This Week in Logistics News (March 24 – 30)

logistics newsA few weeks ago, I wrote an article about drone deliveries, and whether or not they were actually close to a reality. In that article, I outlined a few practical applications for drones, as well as some of the more hypothetical uses. Well, this week has shown us that aside form practical uses, companies are looking towards the future for possible applications. Amazon, for example, filed yet another patent for a drone system. This time, the patent calls for the drone to react when someone waves their hands or shouts. This mean that if a person waves their arms in a “shooing” or “welcoming” manner, the drone would bounce that reaction off a database and make the appropriate move. At the same time, Walmart has hinted at a drone application that would aid shoppers in stores. In this scenario, a shopper would use a mobile phone or a device provided by the store to summon a drone, which the consumer could then direct to do a price verification of a product or have the drone provide navigation assistance. Both of these scenarios look at what I would call the shortsighted future of drones – namely operating them in close proximity to people. But who knows what the future will hold. And now, on this week’s logistics news.

My colleague Clint Reiser recently wrote about the impact of President Trump’s announcement that the US will impose tariffs of 25 percent on imported steel and 10 percent on imported aluminum. This announcement caused a lot of turmoil around the globe, especially among allies of the US. Well, the White House has come to a resolution. This week, the Trump administration announced that it would exempt the European Union and four other allies — Australia, Argentina, Brazil, and South Korea — from the impending steel and aluminum tariffs. According to US Trade Representative Robert Lighthizer, “President Trump has decided to pause the imposition of the tariffs with respect to those countries.” This comes on the heels of an announcement that Trump had agreed to halt the tariff “based on a certain set of criteria.” The US imports the majority of its steel from Canada, Brazil, South Korea, and Mexico, but all told it imports steel and aluminum from roughly 50 countries.

The sharing economy has received a lot of attention lately, especially as crowd-sourced last mile deliveries become more common place and the “Uberization of Freight” model becomes a reality. Ryder is jumping into the mix with an announcement of a new service – COOP by Ryder. The program is an asset sharing platform that may be the first of its kind in the industry. While a few companies have been using the sharing economy to fill capacity in their trucks, Ryder’s new digital platform allows businesses to list and rent underutilized commercial vehicles within a network of trusted peers. This is basically a ZipCar model for commercial trucks. The company said COOP began with an initial market release in January in the Atlanta metro area with a group of more than 100 fleet owners and, based on that pilot test, Ryder will now fully roll out COOP to the Atlanta market in April, with several other major markets anticipated to be added in 2019.

Speaking of the sharing economy, Uber is facing a problem it has yet to face in its business – a driver shortage. Uber Freight launched with a vision of matching drivers with available capacity to available loads to reduce deadhead miles. However, this has not been as easy as the company thought. As a result, Uber Freight this week launched an incentive program offering discounts on fuel, tires, maintenance, and the purchase of new and used vehicles. Drivers who use the Uber Freight app to book a load at least once a month are eligible for the discounts under agreements Uber struck with various service providers.

Since acquiring Whole Foods, Amazon has been looking at ways to bolster its e-commerce grocery business. It turns out that Amazon is searching for bigger Whole Foods locations in cities that can serve as both grocery stores and urban distribution centers for delivering goods to online shoppers. These deliveries are all about speed and scale. Amazon is seeking more retail space that can accommodate grocery aisles and storage for the most popular items purchased from Amazon’s website, like consumer electronics, bestselling books, and yoga pants. According to sources, Whole Foods is also working with Regency Centers Corp., one of its largest landlords, on a project to convert parking areas at existing stores into stalls for Amazon delivery contractors to load up their orders.

Blockchain has certainly been a hot topic lately, with more and more companies looking at the technology to track goods from the point of origin to the final destination. Starbucks is hopping on the bandwagon with a pilot program to create transparency with “bean to cup” data as it tracks coffee beans from Costa Rica, Colombia, and Rwanda. The use of blockchain is a part of Starbucks’s commitment to sustainability and ethically sourced coffee beans within its supply chain. The pilot program will take place over the next two years, and the Sustainable Coffee Challenge, a call to action the company co-announced with Conservation International in 2015, will track how impactful the blockchain technology is to the farmers. Starbucks plans to publicly share its results.

Sustainability is another topic that has been at the center of supply chain initiatives over the last few years. According to a new report by International Transport Forum (ITF), the shipping industry could be near carbon-free by the year 2035. The report studies four different decarbonization pathways which could reduce international shipping’s CO2 emissions between 82% and 95% below the level projected for 2035. Alternative fuels and renewable energy are at the top of the list, as well as operational improvements including slower ship speeds and more efficient ships.

Reps. Duncan Hunter (R-Calif.) and Trey Hollingsworth (R-Ind.), with support from the International Foodservice Distributors Association and the American Trucking Associations, this week introduced the DRIVE Safe Act. The ATA says the legislation addresses the massive driver shortage affecting the movement of commerce in the US, while also promoting enhanced safety training for emerging members of this growing workforce. The DRIVE Safe Act will help train younger drivers far and above current standards. Under the legislation, once a driver has met the requirements to obtain a CDL, they may begin a two-step program of additional training which includes rigorous performance benchmarks that each candidate must achieve. The program will require these drivers to complete at least 400 hours of on-duty time and 240 hours of driving time with an experienced driver in the cab with them.

And finally, I mentioned above how the sharing economy can disrupt an industry and bring new businesses to the forefront. Well, sometimes, the window closes quickly on these businesses. This is the case for Shyp, a packaging and shipping startup that used contract workers to pick-up, pack, and ship orders. The premise was simple – a customer takes a picture of the item they are shipping through the Shyp app, and this starts the process; a Shyp courier arrives to ship the package through the lowest-cost option. However, like many startups, the company was simply unable to scale beyond its launching point in San Francisco. CEO Kevin Gibbon announced that the company would be shutting down in a blog post on Wednesday afternoon, with the company ending operations immediately after.

That’s all for this week. Enjoy the weekend, and the song of the week, China Grove by the Doobie Brothers.

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