percent in 2000 to 6.3 percent in 2001. But when the inspection focused solely on the driver, the out-of-service rate was 12.9 percent.

Inspectors checked 501 motor coaches, placing 9 percent of them out of service. Nine percent of motor coach drivers also were placed out of service.

More than 80 percent of the 3,677 hazardous materials vehicles inspected were found to be mechanically fit, while 17 percent of those vehicles and 2.1 percent of their drivers were placed out of service. The CVSA said those figures show a massive reduction in out-of-service rates compared to the previous year.

A total of 22,712 vehicles were found completely clear of critical safety defects. Inspectors placed a CVSA safety decal on each of those vehicles.

The Federal Motor Carrier Safety Administration, the Canadian Council of Motor Transport Administrators, the National Highway Traffic Safety Administration, the Tire Retread Information Bureau and the Research and Special Programs Administration sponsored Roadcheck 2001 along with the CVSA. The inspections took place at 998 locations throughout the United States, Mexico and Canada and used 10,610 inspectors.































































APPEALS COURT SUPPORTS UPS, REVERSES U.S. TAX COURT

The 11th U.S. Circuit Court of Appeals, in an important ruling, today overturned a 1999 decision that UPS had improperly tried to avoid federal income taxes when it restructured its program for providing extra package insurance to its customers.

The appeals court said the IRS and Tax Court were wrong to brand UPS as attempting a "sham transaction" to avoid its tax obligations. After reversing the 1999 decision, the appellate court then remanded the case back to the U.S. Tax Court, saying any claims by the IRS should be analyzed under provisions of the Tax Code cited by UPS.

"The sophistication (of the insurance revisions) does not change the fact that there was a real business that served the genuine need for customers to enjoy loss coverage and for UPS to lower its liability exposure," the court majority wrote in a 16-page opinion. "We therefore conclude that UPS's restructuring of its excess-value business had both real economic effects and a business purpose, and it therefore under our precedent had sufficient economic substance to merit respect in taxation.
"For the foregoing reasons, we reverse the judgment against UPS and remand the action to the Tax Court . . . "

Based on the original Aug. 9, 1999, decision of a Tax Court judge that applied to the 1984 tax year, UPS estimated its potential liability at $1.8 billion for all subsequent years if his ruling were allowed to stand. The company then recorded a special tax assessment on its books of $1.786 billion, reducing its income for the second quarter of 1999 by a net $1.442 billion. Without conceding liability, UPS then paid $1.8 billion into a special account with the IRS, pending a decision by the 11th Circuit Court of Appeals. The balance will remain in place pending further proceedings on remand.

"This case was much more to us than a dispute over tax regulations and Tax Code interpretations, because we hold nothing more sacred than our reputation," said UPS Chairman and CEO Jim Kelly. "So we are extremely pleased the original opinion has been reversed."

The case, known as UPS vs. Commissioner of Internal Revenue, was argued before the 11th Circuit on March 7. The case focused on the manner in which UPS decided to exit the excess value coverage business in 1984, creating a new, independent company known as Overseas Partners Ltd., or OPL. OPL subsequently based itself in Bermuda and over the years, grew into one of the largest re-insurance companies in the world.

Prior to 1984, UPS provided excess value coverage itself. After creating and spinning off OPL, UPS engaged another U.S. company, National Union Fire Insurance Co., to provide the insurance purchased by UPS shippers.
The IRS argued in 1997 that UPS had created OPL solely to avoid federal taxes and that UPS must pay federal taxes on OPL's income. UPS, for its part, adamantly and consistently disputed the IRS' position, saying it had followed all applicable laws and tax regulations in establishing OPL. The appeals court ruled today "that OPL is an independently taxable entity that is not under UPS's control."

Before and after the changes, UPS offered the lowest rates in the industry for excess value coverage. To this day, for example, a package with a value of $300 can be insured at UPS for 70-cents, compared to $4 for the U.S. Postal Service, $2.50 for FedEx and $2.10 for DHL.
































































FEDEX BEGINS PLACEMENT OF DROP-BOXES

FedEx Express has announced that 700 self-service drop boxes will be installed beginning this week in metropolitan areas of Washington D.C., Chicago, Philadelphia, and Trenton, N.J., with an additional 32 markets to be served by the end of July.

