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January 18, 2019 | Vol. 69, No. 2

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In This Issue

Dear PEI Member:

The State of the Industry address during the 2018 PEI Convention revealed that PEI manufacturers' satisfaction with the state of their businesses is at record high levels — an overall score of 7.49 on a scale of 1 to 10. That compares with 6.87 in 2017 and 6.05 in 2015.

Data presented at last week’s Council of Manufacturing Associations’ winter meeting revealed manufacturers in other industries are equally confident. Chad Moutrey, chief economist of the National Association of Manufacturers (NAM), said that 88.7 percent of U.S. manufacturers have a positive or somewhat positive outlook on their businesses. According to Moutrey, this trend began in early 2017 and accelerated after the December 2017 passage of the federal tax reform package.

All this news is encouraging, exciting even. But the part of Moutrey’s presentation I found most interesting was the issues manufacturers are concerned about. Here are the top 10 business challenges manufacturers reported in the NAM survey:

Attracting and retaining a quality workforce 68.2%
Increased raw materials cost  65.1%
Trade uncertainties 60.4%
Rising health care/insurance costs 56.9%
Transportation and logistics costs 37.9%
Weaker domestic economy and sales 22.0%
Strengthened U.S. dollar relative to other currencies 21.4%
Unfavorable business climate (i.e., taxes, regulations) 18.5%
Weaker global growth and export sales 16.5%
Access to capital 4.4%

Whether you are a manufacturer, distributor, service contractor, affiliate or fuel marketer, take time to develop your own list of concerns, along with plans for how to tackle the biggest threats.

Good times are worth celebrating. But they don’t last forever. That’s why anticipating and planning for potential challenges is the mark of a truly well-run business.

Planning For Trouble

E15 Updates and Questions

Charles D. Kemp Scholarship Applications Open

Cadillac and Volkswagen Announce EV Plans



Respond to this Newsletter

by e-mail to the editor, Rick Long at rlong@pei.org

or join the discussion in the  Petroleum Equipment Forum

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The past two weeks have brought a flurry of developments on the E15 front. Here are the three biggest.

  • The Waiver. For several months, the U.S. Environmental Protection Agency (EPA) has insisted it will complete a rulemaking to waive summertime Reid Vapor Pressure restrictions on the fuel by June. Such a waiver will make possible the year-round sale of E15 throughout the U.S. However, because the rulemaking process is on pause thanks to the partial government shutdown, E15 advocates are questioning whether that timetable remains realistic. In his Jan. 16 confirmation hearing, Acting EPA Administrator Andrew Wheeler did little to clarify the matter, saying only that the agency will finalize the waiver in time for the summer driving season “provided we are back in a reasonable amount of time.”
  • Consumer Education Part 1. In a letter to the EPA, Reps. Austin Scott, R-Ga, and Lois Frankel, D-Fla., urged the agency to reduce the risk of E15 misfueling through enhanced consumer education and dispenser labeling requirements. “The proposed rule will significantly increase the risk of misfueling as more E15 fuel floods the market at a time of year when small engine use is at a peak, ultimately harming the millions of consumers who depend on a stable, safe fuel supply. It is imperative that EPA … fix its currently inadequate E15 labeling by including enhanced education measures and new labeling standards in any effort to expand the sale of E15.”
  • Consumer Education Part 2. The Renewable Fuels Association (RFA) launched an entirely different kind of consumer education campaign — touting not the dangers but the benefits of E15. Using the tagline “E15. Clean. Affordable. Domestic. Fuel,” the campaign began with digital ads in The Washington Post’s online edition and the launch of a new consumer website.

The PEI Foundation is accepting Charles D. Kemp Scholarship applications for the 2019-2020 academic year.

Each year, the PEI Foundation awards the $1,000 scholarships to deserving dependents of PEI member company employees. To be eligible, an applicant must be a dependent of a full-time employee of a member company in PEI’s manufacturer, distributor, service and construction, or affiliate divisions. The applicant also must plan to enroll as a full-time freshman for the 2019-2020 academic year at an accredited four-year college or university. Recipients are selected based on academic achievement, leadership, character, need and the applicant’s intent to contribute to the future of the fuel and fluid handling equipment industry.

For more information and to download the scholarship guidelines and application form, visit www.pei.org/foundation. The application deadline is March 31, 2019.

General Motors, which will cease production of the plug-in electric Chevrolet Volt this year, isn’t giving up on electric vehicles (EVs). At the North American International Auto Show in Detroit, the company unveiled concepts for a new Cadillac EV. CEO Mary Barra said the as-yet-unnamed model will be a true luxury vehicle designed to compete with Tesla and other high-end EVs.

Volkswagen will begin manufacturing electric cars at its Chattanooga, Tennessee plant, the company’s only U.S. production facility. Volkswagen is committing $800 million to the effort, which it expects will create 1,000 new jobs. The first U.S.-produced Volkswagen EV will be a compact sport utility vehicle called the I.D. Crozz. Production is expected to begin in 2022.  The Chattanooga effort is part of a broader Volkswagen initiative to manufacture EVs at eight sites on three continents.

