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Logistics Intelligence Brief
Monday, September 20, 2021


LTLs become selective about freight as demand booms

Transport Dive Jim Stinson September 17, 2021

LTLs are picking the freight that can deliver the most profit, said Cathy Morrow Roberson, president of Logistics Trends and Insights. But Roberson warned that the high end of the cycle doesn't last, and customers who are turned down will remember.
Shippers are now learning to go beyond the big LTL firms and consider other options, Roberson said.
"Sit down with your LTL provider and come up with a solution," said Roberson. "There are options, and shippers need to be aware of these options."
One option could be 3PLs, Roberson said.

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Big Lots plans ‘bypass network’ to mitigate port congestion during peak season

Supply Chain Dive Edwin Lopez September 17, 2021

Big Lots is setting up a "pop-up" DC bypass network in Q3 and Q4 to help process its holiday imports and ship them direct to store, CEO Bruce Thorn said during the company's Q2 earnings call.
The network consists of "a handful of DCs [near] our DCs" that will help expedite any inventory that "lingers," Thorn said. "For example, 98% of our Christmas trees come out of a Yantian port, so you want to make sure that it's prioritized in time."
The bypass network is part of Big Lots' plan to prioritize holiday shipments in a volatile freight environment. Big Lots expects the environment will normalize in 2022. But at the moment, lead times are long, lasting four to eight weeks, Thorn said.

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Rising transportation and supply chain costs are driving industrial real estate leasing activity

Logistics Management Jeff Berman September 17, 2021

Should this level of leasing activity continue, CBRE said that 2021 would top 2020, the current record, at 713.3 million SF. What’s more, it noted that robust demand, coupled with a 4.0% national vacancy rate, have led to average rents climbing 9.7%, going back to August 2020.
The firm explained that significantly higher transportation costs, which are rising faster than rental rates, are serving as a driver for the uptick in leasing activity. This has been seen in the form of what it called robust demand for goods, as well as ongoing delays at ports, which have led to increases of more than 230% to ship a single 40-foot container from “CBRE Supply Chain Advisory reports that transportation costs typically account for half of an occupier’s total logistics spend but can easily rise to 70%, while fixed facility costs (including real estate) account for only 3% to 6%,” said CBRE.
And as supply chain costs have increase, CBRE said that occupiers are keen on outsourcing distribution and warehousing services, with 3PLs leading the pack, having nearly doubled their year-to-date leasing volume through July, to 121 million SF of bulk industrial space, for a 31.3% market share.
Rounding out the top three are: General Retail & Merchandise, at 96 million SF (24.8% market share), and E-commerce, at 52 million SF, (13.8% market share).

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AAR reports annual U.S. rail carload and intermodal declines, for the week ending September 11

Logistics Management September 17, 2021

Intermodal containers and trailers—at 244,900—slipped 6% annually, trailing the week ending September 4, at 266,212, and the week ending August 28, at 269,756.
Through the first 36 weeks of 2021, U.S. rail carloads—at 8,293,870—are up 8.2% annually, and intermodal units—at 9,994,693—are up 11.5%, for the same period.

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FedEx adding 90,000 workers to handle peak surge

Freight Waves Todd Maiden September 17, 2021

FedEx Corp. said Thursday it would hire 90,000 workers “ahead of busy peak season.”
The company will host in-person National Hiring Day events in Memphis, Tennessee, Indianapolis, Dallas and Atlanta next Thursday. FedEx (NYSE: FDX) will look to add package handlers, managers, technicians, forklift drivers, couriers and customs trade coordinators through virtual events as well.
“These positions are critical to the company’s success in meeting rising e-commerce demands from retailers and consumers,” the press release said.
The plan includes temporary bonus structures and pay bumps in certain areas.

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Labor-management cooperation blooms from COVID-19 chaos: terminals

The Journal Of Commerce Bill Mongelluzzo September 17, 2021


“No one wants to see disruptions,” Sal Ferrigno, vice president of SSA Marine in Long Beach, told the Intermodal Association of North America Expo this week, also in Long Beach. The Pacific Maritime Association (PMA), which represents employers, and the ILWU are expected to begin negotiations next spring, with the coastwide contract set to expire on July 1, 2022.
Employers and the International Longshoremen’s Association (ILA) at East and Gulf Coast ports are not under such a tight deadline, as their contract expires in the fall of 2024. Their focus right now is on keeping their ports fluid while longshoremen and terminal staff contend with uncertain working conditions amid the COVID-19 pandemic.
In New York-New Jersey, dockworkers have continued to report to their jobs every day even though 450 longshoremen have tested positive for coronavirus disease 2019 (COVID-19) since late last year, with seven dockworkers dying, said Jon Poelma, managing director of APM Terminals.
“I am super proud of them. It’s been boots on the ground,” Poelma said.

