This Week in Logistics News (February 14 – February 20)

West Virginia Oil Car Derailment (from CNN)

West Virginia Oil Car Derailment (from CNN)

The logistics news feeds were on fire this week (pun intended) with notice of supply chain disruptions. In particular, there were two large and destructive oil train derailments, one in West Virginia and another in Ontario, Canada. Thankfully, no serious injuries were reported from the CSX derailment in West Virginia or the Canadian National accident in Ontario. The CSX train was hauling 109 cars, of which 20 caught fire. All of the tank cars were the CPC 1232 model that include upgrades, making them actually safer than the older DOT-111 tankers. Clearing, a number of officials are concerned that the “tougher” model rail cars succumbed to the forces they were designed to resist. Ultimately, there is going to be risk associated with transportation of crude, or any substance for that matter. However, the evidence is leading me to believe that rail transportation of crude is substantially riskier than pipeline, and regulatory authorities would better serve the public by increasing focus on rail safety, and loosening the reigns on pipeline projects.

And now onto the specifics of this weeks news…

The train carrying more than 3 million gallons of crude oil from the North Dakota shale fields is still burning in West Virginia, after 20 tanker cars caught fire from a derailment in West Virginia on Monday. The fire destroyed one house and caused the evacuation of two towns.  Federal investigators probing the area to evaluate environmental damage still have only limited access to the site. The tank cars were the newer, safer CPC 1232 model. The US DOT has recommended that these models be upgraded with better braking systems and thicker hulls. This accent occurred on the heels of an accident two days earlier in Ontario, Canada.

Ontario, Canada had its own oil train derailment this week. The Canadian National train hauling 100 cars was transporting crude oil from the  production source in Alberta to eastern Canada, where a large amount of refining capacity resides. The accident caused subsequent rail disruptions on the line between Montreal and Winnipeg. Rail traffic has resumed running through the derailment area, but at a reduced speed at this time.

Japanese companies had an active week of acquisition activity in the logistics industry. Japan Post Holdings agreed to a $5.1 US Dollar takeover of the Australian logistics company Toll Holdings. The Reuters article quotes Japan Post as stating that the combined entity would be the world’s fifth largest logistics company, in line after FedEx. the move is a large step in Japan Post’s expansion as an international logistics provider. Japan Post Holdings is a large conglomerate with banking, insurance, and postal businesses. Toll Group is a publicly traded Austalian logistics company with over A$8 billion in annual revenues. Earlier in the week, Japan’s Kinetsu Express stated its intention to acquire Singapore-based APL Logistics from Neptune Orient Lines (NOL) for $1.21 billion.

The FAA released a document outlining proposed regulations on the use of drones for commercial purposes. Some of the more prominent restrictions include a maximum altitude of 500 feet and a requirement that the drone remain within sight of the operator and fly during the daytime. These guidelines amount to a greenlight for applications such as inspections and asset management, but serves as a constraint to those companies like Amazon that hope to use drones as a delivery mechanism. However, as my colleague Ralph Rio argued last year on Logistics Viewpoints, dispatching delivery drones from trucks of other delivery vehicles within a neighborhood would still meet the previously stated guidelines.

Long Beach Backup (Mike Kelley)

Long Beach Backup (Mike Kelley)

Gizmodo had some great photos of gridlock at the LA-Longbeach ports. I included this article for that purpose, as I think these photos are truely worth a thousand words.

Amazon opened a state-of-the-art fulfillment center in Washington state about a year ago. Geekwire has a great video that shows the automation and manual processes in use at this center. The automation includes a heavy-duty robotic arm capable of handling heavy loads, Kiva robots, conveyors, other manual and hybrid processes. Check it out if you get a chance.

Finally, from the “last mile logistics” file, Uber opened a food delivery service in Barcelona that is similar to the one it offers in California. This comes after  a judge in December banned its taxi service. The Barcelona delivery service is branded as UberEats, and will serve prepared meals for about 10 Euros, plus a 2.50 Euro delivery fee. That sounds like a deal to me. Sign me up!

This week’s video is from Geekwire . A video of Amazon’s Washington fulfillment center. Enjoy!



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