The national rollout follows a successful test that began in Charlotte, N.C., on March 5 with the installation of 82 drop boxes, followed by the Fort Lauderdale installation of 31 drop boxes in early April. Operations ran smoothly in both locations.

"Customers in our test markets have responded enthusiastically to the new FedEx Drop Box options in their neighborhoods," says David J. Bronczek, president and CEO of FedEx Express.

By the end of July, an estimated 3,000 FedEx Drop Boxes will be installed outside post offices in 38 leading metropolitan areas. During August and September, at least 70 additional markets from New York to Honolulu will receive FedEx Drop Boxes at local post offices. FedEx expects to place thousands of drop boxes at post offices nationwide.

FedEx will pay the United States Postal Service between $126 and $232 million in new revenue, depending on the number of self-service drop boxes that are placed outside post offices over the seven-year contract period.

Under the terms of the agreement, Postal Service retail associates will not handle or accept FedEx products. FedEx employees provide both the service and maintenance of the drop boxes.

"These agreements focus on our core business–-universal access to mail services, at the best value possible for the American people. Ultimately this business alliance will strengthen the Postal Service, help it manage its costs, grow revenue and improve services," said Patricia M. Gibert, Postal Service Vice President of Retail, Consumers and Small Business.

The Postal Service and FedEx will begin operational testing of the shared air transportation network in several cities next week. National implementation will begin late August.































































BAX GLOBAL EXTENDS SERVICE BETWEEN CANADA AND US

BAX Global Inc. has expanded its new BAXSaver transportation service to include delivery between Canada and US. BAXSaver is part of the company's recently announced BAXSuite North American Transportation Solutions, made custom for industrial shippers of heavier freight.

Available between the U.S. and Canada, the new service is offering door-to-door delivery throughout the U.S and between the U.S. and Canada.

"The immediate success of BAXSaver in the U.S. market prompted us to move it quickly north," said Joseph L. Carnes, president, BAX Global. "Even with normal customs and documentation requirements, this service provides our customers with another opportunity to competitively sell their products over the Canada-U.S. trans-border market."

BAXSaver is a distance-based, zone-priced transportation service with no size or weight restrictions. BAXSaver's Canada service is available between the US and the major Canadian cities of Calgary, Edmonton, Halifax, Montreal, Ottawa, Quebec City, Toronto, Vancouver and Winnipeg.































































FMCSA FINES NEW YORK CARRIER FOR VIOLATIONS

The Federal Motor Carrier Safety Administration announced June 13 that it fined Starving Students Moving Systems Inc. of Brooklyn, N.Y., $45,000 for policy violations that were related to moving services.

The FMCSA investigated the company after it received many customer complaints. The FMCSA cited Starving Students, which also conducts business under the name Official Moving Systems, for failing to charge applicable tariff rates, failing to provide required information to its customers about rights and responsibilities during a move, and failing to release shipments moved under a non-binding estimate after the carrier demanded 110 percent of the estimate.

Official Moving also was charged with failing to weigh interstate household goods shipments in the required manner, failing to reweigh household goods shipments upon the request of the shipper and for requiring shippers to sign documents that released the carrier from its liability.

Official Moving will be able to contest the alleged violations and the fine amount in an agency proceeding.

Congress is pressuring the FMCSA to improve its policing of the moving industry. A recent General Accounting Office report criticized the agency for not providing enough oversight for the industry and for not giving enough help to consumers. Specifically, the report said that the FMCSA, among other issues:

  • Hasn't asked for more resources;
  • Hasn't collected and analyzed information;
  • Has conducted little public education.


Official Moving is the third moving company that the FMCSA has fined in the last month.

FMCSA officials say that motor carrier safety remains the agency's primary function, although they released a plan in December to address some of the problems in the moving industry. The agency, for example, now has a 24-hour toll-free driver safety hotline for consumer moving complaints.































































INTERWORLD INTRODUCES ENTERPRISE COMMERCE ROI ESTIMATOR

InterWorld® Corporation, a leading provider of enterprise commerce software solutions, today announced the availability of its "ROI Estimator"-- a tool for enterprises to use in planning their e-business strategies. InterWorld's ROI Estimator helps companies analyze their current overhead and administrative costs and compute the potential cost savings and sales advantages that can be realized by adopting an enterprise commerce software solution, such as the InterWorld Commerce SuiteTM.

