Los Angeles Port-boom 💥
Good morning! As we observe the National Day of Peace, we are reminded of the profound impact that peace and stability have on supply chain and logistics operations worldwide. In an interconnected global economy, peace is not merely an aspiration but a fundamental prerequisite for the smooth flow of goods, the security of transportation networks, and the prosperity of nations.
Join us in commemorating this day and recognizing the vital connection between peace and the logistics that drive our world forward. ☮️✌🏼
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Port of Los Angeles Sees Remarkable 3% Year-Over-Year Cargo Volume Surge in August Amidst Renewed Confidence
Cargo volumes at the Port of Los Angeles experienced a noteworthy 3% year-over-year surge in August, totaling 828,016 TEUs (Twenty-Foot Equivalent Units). This upturn represents the first increase in 13 months and comes as a result of the recent ratification of a 6-year contract between the International Longshore and Warehouse Union and the Pacific Maritime Association. Port of Los Angeles Executive Director Gene Seroka attributes this growth to the newfound stability and renewed customer confidence in selecting the Port of Los Angeles as their cargo destination. Despite this positive development, overall demand remains somewhat subdued, as shippers grapple with persistently high levels of excess inventory, as evidenced by the Federal Reserve's inventory sales ratio of 1.40, indicating 40% more inventory than what is sold.
Seroka emphasized the significance of the 6-year contract, which extends through 2028, assuring customers of reliable services from longshore workers and terminal operators. He expressed the port's readiness and efficiency, asserting that when they are operating at peak performance, there is no better choice for cargo than the Port of Los Angeles. However, the lingering challenges of elevated warehouse inventories across the United States continue to influence the market, tempering the extent of cargo volume growth.
Check out today’s featured article from Supply Chain Dive to learn about why the Port of Los Angeles is seeing a 3% increase for the first time in 13 months. Will there be a snowball effect that leads to more of an increase?
Featured Article
Port of Los Angeles sees the first volume increase in 13 months | Supply Chain Dive
“Container volumes at the port were up 3% YoY in August.”
USPS & Peak Season
U.S. Postal Service Ends Holiday Surcharges for Competitive Edge
The U.S. Postal Service has announced that it will not impose peak season surcharges during the upcoming holiday season. This marks the end of a practice that was initiated in 2020. Officials attributed this decision to more workers transitioning into long-term career positions and investments in the postal network, which have helped reduce holiday operating expenses and eliminate the need for peak surcharges. Postmaster General and CEO Louis DeJoy stated, "We are ready to handle any peak season volume in a superior and routine manner. That is why we will not be adding any additional surcharges for our customers during this peak period. We will continue to be the most affordable way to mail and ship during the holiday season."
This move comes as the Postal Service aims to improve its financial health and compete with other parcel carriers as part of its 10-year transformation plan. While FedEx and UPS will still impose peak season surcharges starting in October, the Postal Service's decision is seen as a competitive advantage, attracting shippers looking for cost-effective and reliable holiday shipping options. The Postal Service has increased its processing capacity, added sorting machines, and is hiring 10,000 seasonal employees to accommodate the anticipated surge in holiday activity, aiming to ensure on-time delivery reliability.
Labor & Amazon
Amazon Plans to Hire 250,000 Logistics Workers for Holiday Season Amid Retail Hiring Decline
Amazon.com Inc. is planning to hire 250,000 logistics workers for the upcoming holiday season. This move is significant as overall holiday hiring in the retail sector is expected to be the lowest since 2008. The recruited workers will include full-time, part-time, and seasonal employees, with hourly wages ranging from $17 to $28, depending on the location. Amazon will also offer bonuses ranging from $1,000 to $3,000 to some new hires and boost the average pay for logistics personnel to about $20.50 per hour in an effort to attract and retain workers amid the ongoing labor shortage.
While many retailers are not significantly increasing their holiday hiring due to changing consumer behavior and the rise of e-commerce, Amazon continues to expand its workforce as it benefits from the shift to online shopping. U.S. e-commerce sales are projected to surge by 9.3% this year to reach $1.14 trillion, outpacing overall retail spending growth. This hiring announcement underscores Amazon's confidence in its holiday season prospects and its ongoing need for a large and flexible workforce to meet customer demand.
Let’s Get Global 🌎
Checking out the scoop outside of the United States…
🇩🇪 Germany's New Car Registrations Soar in August, with Plug-in Electric Vehicles Leading the Charge. In August, new passenger car registrations in Germany increased by 37% year-over-year to 273,417, with a total of 1,913,564 new cars registered in the first eight months of 2023, up 16.5% year-over-year. Plug-in electric car sales had a particularly strong month, reaching the highest level of the year so far. Total new plug-in electric car registrations for August amounted to 101,201, a 78% year-over-year increase, making up 37.0% of the total volume compared to 28.5% a year ago. This surge was primarily driven by battery electric cars (BEVs), which saw a nearly 171% year-over-year increase to 86,649 registrations, accounting for about 31.7% of the total market, up from 16.1% the previous year. In contrast, plug-in hybrid car (PHEV) registrations decreased year-over-year for the eighth consecutive month due to the absence of generous incentives this year.
