Little strokes," Benjamin Franklin reminded us, "fell great oaks." And so it is with the "Y2K" (geek shorthand for "Year 2000") computer problem that threatens to plague businesses for at least another year.
The Y2K clock will literally run down to zero when the stroke of midnight ushers in January 1, 2000. At that moment, any computerized system that is not Y2K compliant will probably stop functioning properly.
How big a disaster getting dialed back to 1900 may be is anybody's guess. Chances are if the affected computer is a PC sitting home alone, no one will notice. However, if the computer in question drives your fleet's business systems, it would be the height of folly not to plan for the worst.
The nightmare scenarios that may result from not squashing the millennium bug in advance run a grim gamut from disappearing bank accounts to unguided aircraft aloft.
Yet with zero hour fast approaching, there is no time to lose one's head over doomsday talk. Y2K compliance can be attained computer by computer, company by company, by calmly but diligently executing a step-by-step process.
Three Steps Here's such an approach, culled from the reams and streams of Y2K advice now flooding printed and electronic pages everywhere.
Step One: Assess risks. As always, the best place to begin is at the beginning. So start by reviewing your fleet's existing computerized business systems for Y2K compliance. If your stuff is new enough, it may have been designed free of the millennium bug.
Step Two: Reach out. Your fleet's Y2K compliance will be only as good as that of vendors and customers whose computers interact with yours.
Step Three: Take action. Okay, so several years ago yesterday would have been a good time to start on all this. But look on the bright side. Now, there's plenty of inspirational pressure on you to defuse the Y2K time bomb before hitting the deadline.
Risky business Assess risks by not overlooking any computer hardware and software -- including any equipment with embedded data chips.
Start by contacting computer suppliers to verify if your machines are already Y2K compliant. Software vendors should be able to verify if their programs will process dates later than 12/31/99. Homegrown "user-created" programs must also be examined and modified if need be.
A big area of risk easily overlooked is any equipment with embedded computer chips or processors. This means any electronic devices that track date by year, including anything from phones and security systems to automatic gates and elevators.
It's also essential to find out if any computerized data shared or exchanged with outside parties records years in two-digit format. To cover all the bases, check this out with all customers, suppliers, and regulatory agencies with which you interchange data.
Crucial calls Reach out by contacting vendors and customers to learn how far they've advanced on the Y2K front. No line of attack is stronger than its weakest flank.
Suppliers of everything from parts and service to public utilities and banking services must be Y2K compliant or your fleet could be left high and dry. If they can't ensure they will be up and running in 2000, too, now's the time to search out alternative sources. Remember your needs -- and your customers' -- come first.
Speaking of customers, don't leave them out of the loop, either. Since they pay the freight, you'll have to approach their Y2K status more gingerly. Nonetheless, if important customers don't squash their millennium bugs, come 2000 they may not be in business to do business with you. Best course of action is to help them help both of you.
Smart fixes Take action by making "fixes" and carefully testing the results. Also, as the federal Small Business Administration (SBA) advises, be sure to develop contingency plans to handle Y2K-related problems outside your immediate control.
"Fixing most Y2K problems is not particularly complicated," says SBA administrator Aida Alvarez, "but it can be labor-intensive and time-consuming."
Alvarez warns that "last-minute fixes" won't wash. "You need time to test your system to ensure the 'fix' you've installed works. Businesses need to have compliant systems in place for a considerable period of time -- such as a fiscal year -- to ensure that errors have been removed."
Yellow light The biggest problem facing fleets that haven't started on Y2K yet may be finding enough trained personnel -- and paying them enough-- to get the job done on time.
Even a giant of road transportation like Yellow Freight System had to put together a dedicated team to tackle its Y2K challenge.
According to Michelle Cammarata, senior manager of Yellow's Year 2000 Project, the carrier assembled 100 of its technicians, programmers, and managers. The full-time team has been on task since early '96.
"We've spent thousands of man-hours reprogramming, purchasing, and reinstalling hardware and software, and disabling non-compliant systems," Cammarata points out, "as well as communicating with critical suppliers and customers, and performing countless other tasks."
The upshot of this Herculean effort? The carrier reports it will complete its Y2K compliance project by the end of this month. Final touches will be added by spring. Yellow plans to use the remainder of '99 for "rehearsal and testing" of all critical systems and components.
