Big win for ride sharing apps: Proposition 22 upheld in CA appeals court
Good morning! Happy National Consumer Rights Day! As we find ourselves midweek in the month of March, there's no better time to reflect on the impact of supply chain management on consumer satisfaction and protection. So grab your coffee and let's dive into today's newsletter.
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Uber and Lyft are celebrating a big win in the California appeals court after upholding voter-approved Proposition 22. Proposition 22 is a California ballot measure that was approved by voters in November 2020, exempting app-based ride-hail and delivery companies, such as Uber, Lyft, DoorDash, Instacart, and Postmates, from a state law that would have required them to classify their drivers as employees rather than independent contractors. Supporters of Proposition 22 argued that it allows drivers to maintain the flexibility to work as much or as little as they want, while also preserving the affordability and accessibility of these services for consumers. Opponents, including labor groups and some drivers, argued that it undermines worker rights and job security, and allows companies to avoid paying for basic benefits and protections like minimum wage, overtime pay, and unemployment insurance.
Check out today’s featured article from AP News to read about the upholding of California’s Proposition 22 and what it could mean for independent contractors throughout the state, across various industries.
Featured Article:
California court rules for Uber, Lyft in ride-hailing case | AP News
“App-based ride hailing and delivery companies like Uber and Lyft can continue to treat their California drivers as independent contractors, a state appeals court ruled Monday, allowing the tech giants to bypass other state laws requiring worker protections and benefits.”
Artificial Intelligence & Supply Chain Safety 🤖
Supply chain risk is out there, but Microsoft’s latest software Dynamics 365 Copilot can help
Microsoft’s Dynamics 365 Copilot software unveiled new artificial intelligence capabilities last week that is meant to assist shippers in flagging potential disruptions before they occur. In a wider push by Microsoft to offer AI-powered assistance to businesses, the software can analyze potential risks - including weather - and provide insight to the user.
Microsoft has potential to revolutionize the way supply chain management is done. AI-powered predictive software can help companies optimize their supply chain operations by analyzing vast amounts of data, identifying patterns, and predicting future demand and supply chain risks. With the help of AI-predictive software, companies can make better and faster decisions related to inventory management, production planning, logistics, and distribution. This can lead to increased efficiency, reduced costs, and improved customer satisfaction. For example, AI-predictive software can help companies anticipate disruptions in the supply chain and take proactive measures to mitigate them, ensuring that products are delivered on time and in the right quantity. AI-predictive software can also help companies become more sustainable by reducing waste and minimizing the environmental impact of their supply chain operations. By analyzing data from suppliers, manufacturers, and distributors, companies can identify opportunities to reduce their carbon footprint and make their supply chains more environmentally friendly.
Driver Issues & Money Matters 💰
Trucker pay is historically strong despite sluggish momentum
The upward momentum for truck driver pay has been slowing in recent years, but it is still historically strong due to several factors. With the trucking industry still facing a shortage of qualified drivers, there has been massive upward pressure on driver pay. However, as the labor market conditions improve and more drivers enter the industry, the upward momentum for pay may continue to slow down. The trucking industry is also notably sensitive to economic conditions, and during times of economic growth, demand for trucking services tends to increase, which can lead to higher driver pay. Due to lingering worries of economic contraction or recession, demand for trucking services may decline, which can put additional downward pressure on driver pay.
Overall, the upward momentum for truck driver pay has been slowing in recent years, but it is still historically strong due to the ongoing driver shortage and industry dynamics. However, there are several factors that could limit the ability of carriers to continue raising driver pay, including labor market conditions, economic conditions, industry competition, and cost pressures.
Let’s Get Global 🌎
🌎 CEOs need to step up to protect global supply chains from growing risks. By moving out of a reactive mode and proactively addressing supply chain resilience, CEOs can identify and mitigate risks before they become major disruptions. This can help to minimize the impact of disruptions and maintain business continuity. Proactive supply chain management can also help to reduce costs associated with disruptions, such as increased transportation costs or inventory carrying costs. By investing in supply chain resilience, CEOs can save costs in the long run. Companies with resilient supply chains are better positioned to respond to changing market conditions and customer demands and this can lead to a competitive advantage over companies with less resilient supply chains.
