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Supply Chain by the Numbers

- July 7, 2016 -

  Supply Chain by the Numbers for Week of July 7, 2016

Record Toll for Passage Through New Panama Canal; Rolling Delivery Bots to Start Working in Four Euro Cities; Yet Another Major Materials Handling Sector Acquition; US Deficit in Goods with China Soars



That is what a Chinese container ship paid to pass through the expanded and newly opened Panama Canal a week ago, setting a record for the passage. The expansion of course is to allow much larger ships – up to 14,000 TEU from a 5000 TEU limit previously – to traverse the Canal connecting the Atlantic and Pacific oceans, offering a new route especially to US East Coast ports from Asia instead of going around Africa's Cape of Good Hope, using the Suez Canal, or moving goods by train from West Coast ports. We guess the economics work out, but that charge for the 11-hour journey through the locks is substantial. The first ship to go through the new Canal, from carrier COSCO Shipping Panama, paid a not inconsiderable $575,545, briefly holding the toll record. So with some quick math, if there were 7000 40-foot containers on that record setting ship, that amounts to a toll charge of $118 per container – maybe not so bad after all.




That's the number of European cities (London, Düsseldorf, Bern, and Hamburg) in which delivery robots from a company called Starship Technologies will start operating sometime this month. The Starship delivery bots will be stationed at select restaurants, delivery hubs, and supermarkets. When an order comes in, the bots will drive themselves to collect their cargo, store it in their holds (which can take about two shopping bags' worth of stuff), then roll on to their destinations. When the robot arrives, the recipient unlocks it by punching in a security code on a mobile app. The goal of course for Starship and its partners is to shave time and costs from "last-mile" logistics. Starship estimates that it currently costs up to £12 to have a package delivered on-demand in central London. Its plan is to get that number down to £1 per delivery.

$29 Billion

That was the US trade deficit in goods with China for May, as reported this week by the US Census Bureau, up 20% from April levels and the highest total yet in 2015. That puts the trade deficit in goods with China at $131.2 billion for the year, and means breaking the annual record yet again in 2016 is now possibility. That record deficit of $367 billion was set in 2015, which broke the 2014 record, etc., but with lower deficits early in the year it seemed the 2016 total would be lower. That is still a strong possibility, but with the May gap a new record is again potentially in the cards. The overall trade deficit in both goods and services jumped 10% in May, to $41.1 billion, driven by a big jump in imports. We keep waiting for the US reshoring wave to show up in the numbers.


$1.5 Billion

That's what industrial giant Honeywell is paying to acquire Intelligrated, in the second major deal in the US materials handling sector in a week. Just a few days before, German fork truck maker Kion announced it was acquiring Intelligrated rival Dematic. Honeywell is said to have outbid Toyota Industries, the world's largest lift truck maker and Kion competitor, to acquire Intelligrated. The move by Honeywell, known primarily for widespread businesses in the automotive, aerospace, and controls sectors, was a bit surprising, though it has been in the supply chain business for years through acquisitions of data collection equipment providers Handheld Products, Intermec, and LXE. Good times and fast growth in the materials handling sector, driven by investments in omnichannel fulfillment, are behind the moves. Intelligrated is estimated to achieve $900 million in revenue in 2016.

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