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What the Infrastructure Bill Would Help Fix First

The Wall Street Journal Scott Calvert September 19, 2021


If the infrastructure bill passes, drivers should see some ramp-up next year but probably won’t notice major changes until 2023 because of the time required for design work and other early steps, said Alison Premo Black, senior vice president at the American Road and Transportation Builders Association.
“You’re going to see projects that either weren’t going to get done, or weren’t going to get done for another five or six years, that might get done in the next two years,” said Jim Tymon, executive director of the American Association of State Highway and Transportation Officials.
Typically, federal funds provide about half of what states pay for highway and bridge projects, though there is a wide range among states. The bill would generally raise funding by about 30%, with states able to compete for more.

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Truckload Carriers warns of vaccine mandate’s ‘far-reaching implications’

Freight Waves John Kingston September 17, 2021

A second leading trucking trade organization has come out with a statement that doesn’t outright say it opposes the proposed Biden administration’s vaccine mandate but comes very close to it.
Like the earlier statement released by the American Trucking Associations, the Truckload Carriers Association, in a letter signed by its chairman, does not take a firm stand declaring that the mandate to vaccinate workers at companies with more than 100 employees is a bad idea. But the statement does say that the mandate “could have wide-reaching implications for our industry and the nation as a whole.”
One specific area of concern mentioned in the statement signed by TCA Chairman Jim Ward, whose day job is president of Maryland-based D.H. Bowman, is the difficulty in vaccinating a workforce of drivers who at any given time are all over the country. That would also extend to testing the unvaccinated, which a company would need to do for that subset of employees. Several other industry officials have described this as a key challenge.
“Obviously, the logistics of vaccinating an army of professional truck drivers operating in an irregular operating environment remains a strong concern,” Ward said in his note.
But the bigger concern is the mandate leading to drivers leaving the industry. “A larger fear is that a rule requiring a vaccine or weekly test could lead to a massive driver exodus from this great industry,” Ward wrote. “Already faced with a shrinking pool of drivers from COVID-19 itself, we are all confronted with the pervasive challenge of locating qualified drivers to deliver our nation’s freight safely, effectively and efficiently.”
The ATA statement did not make mention of a large loss of drivers. Rather, it raised another concern that others in the industry have expressed: that the hard cutoff at 100 employees will create a two-tiered system of companies that are required to vaccinate or test and others that won’t.

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Distracted Driving Coalition Launches Nationwide Effort

Transport Topics Eric Miller September 17, 2021

The coalition will focus on such areas as distracted driving data collection, technologies, education, enforcement and legislation.
“Every few hours a life is lost on the nation’s highways due to distracted driving,” said National Transportation Safety Board Vice Chairman Bruce Landsberg. “In no other mode of transportation would we accept the kind of carnage that we have on our highways.”
NTSB is among the steering committee members of the coalition.
Others on the steering committee include American Trucking Associations, the Insurance Institute for Highway Safety, Governors Highway Safety Association, National Sheriff’s Association, Federal Motor Carrier Safety Administration and National Highway Traffic Safety Administration.

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Outrider’s Robotic Yard Trucks Are Taking On Dangerous, Dirty Jobs

Bloomberg Ira Boudway September 18, 2021

Yard trucks: also known as spotters, shifters, shunt trucks, and terminal tractors, or, for those who prefer zoological nomenclature, yard birds, horses, dogs, or mules. By any name, they are the vehicles that tow semi-trailers from dock to dock and parking spot to spot at warehouses and shipping yards. Last week, I tried my hand operating one. I’m proud to report that, on my first try, I successfully backed a 53-foot trailer into a dock sandwiched by two other trailers.
Well, more precisely, I sat at a laptop at my dining room table in suburban New Jersey, clicked a few simple commands and then watched online as a yard truck at a warehouse in Brighton, Colorado, drove to a parked trailer, hitched to it, towed it about 150 feet to an empty dock, backed in, and unhitched — all without human intervention.
“We identified that autonomous vehicles in a private property, low speed application like a distribution center could have a huge impact,” says Outrider CEO Andrew Smith, who founded the company in 2017 and ran it in stealth under the name Azevtec until last year. There are, Smith estimates, about 50,000 yard trucks in operation in the U.S. at any given moment.

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