Bill R White
of D&H/United Fueling Solutions will retire Jan. 31 after more than 60 years in the petroleum equipment industry. White was the 1997 PEI president and has been a longtime member of the PEI committees responsible for PEI/RP100: Recommended Practices for Installation of Underground Liquid Storage Systems and PEI/RP200: Recommended Practices for the Installation of Aboveground Storage Systems for Motor Vehicle Fueling. PEI is deeply grateful for the service this true gentleman has given the association and wishes him all the best.

Dover Corp.
entered into an agreement to acquire Belanger Inc. The transaction is expected to close in early 2019. Belanger will become part of the OPW business unit.
Equipetrol S.A. is celebrating its 40th anniversary of providing petroleum equipment solutions to fuel marketers and other customers in Colombia.
Oscar W. Larson signed an agreement to offer its customers Canary Compliance’s data-driven remote tank monitoring system for underground storage tanks.
Highland Tank & Mfg. Co. purchased certain assets of Clawson Tank Co., effective Jan. 2. Highland will continue to operate the former Clawson manufacturing facility in Clarkston, Michigan.
Petroleum Marketing Equipment (PME) will open a new facility in Las Vegas on March 1. This is PME’s third new location in three years and sixth overall.
Petro Service Ltd. announced its intent to purchase Edmonton Pump Service Ltd.
The transaction is expected to close by Feb. 15.
Petroleum Solutions Inc. (PSI) entered an agreement with Radi8 Solar under which PSI will offer solar panel systems as an alternative energy source to new and existing customers. 
Riverside Steel Inc. appointed P & G Marketing and Associates its representative for Illinois, Wisconsin, Minnesota, Iowa, Kansas, Missouri, South Dakota, North Dakota, Nebraska and northern Michigan.

“Mexican President Andres Manuel Lopez Obrador is urging the country to remain patient as gasoline shortages stretch into their second week
while he battles to stem fuel theft at pipelines. Lines of cars at service stations across Mexico stretch for blocks, with some drivers turning up well before trucks arrive with fuel. In the State of Mexico on Saturday, residents rushed toward a punctured pipeline to fill plastic containers with fuel.” — The New York Times, Jan. 13, 2019
“A Washington state bill that would establish a Clean Fuels Program beginning in 2021 was introduced this week as the state seeks to establish a program similar to California and Oregon. The measure (H.B. 1110) was introduced by Rep. Joe Fitzgibbon, a Democrat. It is modeled after a bill Fitzgibbon introduced last year, which was approved by a House committee but never made it to a House vote. The program would aim to reduce greenhouse gas (GHG) emissions from transportation fuels to 10% below 2017 levels by 2028 and 20% below 2017 levels by 2035.” — Oil Express Alert, Jan. 11, 2019

Colorado service company.
Petroleum Equipment Maintenance LLC, 3829 W. 118th Mews, Westminster, CO 80031, applied for service and construction division membership. Douglas Francis Morrissette is owner of the firm, which was established in 2017. Petroleum Equipment Maintenance LLC specializes in troubleshooting and repair of petroleum equipment and associated software. Sponsored for PEI membership by Eric Hick, CGRS Inc., Fort Collins, Colorado.

Canadian construction company. Protec Petroleum, 10-1395 Stevens Road, West Kelowna, BC V1Z2S9, Canada, applied for service and construction division membership. Brian Pittenger is president of the firm, which was established in 2001 and has multiple offices. Sponsored for PEI membership by Tiina McCombie, National Energy Equipment Inc., Mississauga, Ontario, Canada.

Malaysian service provider. Profuel Engineering Services, No. 19 Jalan Kemuning Damai 32/147A, Shah Alam, Selangor Darul Ehsan 40460, Malaysia, applied for service and construction division membership. Kularaman Mutu Raman Chettiar is business development specialist for the company, which was established in 2012. Profuel Engineering Services is a service provider for pump dispensers and tire inflators. Sponsored for PEI membership by Ben Stallings, Fatboy Electric Inc., Kansas City, Missouri.

Puerto Rico environmental firm. Altol Environmental Services, P.O. Box 359 Mercedita, Ponce, PR, 00715, applied for affiliate division membership. Jose Perez is supervisor for the company, which was established in 1992. Altol Environmental Services provides comprehensive environmental engineering services, including environmental consulting, air monitoring, monitoring of fugitive dust and environmental hygiene. Sponsored for PEI membership by Danny Brevard, Accent Environmental Services Inc., Lufkin, Texas.


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© 2019
Petroleum Equipment Institute
P. O. Box 2380
Tulsa, OK 74101-2380

The TulsaLetter (ISSN 0193-9467) is published two or three times each month by the Petroleum Equipment Institute. Richard C. Long, Editor. Opinions expressed are the opinions of the Editor. Basic circulation confined to PEI members.