Mark Solomon joined DC VELOCITY as senior editor in August 2008, and was promoted to his current position on January 1, 2015. He has spent more than 30 years in the transportation, logistics and supply chain management fields as a journalist and public relations professional. From 1989 to 1994, he worked in Washington as a reporter for the Journal of Commerce, covering the aviation and trucking industries, the Department of Transportation, Congress and the U.S. Supreme Court. Prior to that, he worked for Traffic World for seven years in a similar role. From 1994 to 2008, Mr. Solomon ran Media-Based Solutions, a public relations firm based in Atlanta. He graduated in 1978 with a B.A. in journalism from The American University in Washington, D.C.
Shippers and truck brokers sued over their alleged negligent hiring of a trucker involved in a serious or fatal accident would need only show the carrier held proper federal operating authority and met minimum insurance requirements to likely prevail in court, according to critics of a Senate bill passed last week reauthorizing federal transport spending for the next six years.
The provision, contained in legislation approved by the Senate Commerce Committee, makes it significantly easier for shippers and brokers to insulate themselves from the legal consequences of failing to vet a carrier's safety record before hiring the carrier, highway-safety advocates said today in a conference call with reporters. Henry Jasny, vice president of Advocates for Highway and Auto Safety, an advocacy group, said the bill requires shippers and brokers to meet just the bare-minimum standards for carrier hiring and still successfully defend themselves in court if they are sued for damages after the carrier was in an accident.
Personal-injury lawyers have brought a number of successful cases in state courts against brokers on grounds that they were negligent in reviewing a carrier's safety history before hiring them to move a shipper's load. Plaintiffs' attorneys have also persuaded juries that carriers were in the brokers' employ at the time of an accident.
Brokers have maintained that they only engage truckers on a transactional basis, that drivers are not on brokers' payrolls, and that they do a thorough job of vetting a carrier's safety fitness beforehand. The Transportation Intermediaries Association (TIA), the lead broker trade group, has lobbied Congress for a nationwide hiring standard for carriers that would set specific criteria for choosing a safe motor carrier. Robert A. Voltmann, TIA's president and CEO, was unavailable to comment.
The alleged broker-friendly language was just one item on a laundry list of concerns voiced by safety advocates over the bill, the "Comprehensive Transportation and Consumer Protection Act of 2015." The bill was approved last Wednesday by a 13-11 margin, with no Democrat voting for its passage. It will be consolidated with legislation passed by the Senate Environment and Public Works Committee to form the Senate's version of what has been commonly known as the "Highway Bill." The consolidated bill is expected to reach the Senate floor as early as this week.
Sens. Richard Blumenthal (D-Conn.) and Edward Markey (D-Mass.), appearing on the conference call, said they would pull out all the stops to prevent passage of a bill they said is anti-safety. "This is a devastating missed opportunity" to reduce accidents and deaths on the road, Blumenthal said during the call.
Sen. Dianne Feinstein (D-Calif.), is expected to introduce an amendment to prevent the rollout of 33-foot twin trailers on all federal-aid highways until the Department of Transportation conducts a study on their safety. The current federal limit is 28 feet per trailer, though 18 states allow the larger equipment on their portions of federal-aid roads. Supporters of the provision, which has been included in House and Senate versions of the Department of Transportation's fiscal year 2016 appropriations, said the longer trailers come with equally long wheelbases that improve stability and performance. They added that the longer trailers would enable shippers to load more cargo into the same number of vehicles, thus cutting the number of trips by the thousands. Safety groups said the nation's highways, in particular merge lanes and on-off ramps, were not designed or built to accommodate tractor-trailers 10 feet longer than the current threshold.
Advocates for Highway and Auto Safety attacked a provision to remove from public view the carrier safety scores developed under the Federal Motor Carrier Safety Administration's "Compliance, Safety, and Accountability" program, better known as CSA. The scores would not be made public until the Transportation Research Board, required under the Commerce Committee's bill to study the controversial CSA program, publishes its report, and recommendations from a corrective action plan have been implemented. The American Trucking Associations (ATA) has long urged FMCSA to withdraw the carrier grades, saying the methodology doesn't effectively identify high-risk carriers and relies on a limited amount of data. Safety groups said the measure shields unsafe carriers from necessary public scrutiny.
