This Week in Logistics News (July 19 – 25)

I finished my first ARC Market Study this week, looking at the Transportation Management Systems market. On top of that, my colleague, Clint Reiser, and I are wrapping up our omni-channel fulfillment survey, with an upcoming presentation at the annual CSCMP show in September. So it’s been a pretty busy week (month) here. Let’s get right to the news.

The acquisitions keep on coming. The supply chain and logistics space has been full of mergers and acquisitions over the last few years, and there is no sign of this slowing down. Dassault Systèmes announced the signing of an agreement to acquire Quintiq, a provider of on-premise and on-cloud supply chain and operations planning & optimization software, for approximately €250 million. Quintiq solutions are also used to plan and schedule production supply chains at manufacturers, as well as plan and optimize logistics operations. According to the press release, “Quintiq will expand Dassault Systèmes’ DELMIA brand, adding the new product line of Operations Planning and Optimization to the existing ones of Digital Manufacturing and Manufacturing Operations Management. Quintiq provides a new reach into industries such as metals, mining, oil & gas, rail, delivery and freight.”

The future of truckPeloton-auto-trucksing is here. Two weeks ago I noted that Daimler’s autonomous trucks could be ready for roll-out by 2025. Well, Peloton Technology has released a new piece of technology aimed at driving efficiencies. The company has developed a vehicle-to-vehicle communication system that has the potential to transform the trucking industry. By tethering two trucks together using advanced sensing intercommunications, the Silicon Valley startup says they can improve safety while cutting costs for thousands of trucks on the road.

U.S. freight rail traffic for the week ending July 19, 2014 advanced yet again, the Association of American Railroads reported Thursday, July 24, with Canadian rail traffic and Mexican carload traffic also increasing, and only Mexican intermodal failing gain ground. U.S. freight carload traffic rose a healthy 7.6% for the week, measured against the comparable week in 2013, while U.S. intermodal volume rose 5.6%. Total combined U.S. weekly rail traffic notched a 6.7% improvement over year-ago levels. It’s not surprising that Union Pacific announced its freight rose 8% and earnings per share for Q2 rose 20%.

Keeping on the freight theme, the U.S. government wants to phase out thousands of railroad tank cars that carry crude oil within two years once it adopts proposed rules to upgrade safety for trains carrying flammable liquids. Tens of thousands of these older tank cars, known as DOT-111s, will have to be replaced or retrofitted under the proposed rules, announced Wednesday. This puts the U.S. on roughly the same timetable as Canada, which announced a phase out earlier this year. Crude-carrying tank cars would need to upgraded by 2017. The proposed regulations would also give the ethanol industry until 2018 to improve or replace tank cars that carry that fuel. The deadline for cars used to transport other flammable liquids that typically pose less of a hazard than oil or ethanol would extend to 2020.

husi-sh-nuggetsA tainted food scandal in China has now turned its attention to the supply chain. Shanghai Husi Food Co was suspected of using expired meat and was shut down by local regulators in China. The long-time McDonald’s meat supplier was also cut by other fast food chains it supplied. Due to the size of the fast food market in Asia, attention needs to be turned to the supply chain. Experts indicated that suppliers will need to re-examine their supply chains and invest more resources in the supply process.

According to the Cass Freight Index, the freight logistics sector continued to strengthen in June, with both shipment volumes and expenditures rising once again. Both indexes have increased every month since January. June shipment volumes increased 2.4 percent to the highest level since November 2007, just before the recession. Volumes were 6.0 percent higher than a year ago and are up 15.8 percent since the beginning of 2014. The freight expenditures index rose 4.2 percent in June to 2.76, a record high. June 2014 freight spending was 12.1 percent higher than a year ago and is up 15.6 percent since the beginning of 2014.

That’s it for the news this week. Enjoy the weekend and today’s song of the week, City of New Orleans by Willie Nelson.

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