🇹🇼 Bed Bath & Beyond Files $7.7 Million Complaint Against Yang Ming for Alleged Pandemic Exploitation. Bed Bath & Beyond (BBB) has filed a complaint with the Federal Maritime Commission (FMC) accusing Taiwan-based container line Yang Ming of unfairly exploiting its customers during the COVID-19 pandemic. The complaint seeks at least $7.7 million in damages. BBB alleges that Yang Ming systematically failed to meet its service commitments in order to take advantage of higher shipping rates, resulting in increased freight costs and inflation for shippers and the broader public in the U.S. BBB claims that Yang Ming violated the Shipping Act of 1984 by failing to allocate space as agreed upon and instead allocating space to shippers willing to pay higher freight prices. The complaint also alleges an unreasonable assessment of demurrage and detention charges during periods of congestion and shortages of equipment at ports.
☀️ U.K. Prime Minister Delays Emissions-Reduction Targets, Including Gasoline and Diesel Car Ban. U.K. Prime Minister Rishi Sunak has announced a delay in several key emissions-reduction targets, including pushing back the ban on the sale of new gasoline and diesel cars from 2030 to 2035. Sunak argued that households needed more time to transition away from gas boilers to heat pumps and that some households would receive exemptions from these targets. He framed these changes as being in the interests of households, suggesting that Westminster should not impose significant costs on working people, especially those already struggling financially. However, these changes have faced criticism, particularly from the automotive industry and environmental organizations. Ford UK, for example, argued that the 2030 target was crucial for accelerating the shift to electric vehicles and that a relaxation of this target could undermine their efforts.
iLevel With You 🏡
More topics for the average American household to consider…
💨 Ocean Infinity to Conduct Cutting-Edge Survey for Equinor's California Offshore Wind Farm Project. Ocean Infinity, an ocean robotics firm, has entered into a contract with Equinor Wind US LLC to conduct a comprehensive site investigation survey off the coast of Morro Bay, California. The survey will be carried out using multiple Autonomous Underwater Vehicles (AUVs) and will support Equinor in developing its floating offshore wind farm project on the U.S. West Coast. Ocean Infinity operates the world's largest fleet of advanced deepwater autonomous vessels, making this survey a significant advancement in the U.S. renewable energy sector. The survey will include various offshore assessments to inform Equinor's Site Assessment Plan (SAP) and Construction and Operations Plan (COP). The work is scheduled to begin in February 2024.
🛤 California's San Joaquin Valley to Port of Los Angeles Rail Service Set for 2028 Launch. A rail service connecting California's San Joaquin Valley to the Port of Los Angeles is expected to commence operations in 2028. This project, supported by the Port of Los Angeles and the State of California's investment of nearly $50 million, aims to create an inland port at the former Castle Air Force Base site in Merced County. The initiative will coincide with the opening of the Atwater Merced Expressway and is expected to benefit agricultural exporters in the Central Valley by providing a regular rail service to San Pedro Bay. The project will utilize rail connections from BNSF Railway and Union Pacific, enhancing transportation options for Central Valley shippers seeking access to international markets.
Get Smart 🧠
Ramp up that brain power for these advanced topics…
🚛 California Debates Self-Driving Truck Restrictions Amidst Safety and Job Concerns. California lawmakers, labor unions, and truck drivers are urging Governor Gavin Newsom to sign a bill that would ban self-driving trucks weighing more than 10,000 pounds from operating on public roads without a human driver on board. Proponents of the bill argue that it would help address concerns about safety and the potential loss of truck driving jobs to automation. The bill has passed through the legislature with strong support but faces opposition from some within the governor's administration who are concerned about stifling innovation and driving companies making self-driving technologies out of the state. Governor Newsom has until October 14th to make a decision on the bill.
💪🏼 Class I Railroads in North America Seek to Enhance Service Quality to Counter Trucking Competition. Leaders of Class I freight railroads in North America have emphasized the importance of improving service quality to compete with the trucking industry and address the decline in intermodal market share. During the COVID-19 pandemic, service disruptions led to freight backlogs, prompting concerns from shippers and government leaders. In response, railroads are focusing on delivering reliable, resilient, and long-term service. However, intermodal's domestic market share has fallen from 6.7% in 2016 to 5.5% in the second quarter of 2023, resulting in a $4 billion annual revenue loss, according to transportation analyst Larry Gross. To regain market share, intermodal must offer reliable, competitive, and cost-effective services compared to trucking. Railroads have invested in improving operations, train speeds, and on-time performance, but some shippers remain skeptical, given the competitive challenges posed by the trucking industry's capacity tightening over the past year.
The Workday Dash is an aggregation of articles regarding the transportation logistics, trucking, and supply chain industries for November 25, 2024, from iLevel Logistics Inc.