FedEX-ellent AI-vestment 💸
Good morning! As the sun continues to blaze and the end of July approaches, we're excited to bring you the latest edition of The WorkDay Dash. Just like the scorching temperatures, the industry is heating up with groundbreaking developments and innovative solutions.
From heat-resistant technologies to strategic cold chain management, get ready to beat the heat and stay ahead of the curve in the world of logistics. ☀️🕶
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FedEx has recently invested in the AI platform Vue.ai, with the exact amount undisclosed, as stated in a news release on July 11. Vue.ai aims to enhance supply chains with intelligent technology and position itself as the leading AI platform for large enterprises, enabling them to create comprehensive vertically integrated systems tailored to their respective industries. Owned by California-based Mad Street Den, Vue.ai offers a range of applications that leverage AI and automation, primarily catering to businesses in the retail sector and beyond. The platform's focus on optimizing data utilization and employing AI-based decision-making for personalized user interactions promises to bring significant benefits to its users.
The investment aligns with FedEx's commitment to advancing smart logistics for a global customer base. Kami Viswanathan, FedEx Express senior vice president of Middle East, Indian Subcontinent, and Africa operations, highlighted the significance of this collaboration in achieving technological innovation that benefits customers worldwide. This strategic investment was made through FedEx Innovation Lab, which supports early-stage funding for startups in India, fostering FedEx's digital capabilities and creating a valuable network of partnerships. FedEx's exploration of AI in supply chains has also been evident through its longstanding collaboration with Microsoft, focused on harnessing data and AI to optimize delivery efficiency and operations.
Check out today’s featured article from Supply Chain Dive to read more about why FedEx invested in an artificial intelligence platform called Vue.ai. Will this platform launch FedEx into a smarter supply chain? How will this affect jobs in the future?
Featured Article:
FedEx invests in artificial intelligence platform Vue.ai | Supply Chain Dive
“The collaboration aims to create smarter supply chains by increasing the use of AI among large enterprises.”
Air Travel & Cargo
LAX Airport Selects Developer for Groundbreaking Cargo Transformation Project
Los Angeles International Airport (LAX) has chosen a consortium led by Realterm, the largest manager of on-airport air cargo real estate in North America, to undertake a revolutionary cargo improvement project. This ambitious endeavor aims to transform outdated cargo facilities throughout the vast airport complex into a state-of-the-art cargo village, optimizing capacity and efficiency. As the largest traditional international gateway in the United States and the second-largest cargo airport (excluding major parcel hubs), LAX's cargo upgrade is crucial to remain competitive and accommodate future growth.
The selected consortium, known as LAX Community Partners, plans to construct a cutting-edge two-story facility covering 1.6 million square feet, equipped with advanced material handling technology to enhance cargo throughput. The project includes a truck staging lot and off-site cargo support facilities to streamline trucking operations securely. Automatic license plate readers and artificial intelligence will be utilized to track processing times, ensuring more efficient operations. This transformational initiative is the first of its kind in cargo history and promises to set a precedent for future air cargo facilities. Although the specific cost is yet to be disclosed, the project is expected to span several years, with environmental review starting in the third quarter of 2024 and construction lasting into the next decade.
Shipping & Customer Relations
Unwavering Shipper Loyalty Remains Amidst Looming UPS Strike Threats
Despite the looming threat of a UPS strike, many companies have not shifted their package volumes to other carriers. The national contract between UPS and the International Brotherhood of Teamsters, representing around 330,000 UPS employees, is set to expire, and the union plans to strike on August 1 if a new contract isn't reached. However, some shippers have chosen to maintain their current volume levels with UPS due to a variety of factors. Larger-scale clients may be confident that a deal will be reached before a strike occurs and may be concerned about losing volume-based shipping discounts and the complexities of adjusting their carrier mix. Additionally, strict contract language and financial penalties for diverting volume to other carriers have deterred some shippers from making a switch.
On the other hand, some shippers, particularly small- and medium-sized businesses, have already taken steps to mitigate potential disruptions from a UPS strike. These companies have diversified their carrier mixes beyond UPS since the capacity constraints experienced during the COVID-19 pandemic. Many have secured capacity at alternative carriers and developed contingency plans to minimize the impact of a potential work stoppage. While some shippers are holding steady with UPS, others are actively implementing alternative carriers to safeguard their operations in the face of the impending strike threat.
Let’s Get Global 🌎
Checking out the scoop outside of the United States…
🚢 Port Houston is Anchoring its Future in Houston's Historic Fifth Ward. Port Houston is embarking on a transformative journey by relocating its administrative office to the vibrant East River mixed-use development in Houston's historic Fifth Ward. This strategic move reflects the port's commitment to its roots and emphasizes its crucial role in fostering the growth and prosperity of the surrounding community. The new headquarters, nestled near Allen's Landing, where Houston's commercial center was envisioned in 1836, will honor the city's trade heritage along Buffalo Bayou and the Houston Ship Channel, which now supports over 1.35 million Texas jobs.