"We do not expect disruptions," states Bill Zollars, president of Yellow Freight. "When we celebrate the start of the Year 2000, we will be conducting business as usual."
Failure no option When all's said and done, the only way the millennium bug can bite your fleet bad is if you let it -- whether by too much complacency or too little diligence.
Do not despair if some Y2K solutions seem less than elegant. Failure was not an option either when Apollo 13 went awry. The celebrated gizmo fabricated with duct tape and odds and ends that kept the mission's crew alive wasn't pretty. But it worked.
Likewise, the myriad business risks your fleet faces aren't worth failing to do all you can to squash the millennium bug in the time remaining.
And should the Y2K timetable still seem hopeless to meet, consider this observation by noted futurist George Orwell. "The quickest way of ending a war," said the author of 1984, "is to lose it."
Web sites offering a fistful of Y2K info include:
*.Small Business Administration: www.sba.gov/y2k/
*.Yellow Freight System: www.yellowfreight.com/new/y2k.htm
*.Orbtech/Y2K Experts: www.y2kexperts.com
*.Ziff-Davis Inc.: www.zdnet.com/zdy2k/
*.Infrastructure Defense Inc.: www.y2ktoday.com
Time's up! December 22, 1998, is the deadline for removing or upgrading any underground fuel storage tanks that do not meet EPA requirements. Tanks installed after December 1988 must already meet the new standards; those installed prior to December 1988 have until December 22 to meet the spill, overfill, and corrosion protections requirements. Those that don't must be replaced or closed.
Repeat this OSHA will publish its ergonomic rules next September, according to a regulatory agenda published last month in the Federal Register. The notification was the first solid indication that the agency will move ahead with rules governing repetitive motion, which trucking so vehemently opposes.
Driver grant In response to the nagging driver shortage, the Dept. of Labor (DOL) will shell out more than $1 million to help train dislocated workers to drive trucks. Classes will be conducted at driver-training centers in Pennsylvania and Tennessee. The American Trucking Assns. plans to use the SCHEIG truck driver assessment tests to screen candidates for the driver recruiting and training program recently launched in conjunction with DOL.
New reporting rules The Bureau of Transportation Statistics has proposed new accounting and reporting rules it says would provide information the agency needs, while at the same time reducing the compliance burden on motor carriers. Under the plan, Class I motor carriers would file much shortened quarterly reports as well as a simplified annual report form based largely on the current Form M-2. Class II carriers would continue filing only annually and would use the same simplified form as Class I carriers. Class III carriers are exempt from financial reporting.
Impact on recent elections gives Teamsters boost
The election that brought down House Speaker Newt Gingrich also brought a boost to organized labor. "They feel strongly that they played a significant role in the election results," said Tim Lynch, president of the Motor Freight Carriers Assn.
Labor's winning strategies this year got an early start. In June, California's Proposition 226, sponsored by conservative Republicans, was supposed to weaken labor's role in politics by making it almost impossible for organized labor in the state to participate in any election. Because labor was able to educate voters, however, the proposition was defeated. Labor played significant roles in other elections around the country, including several crucial gubernatorial races.
Spokesperson Craig Merrilees noted that the Teamsters have many political concerns in 1999, including NAFTA provisions that have yet to be implemented.
Another issue is ergonomics. "UPS has tried to stop ergonomics protection for its workers," said Merrilees. In the past, UPS has denied these charges. The Teamsters are also watching the current regulatory fight over hours-of-service rules. "I think we'll find a lot of support from the public if the government tries to cut drivers' rest times," predicted Merrilees.
While these issues are on the Teamsters' minds, nothing is set in stone until a new president is elected and his political initiatives are known. Ballot counting on the 1.4-million votes was expected to begin on December 3. With challenges expected to take several weeks, certification of a new president to finish out Ron Carey's term, which runs until 2002, could be accomplished by December 25.
According to Jerry Nerman, co-founder and chairman, Arrow Truck Sales Inc. expects that Volvo Trucks North America's planned investment in the firm will enable it to more than double the number of its sales branches.
Already the nation's largest independent used-truck outlet, Kansas City, Mo.-based Arrow currently operates 16 branches "stocked with some 2,000 reconditioned trucks and trailers," says Nerman. Volvo's stake in Arrow's ownership will help raise the number of branch locations to 40 or even 50.
