Eaton truck unit receives major contracts

CLEVELAND, OHIO.... Eaton Corporation (NYSE:ETN) today said its Trucking Information Services Division (TISD) has recently received more than seven million dollars in contracts for the purchase of its new transportation logistics management system.

Eaton's Fleet Advisor® system, which features an integrated information technology system that enables trucking companies to manage shipments "on the fly", recently has been selected by Harley-Davidson Transportation, Associated Grocers, Cenex Harvest States, Fox Bus Lines, GFG Food Service, Leviton Manufacturing Co., Wallace Hardware and Praxair, Inc.

The Fleet Advisor system integrates on-board computers, satellite communications and Microsoft WindowsNT software to provide significant vehicle, driver and cargo management flexibility. Both hardware and software are installed on the truck and in its cab, as well as at the trucking operations' base facility.

"In most cases, heavy trucks are really rolling warehouses involved in just-in-time deliveries," says Thomas W. O'Boyle, Senior Vice President - Truck Components for Eaton. "Our Fleet Advisor system gives the trucker and truck fleet management team virtually all of the computerized management tools that exist at a stationary facility, and it gives it to them on a real-time basis."

For drivers, the system eliminates time-consuming paperwork in maintaining Department of Transportation hours of service driver logs, International Fuel Tax Association compliance, and reports to dispatchers and managers. For transportation managers, it permits real-time routing and re-routing of trucks, better backhaul management and improved responsiveness to emergencies and breakdowns. The Fleet Advisor system technology, through its Microsoft WindowsNT-based office computer, also links vehicles to "back office" accounting and purchasing functions, again on an immediate basis.

On-board computer-based logistics systems will be an industry standard in the near future, O'Boyle believes. "We think real time information will be the next area of transportation management revolution for American business. Transportation logistics — getting finished goods from the manufacturer's loading dock to the customer's shelf on time— now represents 25 percent of the total cost of a product.

"Eighty percent of all goods move by truck. It is a $480 billion business in North America, and we estimate that $250 billion is spent yearly on owning, operating and maintaining trucks. In an industry where profitability is often measured by a half-cent improvement in cost per mile, the Fleet Advisor system provides competitive advantage," O'Boyle says.

"We don't believe there is a company in America that hasn't made inventory management a top priority, and we haven't seen a mission statement for a trucking company that doesn't have customer satisfaction in the first paragraph," O'Boyle continues. "The Fleet Advisor system directly supports both of those priorities."

O'Boyle is optimistic about the future for truck information systems. "Although the Fleet Advisor program began as a start-up business just a few years ago, by last month we had exceeded a million dollars in monthly sales. For the future, we see TISD sales exceeding $100 million by 2001, and continuing to grow significantly thereafter. While we do have competition, Eaton cut its teeth in the trucking industry. We've been supplying components and systems to the industry for over 88 years. We know the business, we know the customers and they know we're committed to the industry.

"Eaton Truck Components business had global sales approaching $1.5 billion to the industry last year. Our competitors in the area of logistics management are basically trip recorder or communications 'pieces and parts' makers, and that kind of an approach can create nightmares for truck fleet systems purchasers. With Fleet Advisor, Eaton can deliver a robust systems solution which meets its customers' needs," O'Boyle says.

Eaton Corporation is a global manufacturer of highly engineered products that serve industrial, vehicle, construction, commercial and semiconductor markets. Principal products include electrical power distribution and control equipment, truck drivetrain systems, engine components, hydraulic products, ion implanters and a wide variety of controls. Headquartered in Cleveland, the company has 49,500 employees and 155 manufacturing sites in 25 countries around the world. Sales for 1998 were $6.6 billion.



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Renald Romain


William Hartman, vice president, Investor Relations