This Week in Logistics News (April 28 – May 4)

logistics newsThis past weekend, I had what I would call an 80’s throwback weekend. On Friday, I went to see a Guns n’ Roses “cover band” in Cambridge. Now this band is made up of musicians that my wife went to college with, so there was a strong college contingent. They also all have real jobs, and use this as an outlet for their musical skill and desire to have a good time. As someone whose first “love” of a band was G n’ R, this was a pretty fantastic night. On Saturday, I took my son to the Red Sox game, which reminded of me of the numerous times my Dad took me to games. The names have changed, but the crowd is still the same. And on Sunday, I took my kids to one event I never attended, even though “Bigfoot” was a force to be reckoned when I was growing up: Monster Jam. We watched monster trucks race around the track, perform tricks, and crush some cars. I can honestly say that the 12-year-old me would have been very jealous. And now, on to this week’s logistics news.

Drone deliveries have certainly been an interesting topic around here. This week, the US Department of Transportation will use its exemption authority to issue certificates to operators of small unmanned aircraft vehicles (UAVs) seeking to transport goods for compensation. This is a big step forward for the potential use of drones for last mile delivery options. The DOT notes that the exemption is not available to air carriers operating aircraft defined as “large” (designed to have a passenger capacity of more than 60 seats or a maximum payload capacity of more than 18,000 pounds.) According to the official notice:

“the DOT aims to establish a procedure to seek an air taxi operator exemption to hold economic authority from the Department of Transportation for companies proposing to engage in certain air transportation operations with [drones].”

Amazon and Walmart continue to push the bounds in their battle for e-commerce. While rumors have been swirling for the last couple of months, Amazon has officially made an offer to purchase a 60 percent stake in Indian e-commerce platform Flipkart. Reports have linked Walmart to Flipkart, with a $10 billion – $12 billion purchase price; the primary investment would be between $1 billion and $2 billion. Amazon’s bid is likely to be about the same as Walmart’s, but reportedly has a $2 billion “break-up” fee.

Starship Technologies have built autonomous robots which have partnered with companies such as Domino’s and Mercedes Benz, as well as been approved for delivery usage by the state of Virginia. The company has now announced a new autonomous delivery service for campuses around the US and Europe, with the electric six-wheelers already carting breakfast sandwiches around a company headquarters in Mountain View, California. Starship now wants to see how the robots fare in the enclosed environments of academic and corporate campuses. Customers can summon the delivery robots by opening the Starship mobile app, which presents them with food ordering options from onsite cafeterias and restaurants. They can then drop a pin on the map to set a meeting point, the robot’s cargo hold is then loaded with the food and it autonomously makes its way to the pin, pushing a notification to the user’s phone when it’s arrived.

The Alliance for Driver Safety & Security, also known as the Trucking Alliance, announced it will push for congressional passage of a new drug testing law to require anyone who applies for a safety-sensitive job in the trucking industry to verify no opioid addiction or illegal drug use for at least 30 days prior to employment.  The Alliance is a coalition of freight and logistics companies that support the adoption of technology and regulations to improve safety in trucking, such as mandatory truck speed limiters, mandatory electronic logging devices, improved driver training and screening, and advanced safety assistance systems. The alliance feels that current drug testing methods are failing truck drivers and the industry, and wants to move towards hair sample testing, as it can detect opioid use for significantly longer than other testing techniques.

Alibaba has launched a blockchain technology initiative to protect product authenticity and improve its supply chain integrity. The initiative will incorporate standards and controls including product tagging with unique QR codes and blockchain technology in a bid to authenticate, verify, record, and provide ongoing reporting of products throughout the shipping process. The initiative has launched a trial program with Australian vitamin brand Blackmores and New Zealand dairy brand Fonterra, along with Australia Post and New Zealand Post, with PwC to act as an advisor. ­­­­­The program will incorporate the shipping of Blackmores’ Odorless Fish Oil products and Fonterra’s Anchor dairy products to China via Tmall Global orders.

DHL is expanding its delivery operations in Germany. Online shoppers will now have the ability to book specific delivery times for any DHL shipment. Initially, it will be possible to select a time between 6pm and 9pm in twenty German conurbations including Berlin, Frankfurt and Munich. DHL Parcel is further expanding its services for millions of parcel recipients in Germany, offering the possibility to arrange a preferred delivery time for any DHL shipment in future. At launch this new service will be available at a promotional price of EUR 1.99 per parcel, and at the end of the introductory period, the premium will increase to EUR 2.99 per shipment.

And finally, the truck driver shortage is raising prices. The latest reports of the trucking industry indicate that freight rates are rising due to the driver shortage, and this is having an impact on consumer goods. The shortage is also leading to late deliveries and empty shelves, which can certainly impact retail pricing. The recent enforcement of ELDs has also resulted in less drivers on the road, which is exacerbating the problem.

That’s all for this week. Enjoy the weekend and the song of the week, Sweet Child O’ Mine by Gun N’ Roses.