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  First Thoughts

    Dan Gilmore

    Editor

    Supply Chain Digest



 
July 8, 2022

Top Supply Chain Stories by Month 1H 2023

 

It was Again an Eventful Six Months, to Say the Least



It was truly a crazy year first half year in supply chain - with war in Europe, soaring inflation driven in part by sky high gas an
d diesel prices, still more COVID shutdowns in China  and more.

Here, my choices for the top or most interesting chain stories by month in the first half of the 2021. Here we go:

Gilmore Says....

There were many other important stories so far this year - what did I leave out?

What do you say?

Click here to send us your comments
 

January

Among the oddest stories thus far in 2022, there is widespread reporting that brazen thieves are opening intermodal containers as freight trains slow down or stop as they approach depots in downtown LA. That also leaves a trash mess around the rails from items the thieves don't want.

 

The queue of shipps waiting to unload at the ports of Los Angeles and Long Beach reaches a record high of 105, even as peak season has ended weeks before.

 

News that Walmart is expanding its item-level RFID mandate to home goods, announced in a letter to its vendors. Walmart said it has been implementing item-level RFID tags on apparel over the past year and now is expanding that to home goods. That includes including kitchen and dining products, home decor, bath and shower, bedding, furniture, and storage and organization products. The memo also suggests more categories will have similar tagging mandates in the future.

 

February

 

Russia invades Ukraine late in the month, expecting rapid victory and welcoming crowds, only to find fierce resistance and military set backs. The war has a big impact, sending oil and natural gas prices higher as well as causing rising food and cooking oil prices as well.

 

4000 automobiles are destroyed as a cargo ship catches fire not far off the coast of Portugal on its way from Germany to the US, including Porsches, Volkswagens, Lamborghinis, Bentleys and Audis. The value of those cars is estimated at $334.5 million by consulting firm Anderson Economic Group. The fire started in the hold and spread quickly, forcing the crew of 22 to abandon the ship via helicopter. A number of electric cars were on the ship, leading to speculation a lithium ion battery on car started the fire, or that it started from some other cause and the batteries accelerated the spread. The ship sinks when being towed to a port.

 

TuSimple announces its driverless truck technology has made seven totally automouss between Phoenix and Tuscon in recent weeks. It added that these trips were taken under various road conditions, including dense early-evening traffic and back-to-back runs on the same night. The tests also did not use teleoperation or traffic intervention along the way. The bigger news is that based on the success of these tests, rail carrier Union Pacific will use TuSimple equipped trucks to move freight between Tucson and Phoenix starting later in 2022, the company's first customer for autonomous trucking services.

March

Reports that apparel maket Untuckit has 177,0000 items that were supposed to arrive via ocean container by the end of December but that still hadn’t arrived by the beginning of March. When the winter garb does show up, the company plans to pack it away for next year – absorbing lost sales this year of about $15 million, as global shipping woes continue on.

 

Amazon wins a second vote on unionization at a fulfillment center in Bessemmer, Alabama, with workers once again rejecting the Retail, Wholesale & Department Store Union - albeit by a smaller margin. This after a National Labor Relations Board official ordered a redo after Amazon won the first vote in 2021, citing alleged illegal behavior by Amazon leading up to the first vote.

 

However, Amazon FC workers on Staten Island won a bid to form a labor union after federal officials tallied votes at an FC there. If a union is ultimately formed, it will become the first and only Amazon FC to unionize anyere in the country. However, Amazon prevails in vote at an a sortation center in the same campus area, where workers  in early May voted down organizing with the same make-shift union that won the first vote.

 

News that 3PL company Performance Team will soon add 300 heavy duty electric trucks to its North America network. The e-trucks will come from Swedish company Einride. The trucks will be delivered between 2023 and 2025, and the order comes after Performance Team was acquired by ocean shipping giant Maersk Line in 2020. Maersk says this is the largest announced plan for electric truck deployment to date in the US.

April

Walmart announces that some first year truck drivers for its private fleet are now able to earn as much $110,000 per year, up from $87,000 before. Walmart also says a first year drivers can enjoy as many as 21 paid vacation days in 12 months. Other elements of Walmart’s program includes improved schedules that give drivers more time at home.

 

8000 luxury cars sitting at Belgium’s Port of Zeebrugge are stranded because they were headed to Russia. The cars, which include the latest Lexus, Cadillac and Mercedes models, arrived from Asia in early April. But now the vehicles come under a ban against luxury goods exports to Russia as part of the sanctions stemming from the Ukraine invasion. In fact, there is a whole range of products stuck at Zeebrugge because of sanctions.

May

 

At its Q1 earnings call, Amazon says it now has too many logistics workers, after two years of torrid hiring. Amazon now says that it hired too quickly in its fulfillment centers during the pandemic, and now has a surplus of workers, a situation that wlll not take too long to address through attrition. A short time later, Amazon also says it has too much FC space too, with reports it is subletting space in some markets and also delaying opening some FCs.

Gartner releases its top 25 supply chains list for 2022. This year Cisco Systems comes out on top for the third year in a row - sort of. I put it that way because again in 2021, Apple, Procter & Gamble, Amazon, McDonald's and Unilever were left off the formal top 25, as those five companies have been placed in a separate relatively category called "supply chain masters," a sort of supply chain hall of fame. The rest of the top 10 after Cisco were was (2) Schneider Electric; (3) Colgate-Palmolive; (4) Johnson & Johnson; (5) PepsiCo; (6) Pfizer (7) Intel; (8) Nestle; (9) Lenova; and (10 - surprisingly) Microsoft.

 

Talks begin on a new contract between the International Longshore and Warehouse Union (ILWU), which represents about 24,000 dock workers, and the Pacific Maritime Association, which represents 29 ports and terminals on the West Coast. The current contact then expires on June 30 with a deal nowhere in sight, with port automation said to be a major issue. The stevedores keep working without a contract - for now.

 

Ecommerce store front software vendor Shopify announces it has acquired software firm Deliverr for $2.1 billion in cash and stock, enabling what Shopify founder and CEO Tobi Lütke says will be an “end-to-end logistics” platform for millions of merchants. Deliverr offers software that predicts the demand for each product by market based on a number of variables. Shopify had previously announced it was building out a fulfilment network for its web merchant customers that would rival Fulfilled by Amazon.

June

Walmart says it will be expanding its “DroneUp” delivery network to 34 sites by the end of the year, with a reach across six states and up to 4 million households. The program, which focuses on Arizona, Arkansas, Florida, Texas, Utah, and Virginia, will provide the ability to deliver up to 1 million packages by drone per year.

 

CSCMP and Kearney release the 2022 State of Logistics report. The headline news: what the report several years back started calling US Business Logistics Costs (USBLC) rose sharply on an absolute basis in 2021 to $1.85 trillion. That was an increase of 22.4% from an economically weak 2020. With a smaller increase in US nominal GDP (10%) than logistics cost rose last year (22.4%), that took the relative cost of logistics as a share of GDP to 8.0%, up significantly from 7.44% in 2020.

 

So there you go. There were many other important stories so far this year - what did I leave out?


Any  other top supply chain stories in the first half of 2022?  Let us know your thoughts at the Feedback section below.

Your Comments/Feedback

 
 
 
 
 
 
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