"In this tough economic climate, companies need compelling and detailed justification before they can invest in e-business technologies," said Mike Morini, executive vice president of sales and marketing, InterWorld. "InterWorld's ROI Estimator is designed to give companies a definitive sense of return so they can factor future gains into their decision-making," added Morini.

InterWorld's ROI Estimator gathers company information step-by-step through a simple user interface. Business managers are asked questions on customer retention, inventory costs, customer service costs, order processing costs and other areas impacted by the InterWorld solution. At the end of the assessment, the ROI Estimator calculates the internal rate of return and presents a line-by-line report of projected savings and benefits of the project.

"The short and long-term advantages of becoming an e-business are evident from a strategic and quality of business perspective, but often hard to quantify, especially given all the hype and criticism of the Internet economy," continued Morini. "Businesses need to understand the inherent savings and powerful sales models made possible by the Internet. The ROI Estimator offers the kind of customized information companies need to see, derived from their own unique positions, as they plan their online strategy."

































































TECHNOLOGY CONTINUES TO DRIVE ECONOMY

Technology has had a tremendous impact on the warehouse over the last five years. A new study released by The Conference Board says that technology — in the form of computers, electronics, peripherals and communications equipment — will continue to drive the U.S. economy.

"While the 'tech' sector will be a dominant force for decades to come, it is also sensitive to current economic conditions because communications and information technology are now embedded in so many products and services," says Gail D. Fosler, senior vice president and chief economist of The Conference Board. "Such sensitivity can result in almost breathtaking volatility. The intense strengthening of the U.S. economy this year is likely to underpin a new, more moderate, 'tech' cycle."

The Conference Board indicates that business investment in information technology is increasing at an annual average rate of 14 percent per year, with real capacity growing almost 30 percent a year for the past 30 years. Today, information technology is a $600 billion to $700 billion business, accounting for about 7 percent of the U.S. economy, and close to one half of all business investment.

Latest factory goods orders suggest that total tech new orders are at a low point, with tech orders slipping to between -2 percent and 8 percent annual growth rates. But this weakness in technology is not evenly distributed among the key sectors.

Communications equipment orders and electronics are declining for the first time since 1991 and are considerably weaker than computers and peripherals orders. While new tech orders move in tandem with corporate profits, new orders for technology equipment appear to lead corporate profits.

The good news, according to the report, is that all of the tech sectors appear to be at levels, relative to historical trends, that would suggest a relatively quick recovery. These order rates are currently at levels not seen since the 1991 recession. The tech sector should re-accelerate along with the rest of the U.S. economy in the coming months.

Virtually every sector is increasing its information technology and communications capacity at rapid rates. Although services account for 75 percent of all information technology spending, manufacturing is increasing its IT capacities at 10 to 15 percent a year, with spending likely to accelerate at the end of this decade.






























































CALIFORNIA CONSIDERING TRUCK-ONLY LANES

In order to alleviate traffic congestion on heavily traveled California Highway 60, state highway officials are considering adding truck-only lanes and exits to the crowded road.

The improvements would come at a steep price, however. Construction costs are estimated to be $4 million, and truckers would likely be required to pay a toll to use the road, which is now free.

Warren Hoemann of the California Trucking Association said easing traffic congestion on the road is a major issue in the area.

"The CTA was in on discussions on how to improve things," Hoemann said. "Traffic congestion is the No. 1 transportation issue in California."

Hoemann said the main contributor to congestion on Highway 60, also known as the Pomona Freeway, was the high number of trucks using the road to transport intermodal containers from nearby docks to inland warehouses.

A sticking point to the plan is the toll proposal. "We’ve always been opposed to converting free roads to toll roads, although these would be new lanes," said Hoemann. "But this project will cost about $4 billion, and it comes down to how to finance it."

Hoemann said costs should spread among all who will benefit from the presence of the truck-only lanes. Passenger vehicles, Hoemann noted, would be able to travel quicker once the truck lanes are installed. "There are benefits here to drivers of automobiles, too," he said. "Some of the cost needs to be picked up by those drivers."