Safety advocates also said they would oppose language in the bill that would authorize the DOT secretary to launch a six-year pilot program to allow states to enter into reciprocal agreements authorizing licensed truck drivers between 18 and 21 to operate on interstate highways. Under current law, drivers cannot operate a commercial motor vehicle in interstate commerce until they turn 21. However, licensed drivers between 18 and 21 can operate within the borders of the states where they are licensed.
Jackie Gillan, head of the group, said accident rates in states that allow 19- and 20-year-old drivers to operate in intrastate commerce are 4 to 6 times higher than in states that don't. Gillan said lawmakers should be working toward limiting the ability of drivers under the age of 21 to operate heavy-duty trucks, not expanding their opportunities. Trucking interests that face a worsening driver shortage said it is absurd that a driver can, for example, operate 500 miles within California but not be allowed to drive 50 miles to and from any of the states that border it.
The Senate is racing to beat a deadline of July 31, when the most recent extension of federal transport-funding authorization is set to expire. The House voted last week to extend the program until the end of the year so it could work on a long-term plan to fund it. The Senate has yet to vote on an extension. The White House has said it will support an extension until the end of the year, but sources in Washington said President Obama has no intention of going beyond that.
Federal projects are financed through excise taxes on diesel fuel and gasoline. The proceeds are deposited in a trust fund that disburses the money. Those taxes have not been raised since 1993, and federal spending on transportation has been falling in inflation-adjusted terms as vehicle-miles traveled have declined and more fuel-efficient vehicles require fewer fill-ups at gas stations.
North American manufacturers have begun stockpiling goods to buffer against the impact of potential tariffs threatened by incoming Trump Administration, building up safety stocks to guard against higher imported costs, according to a report from New Jersey business software firm GEP.
That surge in orders has sparked a jump in production, shrinking the level of spare capacity in global supply chains to its lowest level since June, the firm said in its “GEP Global Supply Chain Volatility Index.” By the numbers, that index rose to -0.20 in November, from -0.39 the month before, based on GEP’s measurement of demand conditions, shortages, transportation costs, inventories, and backlogs from its monthly survey of 27,000 businesses.
Another impact of the trend has been to trigger a surge in procurement activity by manufacturers in Asia—especially China—as new orders rebounded sharply. Only India reported a greater rise in raw material purchases than China in November. And preparations to ramp up production even further were evidenced data showing factory procurement activity across Asia rising at its fastest pace for three-and-a-half years, GEP said.
In sharp contrast, Europe's industrial recession worsened in November, in large part due to Germany's deepening manufacturing downturn. Factories in that region went deeper into retrenchment mode, as demand for inputs from manufacturers in Europe was its weakest since December 2023.
"In November, U.S. manufacturers, particularly in the consumer goods sector, increased their safety stocks to help blunt any immediate tariff increases," John Piatek, vice president, GEP, said in a release. "In contrast, Chinese manufacturers are getting busier as a result of government stimulus and growth in exports, led by automotives and technology products. Strategically, many global companies have a wait-and-hope approach, while simultaneously planning to remake their global supply chains to respond to a tariff and trade war in 2025 and beyond."
In response to booming e-commerce volumes, investors are currently building $9 billion worth of warehousing and distribution projects under construction in the U.S., with nearly 25% of the activity attributed to one company alone—Amazon.
The measure comes from a report by the Texas-based market analyst firm Industrial Info Resources (IIR), which said that Amazon is responsible for $2 billion in warehousing and distribution projects across the U.S., buoyed by the buildout of fulfillment centers--facilities that help process orders and ship products directly to end customers, ensuring deliveries of online goods from retailers to buyers.
That investment is inspired by U.S. Census Bureau data showing $300.1 billion in a preliminary estimate of U.S. retail e-commerce sales for third-quarter 2024, adjusted for seasonal variation but not for price changes, compared to $287.5 million in the first quarter, and an increase of 7.4% compared with third-quarter 2023. In addition, e-commerce sales accounted for 16.2% of total retail sales in the third quarter of this year, the report said.