"Our agreement with Volvo Trucks allows us to perpetuate Arrow as a company," Nerman advises. On the other hand, the deal will help broaden the company's perspective. "Their executives will be the first outside directors on our board," he notes.
For its part, Volvo Trucks has stated that it expects the partnership will help its 200 or so U.S. and Canadian dealers strengthen their own used-truck operations by giving them access to Arrow's expertise.
New Year's Day will bring a bevy of tax changes for trucking employers and independent contractors in 1999. As always, income tax withholding tables and the social security wage base, or maximum earnings that are subject to the non-medicare portion of social security tax, will change in line with inflation over the previous year. Because inflation has been so low, those adjustments will be lower than usual, however. Also look for small changes in the Internal Revenue Service's annual revenue procedure covering per diem rates and the list of localities for which higher per diems apply.
In the first year of its existence, Sterling Trucks' performance has exceeded all expectations. That's the word from John Merrifield, senior vp-sales and marketing. As of October, the company had built 12,000 units, which is 50% ahead of Ford's best year for its HN80 model. Sterling is the heavy-truck business Ford Motor Co. sold to Freightliner Corp. last year. On top of that, there are 25,000 trucks on the order boards.
The success, according to Merrifield, is being driven by two factors. On the highway side of the business, manufacturing continues to pump freight into the trucks. And on the vocational side, construction continues to run ahead of expectations, fueled by the massive highway bill passed earlier this summer.
Looking beyond the numbers, Merrifield points out that customers are more receptive to having manufacturers help them spec trucks, and are also looking to the truck builder for aftermarket product and service support.
"Customers are asking more of our dealers than ever before," he said in an interview with FLEET OWNER. "In turn, we are asking more of our dealers."
The first thing fleets will notice coming from the 235 North American Sterling dealers will be expanded hours of operation to satisfy the customers. The new 24-hour-a-day and 7-day-a-week service expectation is expected to lead to some rationalization of the dealer network.
As for expansion into Mexico, Merrifield said: "We have to look at the total North American market. All I'll say at this point is don't miss our next press conference."
Eaton Corp. and Dana Corp. will extend their agreement covering the Roadranger System of drivetrain components and services into medium-duty components, as well as heavy-duty product lines not covered in the original agreement. Eaton will have marketing responsibility for all medium- and heavy-duty components and systems.
Frank Sheehan, vp-sales and marketing for Dana's Heavy Truck Group, says that it makes "good business sense to expand and simplify the program to include the entire line of medium and heavy truck components and systems. Our customers will have only a single point of contact for the Roadranger System." Adds Ken Davis, North American marketing manager for Eaton Truck Components, "The expansion of this agreement answers our customers' demands to 'make it simple' -- to give them a single source, a single company, a single person to call -- for all their drivetrain needs, regardless of the size of their trucks." Field sales, service, and parts support will continue to be provided by the Roadrangers.
The Roadranger System is a comprehensive array of drivetrain products, services, and support and features Eaton Fuller clutches and transmissions, Dana Spicer axles, brakes and wheel ends, and Eaton ABS. The products are available separately or as a complete drivetrain system, and are marketed by Eaton at the OEM and fleet user levels.
In a related move, the Spicer Heavy Axle and Brake Div. of Dana rationalized its lineup of components following its acquisition earlier this year of Eaton's heavy axle and brake assets. Spicer Heavy Axle & Brake products now include:
*.Tandem drive axles for linehaul and construction applications, rated from 34,000 to 45,000 lb. gross axle weight rating (GAWR) including the 40,000-lb. DS404 tandem.
*.Tandem drive axles for heavy haul, logging, mining, construction, and oil field applications, rated from 46,000 to 65,000 lb. GAWR.
*.Single drive axles for city delivery and bus or coach applications, rated from 13,500 to 22,000 lb. GAWR.
*.Single drive axles for linehaul and refuse applications, rated from 23,000 to 30,000 lb. GAWR.
*.Steer axles rated from 6,000 to 24,000 lb. GAWR featuring the lightweight integral knuckle models.
*.Brake components, including a new line of extended service brakes and slack adjusters.