Hoemann also noted that traffic would be disrupted significantly during construction. Under the plan, a truck-only lane would be added to the right of the current lane array. Most of the 37-mile stretch under consideration for expansion has five lanes. Trucks would also have their own exits. In areas where room is not available for lateral expansion, trucks would travel on elevated lanes.

Hoemann said the plan will be effective only if other changes – particularly those concerning hours of operations of the docks and warehouses – are made at the same time.

"The point is, putting in a truck lane makes sense only when facilities along the route are open," he said. "The ports are open from about 9 a.m. to 5 p.m. The warehouses generally match those hours. During other hours, these lanes wouldn’t help. If you’re going to have the lane, make use of it through longer port and warehouse hours. You don’t want a great highway just connecting two parking lots."

Hoemann said 25 percent of all U.S. international trade uses the ports in the Los Angeles-Long Beach area, and subsequently Highway 60. By 2020, California traffic engineers estimate 46,000 trucks will use the road each day.































































SUPPLYLINKS FOLDS

SupplyLinks, the company formed a year ago by former Emery Worldwide and Circle International CEO David I. Beatson, has joined the transportation dot-com trash heap. After failing to drum up its second round of funding, SupplyLinks simply ran out of money and was forced to close its doors.

The company had secured $4 million in funding from Fremont Ventures, a venture capital company in Northern California, but the deal fell through after its lead sponsor abruptly left the company. SupplyLinks was left to scramble and came up short.

"The company was doing really well. They had a strong business plan and a pipeline of maybe 50 companies ready to sign up for the service," said spokesperson Dan Demaree. "If they could have gotten over the funding hump, they would have been home free."

Beatson managed to lure a number of former colleagues from Circle and Emery to sign on at the dot-com startup. Roger Curry, former CEO of Consolidated Freightways, joined the company as chairman of the board. The online transportation network was to be launched later this year. BAX Global, Central Freight Lines, Central Global Express, Exel, Watkins Motor Lines and Schneider Logistics had signed on as initial participants.






























































FMC CRITICIZES GRAIN SHIPPERS

The Federal Maritime Commission accused twelve grain companies of anti-competitive practices at their terminals on the Mississippi River. The FMC could serve the companies involved with a cease-and-desist order. The accused companies include Cargill Inc. and Archer Daniels Midland.

The dispute centers on exclusive contracts the companies have with tug companies that berth grain vessels at their facilities. According to the FMC the contracts reduce fair competition and increase costs for other grain carriers.

The FMC said it has received complaints from vessel operators and agents serving the lower Mississippi regarding the anti-competitive practices. "The information received by the Commission indicates that the practice complained of involves a dry-bulk terminal operator entering into an agreement with a single tug company to perform all regular tug assist services for vessels calling at its terminals," the FMC stated.

An analysis carried out by the agency showed that of the 2,952 dry bulk vessel calls in the lower Mississippi in 1999, 2525 of those calls were at terminals that are now closed. Thus, 89 percent of the dry bulk vessel calls in the lower Mississippi area were at terminals that now have exclusive tug contracts, it said.






























































BRICK-AND-CLICKS THRIVE ONLINE

Despite the gloom-and-doom of many pure dot-coms, the three-in-four Web sites that are part of the "Click-and-Brick" crowd see Internet revenues playing an increasingly dominant role in their companies in 2001 through 2003. For the 76% of online companies that also sell offline, the so-called "click-and-brick" businesses, one-third of revenues came from connections made on the Internet last year, and nearly half of all revenues for these companies will arrive from online contacts in 2002 according to ActivMedia Research’s latest report, "E-Survivors: Winning E-Commerce Strategies for 2001."

Click-and-brick companies may not seem sexy compared with the high-flying dot-coms, but each year they accrue increasing revenue from their online efforts. And, thanks to their mainstream product lines and well-established business capabilities, they are surviving where the "dot-bombs" are failing. According to the more than 500 online business executives that took part in this new research, growth rates for Internet contributions to "click-and-brick" business will soar over the next two years as their "Net-Centricity Quotients" continue to rise to become a majority of all company revenues by 2003.

