This Week in Logistics News (March 3 – 9)

logistics newsThree years ago, Hamilton, the critically acclaimed rap musical about founding father Alexander Hamilton was in its first run Off-Broadway. After a couple of extensions, the show moved to Broadway, and has recently begun touring the US. In case you’ve been living under a rock and haven’t heard of it, the play was written by Lin-Manuel Miranda after reading Alexander Hamilton by Ron Chernow, a biography of Alexander Hamilton. After only a few chapters, Miranda began envisioning the story as a musical. The songs draw inspiration from some of rap’s biggest names, and chronicle the life of Hamilton, from an orphan in the Caribbean to his fatal duel with Aaron Burr. My 7 year old son and 4 year old daughter are obsessed with the soundtrack, and even my 2 year old will sing along to certain parts (Just you wait! Just you wait!). It has become our go-to music in the car, with my son constantly quoting and singing his favorite songs (My Shot in particular). I am fortunate to have tickets to the Boston show later this year, and will report back with a full synopsis. Hamilton’s music is helping me through our latest snow storm. And now, on to this week’s logistics news.

As interest in autonomous trucks heats up, Uber has upped its testing of its self-driving vehicles. The company has been sending self-driving trucks on delivery runs across Arizona for the last three-plus months. In the latest test program, a truck driver meets the autonomous truck at the Arizona state border, which then takes the load across the state. An Uber employee is in the driver’s seat, but does not take control over the vehicle. The truck then meets another truck which finishes the short haul trip. For the test, Uber has been contracting with trucking companies to use their autonomous Volvo rigs.

As Brexit looms, there is significant concern over trade delays. As a result, many UK manufacturers are building up stockpiles of goods to ensure that there will not be a delay and that they can meet the same timescales as before. These manufacturers are also looking to secure more storage capacity to accommodate the stockpiles. Both the EU and UK are trying to reach a deal on the transition phase this month. EU chief Brexit negotiator Michel Barnier has warned any pact is at risk of unraveling until a full agreement on Britain’s departure is approved next year. Britain’s departure from the European Union is scheduled at the end of March 2019.

As my colleague Clint Reiser wrote earlier this week, President Trump announced that the US will impose tariffs of 25 percent on imported steel and 10 percent on imported aluminum. This announcement has been met with harsh international criticism, and the EU is firing back. The EU has drawn up a target list of 100 US goods worth $3.5 billion that it will hit with additional taxes. Many of the products on the list have been targeted for maximum political impact. For example, Bourbon whiskey is produced in Kentucky, which is the home state of Senate majority leader Mitch McConnell. The full list includes Bourbon whiskey, orange juice, jeans, T-shirts, corn and other agricultural products, steel and industrial products, cosmetics, consumer goods, motorbikes, and pleasure boats.

With package theft on the rise, Amazon has expanded a program for proof of delivery. In the program, delivery providers take a picture of where they put the package; the photo is included in the notice of delivery received by shoppers so they know when it arrived and where to look for it. This helps to alleviate customer complaints on figuring out exactly where a package was left, especially if the driver wants to keep it hidden from would-be thieves. It also ensures that drivers are actually making the deliveries. For those who prefer not to have photos of their doors or yards sent to them, customers can opt out of the service on the Amazon website under the help and customer service tab.

Target announced a number of initiatives earlier this week to a group of more than 100 financial analysts, making the case that their strategy would keep the retailer competitive in the fast-changing retail landscape. Target will offer free two-day delivery for items over $35 and to Redcard holders. The retailer will utilize ship-from-store capabilities to help meet these delivery timeframes. The company is actively shipping from 1400 of its 1800 stores. Target is also expanding its drive-up service this year. Under this program, customers who prefer to stay in their cars can place online orders in advance and have a store employee load the items into their trunks within a few minutes of their arrival in the parking lot. The program will expand from 50 test stores in the Twin Cities area last year to nearly 1000 locations by the end of the year.

The home-delivery market is growing rapidly, especially the crowd-sourced model. As I wrote about earlier this year, the top seven global startups, which include Deliveroo, Instacart, New Dada, Postmates, DoorDash, Fetchr, and Deliv, have raised over $2.5 billion in funding since 2011. Well, DoorDash is taking delivery on $535 million investment from the SoftBank, Sequoia Capital, and Singaporean sovereign wealth fund GIC. Tony Xu, DoorDash’s CEO, says the company will use the cash to expand from 600 North American cities to 1600 by year-end. The company charges restaurants a delivery fee of between zero and $5, and takes an undisclosed percentage of the food order. It lets restaurants plug into its app and also provides a white-label service called Drive so consumers can order directly from the restaurant but have their order fulfilled by DoorDash. The company recently announced that El Pollo Loco is expanding its partnership, adding delivery to more than half of its 470 restaurants.

And finally, a group of port truckers has filed a lawsuit against trucking conglomerate XPO Logistics claiming the carrier wrongfully deducted expenses from their paycheck by classifying them as independent contractors instead of company employees. The class-action lawsuit, filed Feb. 26 in Los Angeles Superior Court, accuses the company of denying drivers of earned wages and benefits such as workers’ comp due to their classification as contractors. Lawyers for the drivers say XPO is a “repeat offender” relative to classification of its drivers. A federal court last June ordered XPO to pay nearly $1 million to five XPO Cartage truckers. XPO in a statement said it “knows the vast majority of port drivers value their independence as contractors. We continue to believe in this industry model.”

That’s all for this week. Enjoy the weekend and the song of the week, My Shot from Hamilton.

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