I had the pleasure of visiting Costa Rica earlier this week. Not only is the country beautiful, but the transportation infrastructure appeared more sophisticated than other countries I have visited in Latin America. Virtually all of the trucks carrying freight along route 34 were new, high-end Freightliners. I was impressed by the overall economy and its vibrant transportation industry. I plan on learning more about the transportation business of Costa Rica. Maybe I will include my findings in a future post. Now on to this week’s news:
- What You Need to Know About the GM Recalls (WSJ)
- Boeing Not Relaxing Supply Chain Savings Push
- Descartes Acquires U.S. Based Computer Management
- Who put the cockroach in my supply chain?
- FTR’s Trucking Conditions Index Reflects Unprecedented Capacity Constraints
- Online Grocer Fresh Direct offers Fresh Eagle Caught Salmon
The General Motors recall of faulty ignition switches was one of the most prominent US news stories this week. CEO Mary Barra testified before congress and provided the media with some interesting news bits. The faulty part was manufactured by Delphi, a GM supplier. And this brings up what I consider to be an obvious point that may be worth explicitly mentioning- It’s difficult for a given company to maintain product quality and supply chain integrity if such company doesn’t consider product quality and supply chain integrity to be a priority. Here are a couple quotes from the WSJ article that illustrate this point:
“Why in the world would GM purchase parts [switches] that don’t meet specifications?” asked Rep. Joe Barton (R., Texas), “If the part doesn’t meet the specification, why in the world would you not refuse it?”…….An email chain that appeared in the Congressional investigation shows management estimated that replacements would cost an extra 90 cents per car, while only saving an estimated 10-15 cents in warranty costs.
A Reuters article stated that Delphi told U.S. congressional investigators last week that GM approved the original part in 2002, despite the fact it did not meet GM specifications. Of course, the insinuation is that GM wasn’t willing to sacrifice the short term financial cost to achieve long term product quality. It will be interesting what other details are uncovered during this investigation.
Descartes announced earlier this week it’s acquisition of US based Computer Management. Computer Management USA is a provider of security filing solutions and air cargo management solutions for airlines and their partners. This acquisition, with its air cargo specialization focused on US market, is complementary to Descartes’ prior global trade acquisition of KSD that expanded Descartes’ European customs and compliance footprint.
An opinion piece in CSOonline discusses the supply chain risks inherent in information technology, specifically pre-installed malicious applications that may be present in one’s mobile devices. This can be viewed as a supply chain issue for the operating system providers, Android OS in the example outlined, and as a concern for companies that purchase or allow employee connectivity to these devices. The article asks, “If the supply chain has been compromised, can buyers be sure that the shiny new device they just pulled out of the box doesn’t have a compromised operating system, or event more troubling, compromised embedded software?” Good question. Maybe I should renew my virus protection subscription afterall.
FTR’s Trucking Conditions Index (TCI) for February came in slightly below January’s reading. However, the article states that severe weather likely had a negative impact on the environment, and if adjusted for weather February would likely have been the tightest truck market on record. The article notes that the market has not reached a
tipping point where prices would be bid up through the summer months, but cautions that it would only take a relatively modest uptick in demand from the industrial sector for capacity to tighten significantly further.
Organic and sustainable foods have become increasingly popular in today’s culture. Also, today’s business environment in many areas is ripe for direct delivery of groceries from online retailers. Well, online
Grocer Fresh Direct has harnessed these trends and taken grocery delivery to the next level by offering fresh Eagle caught salmon! Extending its “fresh from the farm” image, the grocer now delivers salmon caught by wild eagles from the lakes of upstate New York. That was my favorite logistics related April fools joke this year.Have a great weekend!