Highlighting the new lineup and rationalization of Spicer Heavy Axle & Brake products are several enhancements:
*.The new Dana Spicer DS404 tandem axle family is now 15 lb. lighter than previous models with the addition of a new output cover to provide better output shaft alignment and sealing performance and redesigned power divider unit.
*.Enhanced lubrication flow also resulted with a new, upgraded power divider unit (PDU) in all DS404 axle family members. The addition of a redesigned lockout shift system, improved cover-to-carrier-joint geometry, and a larger oil trough, allow for increased lubrication flow, enhanced sealing, and improved performance in most severe applications.
*.A new ratio of 2.93 has been made available on the DS404 for linehaul applications. The ratio complements Dana's broad ratio offering, which currently includes ratios as fast as 2.64.
The company also announced a new GCW rating for the Dana Spicer 23105S single drive axles. Ratings have been increased from 105,000 lb. to 120,000 lb. for on-highway applications.
To tap into the equity in the International name, Navistar International Corp. announced a new branding initiative that will attach the International name to all products and services. Navistar will refer to the name of the holding company and be used in stock prices and earnings. The initiative is being supported with a national advertising campaign.
"International stands for reliability, durability, and good value in our customers' minds," explained John Horne, chairman of Navistar. "This new campaign drives home the point that even as our customers' needs change, we are out in front. We will deliver products, technologies, and services built on the foundation we're known for -- and we'll go beyond what the customers expect today."
The company also announced two new T444E diesel engines for fleets that need vehicles with low-emissions ratings. The new powerplants, available in seven of the company's 4700 medium trucks, school bus chassis, and stripped chassis, are rated at 175 and 195 hp.
Navistar said it also had received Continuing Automotive Service Education (CASE) certification for its in-service medium and heavy truck technician training program. The award "verifies to our dealers that we are continuously striving to bring the best and the most current training to them and to their technicians," said Don DeFosset, president of Navistar's truck group. "It also shows that we are committed to keeping our customers' freight moving by leveraging the industry's largest dealer parts and service network with outstanding service support."
In other developments, Navistar announced:
*.It will supply some 2,200 conventional 9200's to Wal-Mart Stores through the year 2001.
*.The company's Diamond SPEC program, which groups specs together for a simplified truck-ordering process, now accounts for 7 out of 10 dealer stock orders in the medium-duty product line, and 8 out of 10 heavy trucks ordered.
*.An internal quality-improvement program has resulted in a 30% improvement in "build" quality in the last six months at the company's Springfield manufacturing facility.
*.Navistar's Escobedo, Mexico, facility is now complete and building 12 trucks a day. All told, the company will sell about 4,000 Internationals in Mexico this year -- about 50% more than planned -- through 42 dealer locations.
*.Assembly and sales of International medium-duty trucks in Brazil is running at 60 trucks a month out of the company's Caxias facility.
The following company should be added to FLEET OWNER's October Buyers' Directory: BP Oil Co., 200 Public Square, Cleveland, Ohio 44114, 216-586-2163; 216-586-3457 (fax). Product categories include hydraulic fluid, conventional oil, synthetic oil, and chassis lubricants.
Insurance and risk management services provider Liberty Mutual Group recently surveyed more than 100 trucking industry senior managers to help identify the key risk management issues for today's fleets. Driver-related issues, such as recruiting, retention, and training, topped the list for 53% of the respondents, followed by structuring insurance programs and controlling costs (36%). Driver safety and loss prevention issues were third -- cited by 32% of the respondents as being the greatest risk management issues they face today.
Among those surveyed, 67% of the smaller fleets (250 or fewer employees) reported that managing driver issues was their number one concern, while just 38% of the larger fleets (more than 250 employees) surveyed shared that perspective. Driver-related issues are expected to continue in the number one spot for the next two years, however, according to 33% of all executives surveyed.
Other survey findings included:
*.66% of those surveyed named industry trade publications and journals as their top source for information about government legislation and regulation, 42% cited state trade associations, and 36% gave the nod to ATA. Surprisingly, the Internet anchored the last spot for news at just 8%.
*.Four out of five executives surveyed (79%) said they communicate electronically with their customers.
*.Most respondents (66%) said they used the Internet in the past year, primarily for gathering information on competitors. Over half the respondents have used the Web to recruit employees.
