Supply Chain by the Numbers for Week of August 12, 2011
LTL Carriers try to Right Pricing Ship; Need a Job? Burlington Northern Hiring; WalMart Sets Next Wave RFID Deadline; CSX Pouring it Back In
Announced increase in base freight rates this week by FedEx Freight, the company's LTL unit. This joined similar moves by other LTL carriers announcing rate increases above 6.0%. While most shippers are under contracted rates and thus not imminently affected by the move, and certainly would negotiate smaller increases at contract time, the beleaguered LTL was able to push rates northward in Q2, and perhaps will exert some discipline to move rates still higher and return to some level of profitability.
Number of new workers added so far in 2011 by railroad carrier Burlington Northern, with similar headcount increases seen by most of the other major lines as well, as business and profits continue to be good for US rail service providers. All four major US public carriers (Burlington Northern is now part of Warren Buffet's Berkshire Hathaway company) saw revenue growth in the mid to high teen percentages in Q2, with strong profit growth as well.
In other rail news, the amount of its revenues rail carrier CSX said in its recent Q2 earnings call that it was going to invest in its network from now through 2015. Capital investments in 2011, for example, will total some $2.2 billion. These are incredible investment levels for an industry that a decade ago had among the worst returns on invested capital of any industry in the US.