This Week in Logistics News (January 23 – 29)

snow truckLast week saw a major snowstorm cripple much of the Mid Atlantic. Luckily, living just outside of Boston, we were dealt just a glancing blow. After last year’s winter, it was nice to have a two-foot plus snowstorm not slam directly into us. But the storm certainly left many states to our south reeling and basically at a standstill. Highways were closed to traffic, trucks were stuck on the roads, and goods could not be delivered. For many products, this would only be a minor inconvenience. But for those trucks delivering necessities, this became a potential moment of crisis. As a result, North Carolina, South Carolina, Tennessee, Virginia, and West Virginia issued temporary and limited hours-of-service exemptions for certain relief load haulers. What this means is that these states waived hours exemptions for drivers hauling essential fuel, foods, and medical supplies. It’s good to see the industry step up in a time of crisis.

And now, on to the news.

amazon logoAmazon is gearing up to expand its footprint in Europe. One of the main drivers for this growth is going to be expanding on a service that has proved quite successful in the UK so far: online grocery shopping and delivery. With more households in closer proximity, online grocery shopping is better suited in the UK and other European cities than in the US. However, food retail still lags in terms of online commerce. But with Amazon planning to add several thousand more employees on top of the already 40,000 in Europe, they will have the man power to roll out more online grocery options.

A study published this week by driver recruiting and retention firm Stay Metrics reveals that truck operator mileage sees a jump when carriers allow them to take requested time off from work. The study, which looked at data from 682 drivers and 6,487 driver months, modeled time off requests that were met to find the effects on three variables for desirable driver performance: bonus rate, miles driven, and total bonus pay. The model suggests that for each time off request met, their bonus rate increased nearly 3% the following month, they traveled 218 more miles the following month, and total bonus pay increased 5%.

project wingThe patent filing for Google’s Project Wing reveals how the drones could deliver your packages. According to the patent, Google has developed “mobile delivery receptacles” that work hand in hand with its delivery drones. The “mobile delivery receptacles” are remote boxes with wheels on the ground and they communicate and guide the drones in the sky via infrared beacons or lasers. The drone will fly down to ground level and transfer its package to the mobile box, which then secures it and brings the package to a holding location. At this point, it will be ready for customer pick-up. Of course there are still pending FAA regulations that need to be navigated before this delivery mechanism become a reality.

Anthony_Foxx_official_portraitIn his final year as US Transportation Secretary, Anthony Foxx has big plans. There are two main items on his to do list: tear down infrastructure that isolates communities and overhaul the way federal transportation funding distributed to states and cities. When it comes to supply chain logistics, the big piece here is the latter. Foxx called for an overhaul of the way the federal government doles out transportation money. He said the current system, which distributes money primarily through states, “prevents local governments from being able to effectively address some of the most important issues facing their communities.” He also argued that money should be distributed based on current demand for services, not by predetermined formulas. By changing the way money is distributed, it could make for more timely and efficient repairs to roads and bridges which are major thoroughfares for trucks.

According to a new study by JLL, industrial and supply chain real estate occupiers and investors alike experienced a record-breaking year in 2015. The study also says strong demand for logistics facilities should remain consistent globally during 2016 and rental growth should also continue across all markets of the world in 2016 and through 2017. These findings are not surprising considering the amount of investments in e-commerce warehouses and distribution centers around the world. Even as the supply of available space continues to contract, demand continues to rise, meaning rents and price per square footage will continue to rise as well.

Hot-states-map-for-vans-01272016And finally, DAT’s Hot States map as a general rule got lighter last week, reflecting declining demand on the spot market for trucks pulling dry vans — the load-to-truck ratio fell from 1.7 to 1.5 loads per truck. That brings the ratio for January to date down to a seasonally tepid 1.9. Demand is likely to heat up in the Mid-Atlantic and Southeast regions this week, as the area digs out from under 2 to 3 feet of snow.

That’s all for this week. Enjoy the weekend and the song of the week, Simon and Garfunkel’s Hazy Shade of Winter.

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