*.Management's five greatest concerns: availability of qualified drivers (93%), retention of drivers (89%), public perception of the trucking industry (73%), DOT regulations (62%), and information technology (56%).
*.Other areas of concern: driver ergonomics (44%), logistics management (36%), cargo theft (30%), and industry consolidation (28%).
"Liberty Mutual is committed to helping trucking companies address these issues," said John Ryan, vp-commercial marketing. "Programs such as Decision Driving training and our research on driver fatigue assist companies in managing driver issues. Our innovative insurance programs that include proven loss prevention consulting services help our customers improve their results and control their costs."
With the long-anticipated introduction of a new truck just months away, Mack Trucks is reporting closing out 1998 with all the fundamentals of its business in strong shape, according to Paul Vikner, exec. vp-sales and marketing for the Allentown, Pa.-based manufacturer.
"We have a backlog of 25,000 trucks," he reports. "Business has been almost out of control." But he reports that Mack has amended its order control policy with dealers, putting them more on an allocation basis in an attempt to take as much risk out of the backlog as possible. Still, the order intake is solid and there is "less water" than there's ever been, he says.
Vikner expects the fundamentals to remain solid. "Customers and dealers still are confident about next year," he says. And with production evenly divided between its vocational and highway business, Mack is well positioned to take advantage of the strong truck market.
Not only do customers continue to feed demand for new product development, they are changing the ways trucks are ordered and maintained, Vikner said. "More and more fleets are asking us to do more for them," he explained. "They aren't insisting on certain specs as much as they used to; the decision is becoming more financially driven."
Although Vikner and Steve Homcha, vp-engineering, were mum on the new product, they did say that it was not designed for the current customer but is targeted at "markets we're not strong in."
One wild card in the performance of the industry will be the consent agreement major heavy-duty engine makers signed in October with the Environmental Protection Agency relating to exhaust emissions. However, the agreement is not expected to have much of an impact on Mack's operation, according to Homcha. He said neither the company's 40,000-mile service interval nor its engine life to first overhaul would be affected.
Park N' View (PNV), the in-cab cable television, fax, Internet, and phone service provider, and TravelCenters of America (TA), the nation's largest full-service truckstop operator, recently announced a partnership in principle specifying PNV as the primary provider of internal and external telecommun ications services for TA. The announcement was made during the ATA Management & Conference Exhibition in New Orleans last month.
"We were looking for the total solution," said Mike Hinderliter, senior vp-marketing for TA. "[Park N' View] is the only provider offering in-cab access to the Internet and cable television."
Internal voice and data services are bundled with external pay telephone, prepaid phone card, and in-cab services including in-cab Internet under the new agreement. Both companies will market these expanded services to TA's professional driver customer base.
"Up to now, our private voice and data network was accessible only inside the truck," said Alex Ezazi, vp-marketing for PNV. "This will give drivers access inside the stop as well and enable fleets to work through one provider."
Dryden Oil Co., the heavy-duty lubricants company of Castrol North America, announced last month that effective January 1, 1999, it will change its name to Castrol Heavy Duty Lubricants Inc. According to Jeff Farley, president and CEO of Castrol Heavy Duty Lubricants, "The name change will facilitate growth of our commercial business in North America." With a primarily East Coast distribution network, Dryden Oil has achieved a strong market share in the Mid-Atlantic region. The company expects the Castrol name to help expand product influence to the rest of the country.
Castrol Heavy Duty Lubricants will operate as a standalone unit of Swindon, U.K.-based Burmah Castrol PLC, which bought Dryden Oil in 1991. The Baltimore-based company will now have global responsibility for marketing heavy-duty lubes for both off-road and on-road commercial applications. Currently, Dryden products represent about 40% of Castrol's worldwide commercial business.
Castrol Heavy Duty Lubricants plans to retain Dryden product brand names such as Dieselall, Dieselall Plus, and Supreme; beginning in January they will be available as Castrol Dieselall Plus, etc.
Although the products will remain the same, the company is making one packaging change: the introduction of a user-friendly one-gallon diesel oil container for its diesel oils. With a retractable pour spout, the container makes it easy to dispense and re-seal. The new jug also has a vertical see-through strip with incremental measurements that tell users how much oil has been used.
The company's core specialty business will continue to be oils and lubes for heavy machinery and trucks used in construction, quarry, and fleet sectors.