According to Harry Wolhandler, VP at ActivMedia Research, "The success of online business may actually be contributing to the sense of economic decline in 2001in many companies in the U.S. and abroad. Such robust business gains among the online/offline vendors have to come from elsewhere in the economy. More specifically, companies that are not participating in the online growth spurt are losing share to those that are already online. Like it or not, the Internet is a fact of life for competitive business in the future. Mainstream businesses that create an effective synthesis of on-and-offline strategies are going to reap the benefits. Now that the dot-coms have turned into dot-bombs, the picture of what it takes to survive online is becoming much clearer."

























































SUPPLY-CHAIN SERVICE REVENUES $83BIL BY '05

A significant increase in business-to-business (B2B) e-commerce and the spread of Web-based communications will fuel the global supply-chain services sector, generating almost $83 billion in annual revenues by 2005, according to a study released today.

Researchers at IDC said the worldwide supply chain market generated $23 billion in 2000 and is on a pace that will bring it near the $83 billion mark in four years.

The IDC analysts found that North America and Western Europe represent the largest opportunities, together generating 95 percent of the market's worldwide revenues in 2000. In 2005, they will still hold a commanding 88 percent share.

Because North America was the first to embrace B2B, IDC program manager Ting Piper said in a statement, the region conducts the majority of supply chain services transactions. Additionally, both North America and Western Europe have strong traditions of outsourcing their supply chain implementations to third- party vendors, whereas organizations in other regions of the world rely more on their own internal abilities.

But, IDC said, other regions of the world will increasingly turn to supply- chain service providers through 2005. Revenues in the Asia-Pacific region will increase at a 53 percent compound annual growth rate (CAGR) through 2005, compared with a 29 percent CAGR for the overall market.

Industry-specific and collaborative supply chain projects will also present growing market-share opportunities, IDC said.






















































BNSF TEAMS WITH CSX INTERMODAL TO PROVIDE "ICE COLD" SERVICE

The Burlington Northern and Santa Fe Railway Company (BNSF) and CSX Intermodal (CSXI) have partnered to expand BNSF's Ice Cold Express service to the New York and New Jersey markets. This twice-weekly service between San Bernardino, Calif. and Little Ferry, N.J. began June 14. The service provides shippers with a fourth evening delivery, a full day faster than current rail transit times.

"With this temperature-controlled service, we're demonstrating that almost anything can now move by rail," says Clarence Gooden, CSXI president and CEO.

BNSF introduced the Ice Cold Express in 1999 as a weekly service for temperature-controlled products moving between Southern California and Chicago. Last October, the Ice Cold Express network expanded to include service to and from Montreal and Toronto.























































TRUCKER RECOGNIZED FOR RESCUING HIGHWAY WORKER


As he drove on Interstate 75 in Kentucky on a cold December morning, trucker Richard Kranz spotted a state highway salt truck driver who waved his left arm frantically.

"At first, I thought he might be waving hello," Kranz of Perrysville, Ohio, said. "But I decided to stop and check it out."

As Kranz approached the scene, he found that the man’s other arm was stuck in the spreader. The victim’s coat sleeve had gotten caught, and it had pulled his arm down into the machine.

After the highway worker told Kranz how to shut off the machine, Kranz worked to free the man from the spreader.

"I grabbed my crowbar and pried the spreader back to free his arm," Kranz said. "When I took his hand out, blood was squirting from the arteries."

Kranz's quick action saved the highway worker’s life, and it earned him recognition as a Truckload Carrier Association Highway Angel. For his efforts, he received a Highway Angel lapel pin, certificate and patch.

After he freed the worker, Kranz found materials in his truck that he used as a tourniquet for the man's arm; after he stopped the bleeding, he called for assistance on the two-way radio. The man began to fall in and out of consciousness while Kranz remained with him until a rescue squad and a state trooper arrived to help.

A 40-year veteran of the road, Kranz often has helped others on the road, but he said that he had never helped someone who was in such a severe situation. Kranz tried to check on the man’s condition, but there was no state police report filed because it was not a vehicular accident.

TCA’s Highway Angel program recognizes drivers for unusual kindness, courtesy and courage they have shown while on the job.




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