💰 German automotive giant Volkswagen unveils $193 billion investment plan for EVs. Meant to be spread out over five years, the plan to invest nearly $200 billion in the electrification transition comes on the heels of a 13% increase in operating profit year-over-year. Delivery numbers declined 7% due to “supply chain and logistics issues”, but Volkswagen seems to be banking on its electrification and digitalization plans. CEO Oliver Blume highlighted the company’s ambitious targets and strong financial position as a reason to keep up with the rapidly evolving energy and economic market.
🚢 Shipping lines are holding onto capacity despite ongoing price war. This action is likely due to capacity cuts having significant long-term consequences for their business. When shipping lines cut capacity, it means they are reducing the number of ships they have in operation or reducing the amount of cargo they can carry. While this may temporarily reduce supply and increase freight rates, it can also have negative consequences. Firstly, cutting capacity can lead to the loss of economies of scale. Shipping lines invest significant capital in their vessels, and reducing the number of ships in operation can lead to decreased efficiency and higher costs. Secondly, cutting capacity can also result in the loss of market share. If a shipping line reduces capacity, its competitors may be able to capture a larger share of the market, which can be difficult to regain once the market recovers.
🇩🇪 Sennder, Amazon’s European delivery partner, is racing to “uber-ize” freight. Sennder is a Berlin-based digital freight forwarder and logistics company that partners with Amazon to provide delivery services in Europe. Sennder uses technology to connect shippers with carriers and optimize the logistics process, with the goal of making freight transportation more efficient, transparent, and sustainable. Sennder's technology platform enables Amazon to quickly and efficiently match shipments with carriers, manage delivery routes, and track the movement of goods in real time, allowing for greater visibility and control over the entire logistics process.
🇨🇳 China’s global chip combination will weaken as South Korea pivots toward Japan & US. South Korea is aligning with the United States and Japan, which could lead to greater cooperation and coordination among these countries in the development and production of advanced semiconductor technologies. South Korea is a major player in the global chip industry, and its close alignment with Japan and the US could give these countries a competitive advantage over China. South Korea and Japan are home to some of the world's largest semiconductor manufacturers, including Samsung and SK Hynix in South Korea and Toshiba and Renesas Electronics in Japan. These companies play a critical role in the global chip supply chain, and any disruption to their operations could have a significant impact on the availability and pricing of semiconductors worldwide.
iLevel With You 🏡
More topics for the average American household to consider…
💸 The Fed - and inflation - just won’t quit. The elevated inflation rate has remained steadfast and stubborn, despite a multitude of efforts by the central bank to stifle it over the past year. Prices increased 0.4% in February 2022, easing 0.1% compared to January’s growth… but continuing, nonetheless. With Americans’ anxiety spiking after two large banks shuttered their doors within hours of one another due to a bank run, the Federal Reserve may be refocusing on bolstering financial system confidence instead of raising the interest rates again… for now. Chair Jerome Powell is signaling for help from a Senate committee to raise the benchmark interest point by a half-point.
🍫 CPG giant Nestlé is investing in sustainable packaging transformation. Over the past few years, Nestlé has undertaken a transformation to sustainable packaging to reduce its environmental footprint and help address the global plastic waste problem. One of Nestlé's key goals is to make 100% of its packaging recyclable or reusable by 2025. To achieve this, the company has been redesigning its packaging to make it more environmentally friendly. For example, Nestlé has reduced the amount of plastic it uses in its packaging, by introducing new packaging designs that use less material. It has also replaced non-recyclable plastics with recyclable alternatives, such as bioplastics made from plant-based materials.
♻️ Customers wants sustainable deliveries, but residential areas pose a challenge. Residential delivery has become increasingly popular in recent years, driven by the growth of e-commerce and online shopping. However, it involves more frequent and smaller deliveries compared to commercial deliveries, which can result in increased emissions from delivery vehicles. Residential deliveries also often result in excessive packaging waste, as each item is often packaged individually to protect it during shipping. The increase in residential deliveries can also lead to increased congestion in urban areas, as delivery vehicles navigate through busy streets and neighborhoods.
