Railroads continue to push for single-person crews despite Ohio derailment outrage
Good morning! It's Tuesday, the most productive day of the week (we hope), and we're back with another edition of our daily newsletter. Let's get this logistics party started! 🎉
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One of the most prominent battles fought on the regulatory playing field by railroads has been the desire to have only one crew member required in the cab of their locomotives. A bipartisan bill has been introduced in Congress in the light of the Ohio train derailment that has taken the nation by storm - and one of the main sticking points? A legal prohibition on single-person crews - despite existing agreements with labor unions.
Check out today’s featured article from CNN to read about the back-and-forth between Congress and the nation’s railroads over rail safety legislation. After the Norfolk Southern train derailment, will the railroads prevail at resetting crew requirements to one instead of a two-person minimum?
Featured Article:
Despite toxic disaster, railroads still want single-person crews | CNN
“The nation’s major freight railroads have long desired to have only one crew member, a lone engineer, in the cab of their locomotives. And that desire hasn’t changed despite the derailment of a Norfolk Southern train on February 3 that released toxic chemicals into the air, water and soil of East Palestine, Ohio, that is still being cleaned up.”
Safety & Railroads 🚂
Second Norfolk Southern train derails in Ohio, four weeks after East Palestine toxic spill
Norfolk Southern Corp. isn’t having the best month. A second train derailment has been reported in the state of Ohio only four weeks after a train carrying toxic chemicals derailed and resulted in suspicious environmental and health issues for nearby East Palestine and its residents. This second train derailment was just outside the city of Springfield, and there are still many unresolved questions. DOT Secretary Pete Butigieg has confirmed the derailment of about thirty cars and no recorded injuries. While there have not been any reports of chemical spillage, it has been stated that the second train derailment was hauling chemicals - and the story is still unraveling.
Ohio has a rich history of railroads, which played a significant role in the state's development and economic growth. Today, Ohio is still an important hub for freight rail traffic, with several major railroads operating in the state. These railroads operate thousands of miles of track throughout the state, serving industries such as manufacturing, agriculture, and energy.
Shipping & Demand Issues 🚢
Global ocean carriers are weathering staggering increases in vessel capacity
Container lines have historically been able to withstand increases in vessel capacity, but a massive increase in capacity could potentially pose challenges for the industry. Container lines have typically responded to increases in vessel capacity by adjusting their supply-demand balance through strategies such as idling vessels or reducing sailings to prevent oversupply and maintain freight rates. However, a massive increase in capacity could result in a prolonged oversupply situation, leading to downward pressure on freight rates and profitability.
In addition, a significant increase in vessel capacity could also put pressure on ports and other parts of the supply chain, as they may not be able to handle the increased volume of cargo. This could lead to congestion, delays, and increased costs for container lines. Furthermore, a large increase in vessel capacity could also lead to consolidation in the industry, as smaller or less efficient container lines may struggle to compete with larger players with greater economies of scale.
Let’s Get Global 🌎
🇪🇬 Traffic in Egypt’s Suez Canal eased after broken-down container ship is moved. Four tugboats worked hard over the weekend to move the MSC INSTANBUL from being stranded in the middle of the canal, allowing traffic to flow through the vital waterway once again. The ship, flying under the Liberian flag, was on its way from Malaysia to Portugal when broke down. The incident sparked fears of a similar situation to the 2021 Ever Given becoming jammed in the southern section of the canal, blocking shipping traffic for nearly a full week. The situation caused massive delays worldwide for the supply chain - but luckily, it seems this incident was resolved in short order.
🦾 Chinese e-commerce giant JD.com brings new tech to California warehouses. Dubbed “self-operating warehouses”, the logistics service provider is expanding its technology to North America with the goal of optimizing inventory and storage for retailers. The tech involves automation from the point where trucks deliver goods to the warehouse to when forklifts transfer those goods to corresponding trucks for delivery to their final destinations. Currently, JD.com operates over 1,500 warehouses in China alone and covers approximately 9.7 million square feet of space. JD.com cites the growing holding costs for companies due to B2B and B2C growth of demand for why the tech is expanding to the United States west coast.
♻️ Greener shipping is the future: here’s what to expect. The shipping industry is exploring alternative fuels such as hydrogen, biofuels, and ammonia as a way to reduce greenhouse gas emissions. The adoption of these fuels is likely to increase in the coming years as the technology becomes more advanced and cost-effective. Shipping companies are investing in new technologies such as automation, artificial intelligence, and data analytics to optimize their operations and reduce their environmental impact. For example, smart shipping systems can help vessels operate more efficiently, reducing fuel consumption and emissions. Collaboration between shipping companies, ports, and other stakeholders is essential to achieving greener shipping.