Private equity firms are continuing to make waves in the logistics sector, as the Atlanta-based cargo payments and scheduling platform CargoSprint today acquired Advent Intermodal Solutions LLC, a New Jersey firm known as Advent eModal that says its cloud-based platform speeds up laden container movement at ports and intermodal hubs.
According to CargoSprint—which is backed by the private equity investment firm Lone View Capital—the move will expand the breadth of global trade that it facilitates and enhance its existing solutions for air, sea and land freight. The acquisition follows Lone View Capital’s deal just last month to buy a majority ownership stake in CargoSprint.
"CargoSprint and Advent eModal have a shared heritage as founder-led enterprises that rose to market leading positions by combining deep industry expertise with a passion for innovation. We look forward to supporting the combined company as it continues to drive efficiency in global trade,” said Doug Ceto, Partner at Lone View Capital.
Terms of the deal were not disclosed, but Parvez Mansuri, founder and former CEO of Advent eModal, will act as Chief Strategy Officer and remain a member of the board of directors of the combined company.
Advent eModal says its cloud-based platform, eModal, connects all parts of the shipping process, making it easier for ports, carriers, logistics providers and other stakeholders to move containers, increase equipment utilization, and optimize payment workflows.
Airbus Ventures, the venture capital arm of French aircraft manufacturer Airbus, on Thursday invested $10.5 million in the Singapore startup Eureka Robotics, which delivers robotic software and systems to automate tasks in precision manufacturing and logistics.
Eureka said it would use the “series A” round to accelerate the development and deployment of its main products, Eureka Controller and Eureka 3D Camera, which enable system integrators and manufacturers to deploy High Accuracy-High Agility (HA-HA) applications in factories and warehouses. Common uses include AI-based inspection, precision handling, 3D picking, assembly, and dispensing.
In addition, Eureka said it planned to scale up the company’s operations in the existing markets of Singapore and Japan, with a plan to launch more widely across Japan, as well as to enter the US market, where the company has already acquired initial customers.
“Eureka Robotics was founded in 2018 with the mission of helping factories worldwide automate dull, dirty, and dangerous work, so that human workers can focus on their creative endeavors,” company CEO and Co-founder Pham Quang Cuong said in a release. “We are proud to reach the next stage of our development, with the support of our investors and the cooperation of our esteemed customers and partners.”
As another potential strike looms at East and Gulf coast ports, nervous retailers are calling on dockworkers union the International Longshoremen's Association (ILA) to reach an agreement with port management group the United States Maritime Alliance (USMX) before their current labor contract expires on January 15.
The latest call for a quick solution came from the American Apparel & Footwear Association (AAFA), which cheered President-elect Donald Trump for his published comments yesterday indicating that he supports the 45,000 dockworkers’ opposition to increased automation for handling shipping containers.
In response, AAFA’s president and CEO, Steve Lamar, issued a statement urging both sides to avoid the major disruption to the American economy that could be caused by a protracted strike. "We urge the ILA to formally return to the negotiating table to finalize a contract with USMX that builds on the well-deserved tentative agreement of a 61.5 percent salary increase. Like our messages to President Biden, we urge President-elect Trump to continue his work to strengthen U.S. docks — by meeting with USMX and continuing work with the ILA — to secure a deal before the January 15 deadline with resolution on the issue of automation,” Lamar said.
While the East and Gulf ports are currently seeing a normal December calm post retail peak and prior to the Lunar New Year, the U.S. West Coast ports are still experiencing significant import volumes, the ITS report said. That high volume may be the result of inventory being pulled forward due to market apprehension about potential tariffs that could come with the beginning of the Trump administration, as well as retailers already compensating for the potential port strike.
“The volumes coming from Asia on the trans-Pacific trade routes are not overwhelming the supply of capacity as spot rates at origin are not being pushed higher,” Paul Brashier, Vice President of Global Supply Chain for ITS Logistics, said in a release. “For the time being, everything seems balanced. That said, if the US West Coast continues to be a release valve for a potential ILA strike supply chain disruption, there is a high risk that both West Coast Port and Rail operations could become overwhelmed.”