Today's Top Supply Chain and Logistics News From WSJ
January 05 2017 - 7:15AM
Dow Jones News
By Paul Page
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A dispute between two of the biggest intermodal shipping
operators in the U.S. will put the changing business of truck-rail
shipping under scrutiny. BNSF Railway and J.B. Hunt Transport
Services Inc., its main trucking partner, are headed to arbitration
over how to split the revenue the companies generate from moving
shipping containers and trailers. WSJ Logistics Report's Jennifer
Smith writes the partnership is important to both companies'
fortunes, funneling large numbers of containers into their
transportation networks and accounting for around $2 billion in
revenue for J.B. Hunt. The impasse comes as intermodal rates paid
by shippers are falling even as the railroad's share of the revenue
appears to be growing. The companies are fighting over a shrinking
intermodal pie: the Association of American Railroads says U.S.
intermodal volume fell 1.6% last year despite a sharp surge at the
end of the year.
The sales operation at Tesla Motors Inc. is moving faster than
the auto maker's supply chain . The Silicon Valley business
reported record high orders in the fourth quarter, with sales up
27% over the same period a year ago. But the WSJ's Tim Higgins
reports Tesla couldn't make and ship the vehicles fast enough to
head off delays after introducing new hardware to the Autopilot
semiautonomous driving feature in the vehicles. That suggests Tesla
is still struggling to get its parts delivery, production and
distribution bulked up to meet ambitions that included delivering
80,000 vehicles last year. Tesla fell several thousand cars short
in part because of last-minute delays transporting vehicles it had
sold. The big auto makers deliver far more cars than Tesla, of
course, and the company may look for ways to match their supply
chains as its own ambitions grow.
U.S. companies that have been holding their cash on the
sidelines are preparing to invest again, and that could mean a new
rush of goods heading into depleted domestic supply chains.
Executives expecting regulatory rollbacks, corporate tax breaks and
increased infrastructure spending from Washington have grown more
optimistic about growth, the WSJ's Theo Francis and Vipal Monga
report, and rising interest rates are unlikely to impede them.
German steel company Klöckner & Co., which generates about 40%
of its sales from its 50 U.S. sites, expects to increase spending
on steel-shaping machinery in the coming year, for instance, after
holding back investment amid slowing demand from industrial
customers that make railcars and oil storage tanks. Although the
Federal Reserve appears poised to raise interest rates, which would
make borrowing more costly, many companies say they won't be
deterred by higher expenses if the promise of strong returns
remains.
E-COMMERCE
The world's biggest container shipping line is stepping into the
e-commerce waters. Maersk Line, the shipping unit of A.P.
Moeller-Maersk A/S, and Alibaba Group Holding Ltd. struck a deal
that will allow the Chinese online sales giant to book space on
Maersk vessels for its customers. Reuters reports Alibaba started
offering the booking late last month under the OneTouch service
that targets small and medium-sized Chinese exporters with online
services such as customs clearance and logistics. Other technology
startups have launched services to bypass the traditional
third-party shipping services of freight forwarders. And Amazon.com
Inc. is already in the freight forwarding business. But Alibaba's
entry gives such efforts another high-profile standard bearer and
will give Maersk -- and the carrier's competitors -- a chance to
see how retail e-commerce capabilities fit into the purely
industrial shipping business.
QUOTABLE
IN OTHER NEWS
Warehouse operator Global Logistic Properties Ltd. is seeking
buyers . (WSJ)
Auto makers rolled out stronger-than-expected December U.S.
sales, leaving the industry on track to set an annual record in
2016. (WSJ)
Eurozone consumer prices rose at the fastest annual rate in more
than three years in December. (WSJ)
Macy's Inc. outlined restructuring plans that will eliminate
some 10,000 jobs and shut about 63 department stores this spring.
(WSJ)
Kohl's Corp. slashed its guidance for 2016 as the retailer said
fourth-quarter sales were worse than expected. (WSJ)
Apple Inc. plans to invest $1 billion in SoftBank Group Corp.'s
new technology fund to help finance technologies it could use in
the future. (WSJ)
The Mexican peso hit a record low against the dollar a day after
Ford Motor Co. canceled plans to build a new plant in San Luis
Potosi. (MarketWatch)
Senate Democratic Leader Charles Schumer says a Republican plan
for private tax credits for infrastructure won't "get the job done"
to finance projects. (The Hill)
Union Pacific Corp. acquired the refrigerated distribution
assets of Railex LLC. (American Shipper)
China Cosco Shipping Corp. Ltd. will acquire a 10% stake in
Shanghai Rural Commercial Bank for $660 million. (MarineLink)
Germany's government approved a controversial proposal to allow
longer trucks, dubbed "gigaliners," on highways. (Deutsche
Welle)
Diesel prices in the U.S. reached their highest point since
August 2015 to start the year. (Commercial Carrier Journal)
New Jersey based trucking and logistics operator NFI bought
Canadian freight services firm Dominion Warehousing &
Distribution. (Philadelphia Inquirer)
Warehouse leasing rates in central Pennsylvania are rising
despite record capacity expansion, according to CBRE Group Inc.
(Central Penn Business Journal)
A Chinese autonomous-driving startup says it will test use of
its technology for truck "platooning" operations by October. (Heavy
Duty Trucking)
Tank Holding Corp. bought the material handling division of
Canada's Agri Plastics. (Plastics News)
Daimler AG's Mercedes-Benz Vans unit is displaying a modified
cargo van aimed at hosting last-mile delivery drones.
(Trucks.com)
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 05, 2017 07:00 ET (12:00 GMT)
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