😅 Lowe’s delivery driver is caught on TikTok flubbing appliance delivery. If you’ve ever been home all day waiting for a delivery, you know the frustration of seeing a note on your door that evening saying that the company “tried, but delivery window was missed by the customer.” TikTok user Michelle (@michellegwynn85) caught a Lowe’s delivery driver on camera honking the horn, running to the door, sticking a “missed delivery” note to the door, and departing - without ever knocking or ringing the doorbell. The now-viral video has customers seething - and Lowe’s PR team likely in a tizzy.
Get Smart 🧠
Ramp up that brain power for these advanced topics…
📦 Deliverr gets a leg-up with Shopify praise. Shopify’s integration of the e-commerce fulfillment and order storage provider Deliverr is being utilized to expand its capabilities cost-effectively while rivaling Amazon. The “asset-light” network of warehouse partners, carriers, and last-mile providers is critical for Shopify’s operations, says CFO Jeff Hoffmeister. At Morgan Stanley’s Technology, Media, and Telecom Conference last week, Hoffmeister boosted Deliverr’s abilities and its leading nature in the elastic warehouse capacity space.
🤖 Supply chain tech investments aren’t panning out as executives expected. Consulting company PwC conducted a survey with 305 executives and concluded that a mere 17% say that technology implementations have delivered on expectations. Alternatively, that means that 83% are disappointed with results of recent supply chain tech investments. Supply chain tech investments often involve integrating new technologies and systems with existing ones. This can be a complex and time-consuming process, and if not done properly, it can lead to operational inefficiencies and other problems.
🙋♀️ WIT announces 6th annual list of Top Women to Watch in Transportation. Women In Trucking Association’s (WIT) editorial staff selects individuals for its list to promote gender diversity in the industry and highlight career accomplishments over the past 12-18 months. WIT is a nonprofit organization that was founded in 2007 to encourage the employment of women in the trucking industry, promote their accomplishments, and address any obstacles they may face. It provides networking and career development opportunities for women in trucking, and advocates for policies and initiatives that support the recruitment, retention, and advancement of women in the industry.
😷 A domestic PPR supply chain can thrive with a few simple steps. One of the keys to building a resilient PPE supply chain is to diversify suppliers - work with multiple suppliers, both domestic and international, to ensure that the supply chain is not reliant on a single source. This can help to mitigate the risk of supply chain disruptions and ensure a more reliable supply of PPE. Another way to build a domestic PPE supply chain is to increase domestic production. This can be achieved through partnerships with domestic manufacturers or by investing in new production facilities. By increasing domestic production, companies can reduce their reliance on international suppliers and ensure a more reliable supply of PPE.
🚂 Availability of the fuel needed for the alternative powertrain is critical. Fleet managers should ensure that the fuel is readily available and can be easily accessed by their vehicles, either through a local fueling station or on-site refueling infrastructure. Additionally, the total cost of ownership for the alternative powertrain should be compared to that of the traditional internal combustion engine. The total cost of ownership includes the upfront cost of the powertrain, ongoing maintenance costs, fuel costs, and any incentives or tax credits available. Fleet managers should consider the range and payload capacity of the alternative powertrain.
✈️ A220 delivery delays are being addressed by Airbus. The A220 is a narrow-body commercial aircraft that was formerly known as the Bombardier CSeries before Airbus acquired a majority stake in the program in 2018. One of the major supply chain issues that has affected A220 deliveries is a shortage of engines. The aircraft is powered by Pratt & Whitney's PW1500G geared turbofan engines, which have experienced production delays due to technical issues and increased demand from other aircraft programs. To address this issue, Airbus has been working closely with Pratt & Whitney to increase engine production and improve the reliability of the engines. By working closely with its suppliers, increasing production rates, and diversifying its supply chain, Airbus aims to improve the reliability and efficiency of its A220 program and deliver aircraft to customers on time.
The Workday Dash is an aggregation of articles regarding the transportation logistics, trucking, and supply chain industries for November 28, 2024, from iLevel Logistics Inc.