🚛 Flexport Drives Expansion
Good morning! Welcome to the November 3rd edition of "The Workday Dash," your go-to source for the latest updates, trends, and insights in the dynamic world of supply chain and logistics. As we embark on the first Friday of November, our newsletter is packed with valuable information to help you navigate the ever-evolving challenges and opportunities in the industry.
So, grab your coffee, and let's dive into today’s edition to stay ahead in the fast-paced world of supply chain management! ☕️👍
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Flexport Expands Logistics Reach with Acquisition of Convoy's Technology Stack
Flexport is set to acquire Convoy's technology stack, signaling its entry into the trucking services sector and reinforcing its end-to-end logistics capabilities. With access to Convoy's network of over 400,000 truck drivers and 80,000 carriers, Flexport aims to provide customers with comprehensive trucking services. The acquired technology includes advanced procurement tools for automating load bookings, potentially reducing carrier costs. However, Flexport plans to pursue a different strategy compared to Convoy, focusing on offering integrated logistics services rather than competing for the largest accounts.
Check out today’s featured article from Supply Chain Dive to learn more about why Flexport bought Convoys tech and what they plan on doing with it. Will Flexport expand with this information and technology?
Featured Article:
Flexport buys Convoy’s tech stack, plans to relaunch truckload service | Supply Chain Dive
“Flexport acquired Convoy’s tech stack for an undisclosed sum, according to a Wednesday blog post, and plans to restore the company’s shuttered full truckload offering in the coming weeks.”
Toyota & UAW
Toyota Raises U.S. Assembly Line Worker Wages Amid Industry Trends
Toyota is set to increase the top wage for most assembly line workers in the U.S. by 9.2% to $34.80 per hour starting from January 1. This decision comes after the United Auto Workers union secured significant pay raises for hourly workers at U.S. plants owned by General Motors, Ford, and Stellantis. Unlike the Detroit car manufacturers, Toyota's U.S. plants are not unionized, but the UAW has ambitions to extend its influence beyond the Detroit three by 2028. Toyota currently operates nine vehicle assembly and auto parts plants across eight states in the U.S. and is also in the process of constructing a new battery production facility in North Carolina.
This wage increase by Toyota reflects a broader trend of automakers enhancing compensation packages for their hourly workers, driven in part by labor shortages and increased competition for skilled labor in the automotive industry.
Uber & Freight
Uber Freight CEO Highlights Turning Point in Freight Industry Amid Fuel Price Surge
The freight transport sector has been facing significant challenges, including bankruptcies and reduced demand due to low freight rates. Uber Freight's CEO, Lior Ron, suggests that the freight recession may be reaching a critical turning point, primarily due to rising fuel prices. Uber Freight has observed an increasing number of carriers relinquishing shipping lanes after submitting bids, which could indicate that carriers are struggling to cover the costs of certain routes, particularly as fuel costs surge.
Despite being in the fourth quarter, both shipper volumes and carrier rates remain depressed. Carriers are becoming more discerning about the volume of loads they accept in bids to maintain profitability, while shippers are carefully selecting carriers they view as stable and capable of providing reliable service. These trends highlight the ongoing challenges in the freight industry, with fuel costs serving as a critical factor influencing carrier operations and profitability.
Let’s Get Global 🌎
Checking out the scoop outside of the United States…
📉 Europe's Economic Slowdown Leads to Piling Empty Containers. Logistics depots in Europe are dealing with a surplus of empty shipping containers due to the Euro Zone's economic crisis, resulting in decreased trade and container movement. This problem is worsened by the high repositioning costs, making it financially unattractive for container lessors to return them to Asia, with disruptions from COVID-19 and Russia's war in Ukraine further impacting EU trade with key partners. However, conditions are anticipated to improve in 2024 if geopolitical tensions do not escalate.
💧 Panama Canal Records Driest October Since 1950. The Panama Canal is grappling with an unprecedented drought caused by the El Niño phenomenon, resulting in the driest October in 73 years. This has led to a 41% reduction in water levels in Gatun Lake, affecting water supply to over 50% of the population and posing challenges for canal operations in the upcoming dry season. To address this, the canal has implemented reservation slots to maintain draft levels and conserve freshwater resources while monitoring climate patterns closely.
iLevel With You 🏡
More topics for the average American household to consider…
🚂 Railroad Automatic Braking System Needs Enhancement to Prevent Further Derailments. The National Transportation Safety Board (NTSB) has called for enhancements to the railroad automatic braking system, specifically urging the Federal Railroad Administration and the industry to continue developing new technology for Positive Train Control (PTC) systems. This recommendation follows a review of the current PTC system's limitations and the need for ongoing improvements despite significant investments to implement the system mandated by Congress in 2008.
📈 Federal Reserve Maintains Benchmark Interest Rate at 5.4%. The Federal Reserve has decided to maintain its key short-term interest rate at 5.4% for the second consecutive meeting but indicated the potential for further rate hikes if inflationary pressures persist. While market turbulence has pushed longer-term interest rates to near 16-year highs, Federal Reserve Chair Jerome Powell expressed confidence that inflation is gradually decreasing and the economy continues to grow, although he acknowledged the potential impact of sustained elevated longer-term interest rates on economic growth.
👎 Murky Economy Prompts Manufacturers to Reduce Staff and Lower Expectations. The Federal Reserve has maintained the key short-term interest rate at approximately 5.4% for a second consecutive time, marking the highest level in 22 years. Despite earlier rate hikes in 2022, the Fed has paused its aggressive approach, having raised rates only once since May. The Fed's statement acknowledged the recent market turbulence, which has driven longer-term interest rates to nearly 16-year highs and increased borrowing costs across the economy, potentially affecting economic activity.
Get Smart 🧠
Ramp up that brain power for these advanced topics…
⛽️ Congressional Hearing Underscores the Urgency of Replacing the Gas Tax. The House Transportation and Infrastructure Committee's Highway and Transit Subcommittee held a hearing on the federal Highway Trust Fund's (HTF) status and future, emphasizing the need for a sustainable solution to its long-term solvency. Witnesses, including Chad Shirley from the Congressional Budget Office (CBO), highlighted the urgency of addressing the HTF's projected insolvency by 2028, with a focus on reinvigorating the users-pay/users-benefit principle through alternatives like mileage-based user fees (MBUFs) to replace fuel taxes.
🛤 US Class I Railroad Operations Report Mixed Employee Numbers. The average number of employees in U.S.-based operations of Class I railroads remained stable or declined in 2023 compared to 2020, with only the train and engine (T&E) and executives, officials, and staff assistants categories experiencing growth. On average, these railroads employed 121,649 individuals from January to September 2023, slightly down from 121,819 during the same period in 2020. The T&E category saw an 8.5% increase due to concerns about service quality, while other categories like maintenance, structures, and non-T&E transportation employees saw reductions in headcount. The executives and officials category grew by 7.9%, reflecting ongoing changes in the rail industry.
🚛 First of Daimler’s New Medium-Duty EV Trucks Arrive in the U.S. Daimler Truck's new medium-duty electric Rizon trucks have arrived in the U.S., with the initial 50 units available for fleet purchases through Velocity EV. These trucks qualify for California's zero-emission incentives and feature smaller batteries compatible with consumer-grade AC chargers, offering a 160-mile range ideal for shorter regional routes and urban deliveries.
The Workday Dash is an aggregation of articles regarding the transportation logistics, trucking, and supply chain industries for November 22, 2024, from iLevel Logistics Inc.