Supply Chain by the Numbers

- Dec. 14, 2017 -

  Supply Chain by the Numbers for Week of Dec. 14, 2017

Foxconn Plans for Autonomous Vehicles at Wisconsin Mega-Plant; Impact of ELD Mandate Monday Unknown; Orders for Tesla Semi Keep Rolling In; New DC Woes at Mattel add to Its Woes



That’s about how many employees per shift that contract manufacturing giant Foxconn plans to move using autonomous vehicles from parking lots to their jobs at a flat screen panel factory under development in southern Wisconsin. And that is not all Foxconn is planning in terms of driverless technology. The Taiwan-based company, which is constructing a $10 billion manufacturing plant in the state, has told Wisconsin officials that it wants roads with technological innovations, including those that can ferry workers and cargo in autonomous vehicles to its facilities east of I-94 south of Milwaukee. Wisconsin officials previously acknowledged Foxconn’s interest in seeing such lanes on I-94 for driverless vehicles to move parts and components between Milwaukee’s Mitchell International Airport and the factory. What’s more, the state Department of Transportation recently said in documents that it is "strongly committed" to making upgrades on key roads by 2021 to accommodate self-driving vehicles near the plant. On the employee side, the plan is that workers at the plant would park their cars in lots west of I-94, and then be driven in an autonomous vehicles of some kind to Foxconn’s campus 1-2 miles away.


That is the general range of the effective hit to US truckload productivity that will come with the mandate beginning Monday Dec. 18 that all drivers use so-called electronic logging devices (ELDs) to track compliance with hours of service (HOS) rules. But no one really knows for sure – some say the impact will be higher, especially on specific lanes. The loss of capacity will come from carriers and drivers ing no longer able to fundge the paper-based logs that have been in use since the 1930s, as well as some carriers/drivers simply leaving the business rather than comply. The issue is almost entirely around smaller and some mid-sized carriers and independent drivers – most large carriers been using ELDs for years – but in total that group represents a significant amount of total US capacity. The change comes as the US freight market is increasingly tight in a growing economy and continued driver shortages, and should serve to push rates higher – just how much so is the question.



That is how many of the coming Tesla Semi electric trucks being pre-ordered for promised 2019 delivery - we’ll see - by food giant PepsICo placed this week, as interest in the unproven vehicles remains high. That brings total pre-orders to some 285 of the trucks, which will come in two model types, as previously shippers and carriers such as Walmart, UPS, Meijer, JB Hunt, Sysco and others announced they had ordered Tesla Semis – though the PepsiCo order is by far the largest to date. PepsiCo intends to deploy the Teslas for movement of snack foods and beverages between manufacturing and distribution facilities and direct to retailers, all within the 500-mile range promised by Tesla Chief Executive Elon Musk for the larger battery model when the trucks were unveiled two weeks ago. Pepsi has a goal of reducing greenhouse gas emissions across its supply chain by a total of at least 20% by 2030 – and the company wants to see if electric trucks can be part of that plan. Other truck makers are also busy: Navistar International and Volkswagen are partnering to launch an electric medium duty truck by late 2019, while rival Daimler has delivered the first of a smaller range of electric trucks to customers in New York.



That is how many toys Mattel expected to ship annually out of a new 1 million square foot distribution center opened this summer in Jonestown, Pennsylvania. That was the company’s first East Coast DC, adding a third facility to existing Los Angeles and Dallas facilities. Apparently, it isn’t happening. The company has faced a series of woes, including the bankruptcy filing by major customer Toys R Us in October, which costs Mattel some $43 million on lost receivables. Now, there are unspecified problems with the operation of the new DC. Reports say the facility, being managed by 3PL Ryder, has been having startup issues since opening this summer. As a result of a failure to meet throughput projections, Mattel has been forced to ship goods for East Coast customers from LA and Dallas, adding to logistics costs versus expectations. With the chaos, Mattel rival Hasbro is moving to take over the company, which would leave just one major US toymaker still standing in the face of dramatic changes in the market in recent years.