Today's Top Supply Chain and Logistics News From WSJ
January 04 2017 - 7:12AM
Dow Jones News
By Paul Page
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The biggest provider in Amazon.com Inc.'s dedicated air cargo
network is expanding its reach into the airline industry. Air
Transport Services Group Inc. bought Pemco World Air Services Inc.,
the WSJ's Doug Cameron reports, taking in a major provider in the
world of aircraft maintenance and passenger-to-freighter jet
conversions. The acquisition brings the cargo airline a company
that is in the business of turning into freighters the sort of
Boeing Co. 737 aircraft that experts expect to figure prominently
in new China domestic cargo services. Pemco also specializes in
maintenance for Boeing 767 jets, the centerpiece of Amazon's
outsourced Prime Air cargo airline, allowing ATSG and Amazon to
keep more of that operation within a closed system. Pemco doesn't
perform cargo conversions for 767s, but some financial support
could change that and bring even more airline business under
Amazon's expanding transportation umbrella.
President-elect Donald Trump's pick as the nation's chief trade
negotiator is a veteran trade lawyer with a background well-suited
for an administration intent on curbing imports. The WSJ's William
Mauldin writes the choice Robert Lighthizer as U.S. trade
representative signals a sharp shift in trade strategy that will
include a move away from multilateral deals, a tougher approach to
China and Mexico and the threat of duties to impose higher costs on
imports. That focus on imports has raised concerns in a retail
world that depends on products made overseas, and Mr. Lighthizer's
appointment suggests that trade flows are in for a big change. A
former deputy USTR during the Reagan administration, he's spent
three decades as a trade lawyer fighting for punitive tariffs on
U.S. companies' overseas rivals and backed tariffs to defend the
U.S. steel industry against overseas competitors.
The future of North America's automotive supply chain appears to
be running through President-elect Donald Trump's transition
operation. Ford Motor Co. is scrapping plans for a new, $1.6
billion small-car assembly plant in Mexico even as General Motors
Co. takes barbs from Mr. Trump over cars it imports from Mexico to
U.S. dealers, the WSJ's John D. Stoll and Mike Colias report. The
surprise turnaround from Ford upends the car maker's longstanding
strategy and will trigger a broad rewrite of parts distribution
plans set to serve the factory. Ford instead will make small cars
in an existing Mexican factory and invest $700 million in a
Michigan facility that will build electric vehicles. GM hasn't
taken any formal response to the barb Mr. Trump threw its way over
Twitter, but the new controversy may complicate the auto maker's
attempt to reset its manufacturing by scaling back production of
smaller cars as U.S. buyers turn toward SUVs and trucks.
ECONOMY & TRADE
The rising value of the dollar that's drawing cheers on Wall
Street may spell trade trouble in other countries. The soaring U.S.
currency is sending a cloud over emerging markets, the WSJ's Ira
Iosebashvili writes, where the dollar's sustained strength could
undercut prices for oil and other dollar-denominated commodities.
That would particularly pressure developing economies that export
raw materials that are highly sensitive to currency changes.
Emerging-market companies and governments that have borrowed
heavily in the U.S. currency will also find their debt more
difficult to service. The dollar is starting 2017 strong, reached
its highest point since June 2002. The rise is already having an
impact in China, the WSJ's Linling Wei reports, as the large pile
of foreign debt owed by Chinese companies add urgency to Beijing's
efforts to keep the yuan from falling too steeply. The tighter
control on capital outflows is aimed at maintaining China's
economic equilibrium but it will also keep trade on an even keep
even if the dollar keeps bulking up.
QUOTABLE
IN OTHER NEWS
A key measure of U.S. factory activity jumped in December to its
strongest pace in two years, with figures for new orders, prices
and production all soaring. (WSJ)
Tesla Motors Inc.'s fourth-quarter sales rose 27%, but the
company fell short of its goal of delivering at least 80,000
vehicles in 2016. (WSJ)
Intel Corp. is seeking regulatory approval to take a stake in a
digital mapping service jointly owned by Germany's big three car
makers. (WSJ)
The Obama administration is finalizing a study that could lead
to restrictions on Chinese investment in the U.S. semiconductor
sector. (WSJ)
Brazil's imports plunged 20% last year as the country posted its
biggest trade surplus ever. (WSJ)
Korea Line Corp.'s board voted against having the bulk carrier
take over Hanjin Shipping Co.'s trans-Pacific container service.
(American Shipper)
China launched freight rail service between the eastern Zhejiang
province and London, extending its "Belt and Road" trade
initiative. (Bloomberg)
South Korea's Hyundai Merchant Marine struck an alliance with
two short-haul container shipping lines for intra-Asia service.
(Nikkei Asian Review)
Logistics software provider Descartes Systems Group Inc.
acquired trade data provider Datamyne for $52.7 million. (DC
Velocity)
Developers are planning a warehouse as large as 1.3 million
square feet in the increasingly tight distribution market outside
Chicago. (Crain's)
The addition of new passenger planes to meet strong air travel
demand in Asia is dragging down air freight rates. (Journal of
Commerce)
Bombardier Inc. delivered its first CRJ200 regional jet
freighter converted from passenger configuration to Gulf &
Caribbean Cargo. (Air Cargo News)
DP World took a controlling stake in the South Korean Port of
Busan's biggest container terminal. (Maritime Executive)
The U.S. Agency for International Development halted funding for
a Ukraine customs reform project, saying anti-bribe efforts at
Black Sea ports have stalled. (Reuters)
ABOUT US
Paul Page is deputy editor of WSJ Logistics Report. Follow him
at @PaulPage, and follow the entire WSJ Logistics Report team:
@brianjbaskin, @jensmithWSJ and @EEPhillips_WSJ and follow the WSJ
Logistics Report on Twitter at @WSJLogistics.
Subscribe to this email newsletter by clicking here:
http://on.wsj.com/Logisticsnewsletter .
Write to Paul Page at paul.page@wsj.com
(END) Dow Jones Newswires
January 04, 2017 06:57 ET (11:57 GMT)
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