Supply Chain by the Numbers

- Jan. 18, 2018 -

  Supply Chain by the Numbers for Week of Jan. 18, 2018

Chamber of Commerce Calls for Big Hike in Fuel Taxes; Amazon Culls the List of HQ2 City Candidates; UPS, FedEx Delivered this Holiday Season; Big Savings in Global Shipping from Blockchain, Maersk and IBM, Say


25 Cents

That is the increase in the current federal tax on gasoline and diesel fuels that the US Chamber of Commerce called for this week. That is more than double the current level of just under 19 cents for gas and 23 cents for diesel, even as mileage levels for cars and trucks have improved substantially since then, reducing taxes collected for each mile driven. Neither of those current tax levels has been changed since 1993. The goal of course is to raise money to invest in US highways and bridges. To get there, the Chamber is recommending an increases in the taxes of 5 cents for 5 years, but said it would welcome a proposal that increased the tax all at once. Chamber president Tom Donohue – a former president of the American Trucking Associations - said such an increase on fuel taxes could raise as much as $375 billion for infrastructure work over the next 10 years. The business group is also calling for a more efficient permitting process to reduce the cost of infrastructure projects, as well as increased private partnerships to fund infrastructure projects. Will it fly? "Well, nobody's for a gas tax, except the American people," Donohue said.



That is the percent of global transportation costs that are related to administration, substantially driven by the paper-work intensive processes usually involved. That according to Maersk Line this week, which announced it has formalize a joint venture with IBM to provide a digital platform for global trade using blockchain technology, continuing a more informal collaboration between the two companies that began last year. The new company – yet to be named – will be headquartered in the New York City area and run by Michael White, formerly the head of Maersk' North American shipping business. The new company will make money from fees participants – including shippers, ocean carriers, freight forwarders and more – will pay to participate in various blockchains. IBM also hopes to sell services to help companies leverage all the blockchain data. Maersk is looking to move beyond shipping containers to become more of a total logistics business for ocean cargo.



That's the number of cities on the new short list Amazon released this week of metro areas still in the running as the location for's second US headquarters. The new HQ is expected to bring eventually some 50,000 jobs to the winning metropolis, with an Amazon investment of maybe $5 billion to build its new campus. Those 20 cities have been winnowed down in a few months since 238 regions submitted proposals for the project last fall. The new list is heavy on cities in the Midwest and East Coast, and does not include many locations west of the Mississippi. Those 20 are: Atlanta; Austin; Boston; Chicago; Columbus; Dallas; Denver; Indianapolis; Los Angeles; Miami; Montgomery County, Md.; Nashville, Tenn.; Newark, N.J.; New York City; Northern Virginia; Philadelphia; Pittsburgh; Raleigh; Toronto; and Washington, D.C. It will get interesting from here, with a decision supposedly coming not too far into 2018.



That was the on-time delivery rate for UPS in the holiday shipping week ending Dec. 23rd, while FedEx's success rates was an also strong 98.7% for the same period. That according to data analysis announced this week by parcel tracking firm ShipMatrix. That's pretty good performance, and means nearly all packages made it under the tree by Christmas day, despite the double digit growth in parcel volumes. That delivery success is also a far cry from the delivery disaster of 2014, when millions of packages weren't delivered until after Christmas. UPS had some issues early in this just finished season, with the huge volumes overwhelming its capacity in the week following Black Friday. However, UPS got back on top of the issue by extending the workweek for some employees, redeploying office workers to help load trucks or deliver packages, and increasing the use of contract employees using golf carts to deliver packages in some neighborhoods to supplement its trucks.