📱The Geopolitical Climate on the Microchip Supply Chain is Turbulent. The microchip industry plays a pivotal role in various key sectors of the global economy, from computing and telecommunications to military and healthcare. However, the COVID-19 pandemic revealed the industry's vulnerability to supply chain disruptions, leading to a severe chip shortage that persists to this day. Geopolitical tensions, particularly between the United States and China, have further exacerbated the situation, with trade disputes and export controls impacting microchip production and trade. The ongoing trade dispute between the US and China has led to the imposition of tariffs and restrictions on certain Chinese tech companies, affecting the flow of critical components and technology needed for microchip production.
iLevel With You 🏡
More topics for the average American household to consider…
🚛 Industry Bodies Clash Over Costs and Effectiveness of Truck Underride Guards. The U.S. National Highway Traffic Safety Administration's (NHTSA) proposal for side underride guards on newly built large trucks has led to opposing views from prominent industry bodies. The Insurance Institute for Highway Safety (IIHS) supports the mandate, claiming that it could save ten times more lives than initially projected by the NHTSA. Conversely, the Owner-Operator Independent Drivers Association (OOIDA) opposes the rule, citing concerns about cost, practicality, and safety issues raised by small-business truckers. Underride guards are installed beneath the sides of truck trailers to prevent smaller vehicles from sliding underneath during accidents. The IIHS argues that the NHTSA's estimates did not consider various types of relevant crashes, leading them to predict that the mandate could prevent up to 217 deaths annually, far more than the NHTSA's projection of 17 fatalities prevented each year.
🇺🇸 The US has not gone through a recession. According to a recent report by ISS ESG, a full-blown recession has not occurred, but there has been a lackluster performance in a low-growth environment, coupled with high inflation, interest rates, and tighter liquidity due to a recent banking crisis. Despite these challenges, the technology sector has shown some outperformance. ISS ESG's proprietary data and research team, consisting of experts with capital markets experience and sectoral expertise, reevaluated their analysis six months later to provide actionable intelligence and support for investors. The report aims to help investors assess and prioritize complex ESG (Environmental, Social, and Governance) risks and investment opportunities in this evolving economic landscape.
📦 Prime Day Insights: Unraveling the Supply Chain Implications for Peak 2023. The results of Amazon Prime Day on July 11-12 indicate that Peak 2023 is likely to be a strong and busy season for the supply chain. Despite initial concerns about consumer spending in an uncertain economy with higher interest rates, Prime Day saw an increase of 10 percent in shoppers, reaching an estimated 150 million. Electronics were among the most popular purchases, suggesting a positive trend for holiday spending. Supply management organizations should evaluate the impact of Prime Day and use the data to assess their supply chains' operations and resources, as well as those of their partners. Planning in advance for a surge in demand and addressing staffing needs is crucial, considering Prime Day created around 100,000 temporary jobs in the U.S.
Get Smart 🧠
Ramp up that brain power for these advanced topics…
🔥 The Impact of Wildfires on Logistics and the Supply Chain. Wildfires have significant effects on logistics, disrupting supply chains, transportation networks, and overall business operations. They can cause transportation disruptions with road closures and restricted access, leading to delays and increased costs. Supply chains can be interrupted, affecting production and distribution. Companies in wildfire-prone areas face inventory management challenges to protect their stock from fire damage. Air quality issues can lead to flight cancellations and labor shortages, while labor disruptions arise due to evacuations and hazardous conditions. Insurance costs may increase, and market demand and prices can be influenced by the severity of wildfires. Proactive planning and collaboration are crucial to building a resilient logistics system to navigate these impacts effectively.
⛽️ Average US Diesel Prices Rise in Tandem with Climbing Oil Prices. Average U.S. diesel prices have increased to $3.905 per gallon from $3.806 per gallon as of July 24, with all regions experiencing price hikes. The Gulf Coast saw the highest increase from $3.506 to $3.640 per gallon. California has the highest average price at $4.944 per gallon. The rise in diesel prices is attributed to climbing oil prices, with Brent futures and U.S. West Texas Intermediate crude both edging higher for the third consecutive session due to signs of tighter supplies and Chinese authorities' pledges to support their economy.
🚛 Leasing is a Pathway for Fleets Interested in Electric Vehicles. Leasing companies are offering fleets a pathway to enter the electric vehicle (EV) space and adopt new technologies without the need to invest in their own trucks. Leasing arrangements help fleets navigate the changing landscape of emissions rules and the shift towards electric and alternative vehicles. Companies like Penske Truck Leasing, Fleet Advantage, and Ryder provide consultation on charging, regulations, and grant funding, as well as handle maintenance and repairs. Leasing partners also offer flexibility for fleets to adopt new technologies as the trucking industry undergoes significant changes, particularly with the rise of electric vehicles. Additionally, leasing companies help fleets with predictive maintenance, cost analysis, and integration of telematics to improve operational efficiency and safety.
The Workday Dash is an aggregation of articles regarding the transportation logistics, trucking, and supply chain industries for November 27, 2024, from iLevel Logistics Inc.