🔋 A purchasing consortium may be underway for critical electric battery resources in the US. By pooling their purchasing power, companies can negotiate better prices for critical resources used in electric batteries. This can help reduce the cost of electric vehicles and make them more affordable for consumers. The US relies heavily on imports for critical resources used in electric batteries, such as lithium, cobalt, and nickel. A purchasing consortium can help ensure a secure and reliable supply of these resources, which is critical for the development of a domestic electric vehicle industry. Overall, a purchasing consortium for critical resources for electric batteries can help support the growth of the electric vehicle industry in the US by reducing costs, ensuring a secure supply of critical resources, and promoting environmental responsibility.
iLevel With You 🏡
More topics for the average American household to consider…
🛣️ Southern traffic spurs growing support for pay-to-use express lanes. While trucks will not be eligible for these lanes under the proposal of Governor Bill Lee (TN-R), advocates are claiming that the lanes will be of benefit to everyone, including those who are on the main stretch of freeway. The South has a strong tradition of individualism and a preference for limited government intervention in people’s lives. This ethos may make Southerners more skeptical of pay-to-use express lanes, which may be seen as a government imposition on their freedom to use the roads they have already paid for through taxes. Additionally, the South has a high poverty rate. which means that many people may not have the financial means to pay for express lanes. Some critics have begun referring to the lanes as “the Lexus lanes.”
❄️ Electric buses struggle to get through a rough Chicago winter. The Chicago Transit Authority is adjusting the strategy of operating electric buses throughtout the city, especially during the year’s coldest months. Bus drivers need to constantly monitor the electric buses’ battery, noting that if if falls below a 50% charge, it should then be topped off at a charger. This is due to the severe cold effecting the battery range - on average, cutting off 100 miles on a bus with a 282-mile expected range. The Chicago Transit Authority is looking to continue to cut emissions and combat climate change, but also expand its electric charging capabilities. An “on-route” charging station is in the works to help combat this issue.
🎤 DOT Secreate Pete Buttigieg fire back at critics: “East coast elite”. Republican criticism has been rampant over Buttigieg’s response to the East Palestine train derailment, with senators like Mitt Romney (R-OH) and and Marco Rubio (R-FL) calling for his resignation. Buttigieg responded in an interview with CNN, labeling his critics as “lifelong card-carrying members of the East Coast elite” who “wouldn’t know their way around a T.J. Maxx if their life depended on it.” Buttigieg also referred to Ohio as “the forgotten middle of the country” and voiced his intention to hold railroads responsible for loosen rail safety regulations.
✈️ Fear flying? Fear not: there’s a solution for that. According to studies, a fear of flying affects nearly 40% of the American population - and 5% of that group refuse to get in an airplane. The fear of flying, also known as aviophobia, can be a challenging and distressing condition for those who experience it. Fortunately, there are several strategies that can help individuals overcome their fear of flying. Gradual exposure to the experience of flying can help desensitize an individual to their fear. This can involve starting with watching planes take off and land, then progressing to short flights and gradually increasing the duration of the flights.
Get Smart 🧠
Ramp up that brain power for these advanced topics…
🗣️ DHL Global Forwarding CEO focuses on merger and acquisition strategies. M&A activity can help freight forwarding companies expand their market share by acquiring smaller competitors or merging with other players in the industry. Additionally, M&A can also help freight forwarders diversify their service offerings, expand into new geographic markets, or enter new industry verticals. By merging with or acquiring other companies, freight forwarders can often achieve cost savings through synergies and economies of scale. This can result in a more efficient and profitable business model.
🤑 Trucking fleets are doing all they can to survive inflation. One of the most direct ways to offset inflationary pressures is to increase prices for shipping services. This can be done by negotiating higher rates with customers or by implementing surcharges to cover increased costs. Fuel is a major expense for trucking fleets, and rising fuel costs can have a significant impact on profitability. To manage fuel costs, trucking companies can use fuel-efficient vehicles, optimize their routes to reduce mileage, and take advantage of fuel discounts and rebates. Improving operational efficiency can help truck fleets reduce costs and improve profitability
🥫 Connected supply chain keep food goin’ around. Connected supply chains enable food manufacturers to have real-time visibility into their entire supply chain, from farm to table. This allows them to track and trace products at every stage of the journey, helping to ensure food safety and quality. By connecting suppliers, manufacturers, distributors, and retailers, supply chain processes can be optimized for increased efficiency. This can help reduce costs, minimize waste, and improve customer satisfaction. Connected supply chains facilitate collaboration between all stakeholders in the supply chain, enabling better communication and coordination.
♻️ Navigating ESC compliance is a complex subject. Navigating ESG (Environmental, Social, and Governance) complexity in the supply chain can be a challenge for companies. Companies should set clear ESG goals and priorities for their supply chain, and communicate these goals to their suppliers. This can help ensure that suppliers are aligned with the company's values and can help track progress towards ESG goals. Regular audits of suppliers can help identify potential ESG risks and help ensure compliance with relevant regulations and standards.
🚢 Walmart, Target, and Home Depot identified as “most responsible” for global emissions via ships. These are three of the largest retailers in the United States - each having extensive supply chains that involve shipping products from factories and warehouses to retail locations across the country. These retailers have vast networks of suppliers, manufacturers, and transportation providers that contribute to their overall carbon footprint. In particular, the carbon emissions associated with shipping are a significant contributor to their overall emissions, given the large volumes of goods that they transport.
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.