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.
The five-year, $305 billion federal transport spending bill negotiated by House and Senate conferees has given freight interests the best seat at the table they've ever had. But freight is still not on the dais.
The compromise version, announced yesterday afternoon, allocates $4.5 billion in grants for what are considered "nationally significant" freight and highway projects. The program provides up to $500 million in funding for nonhighway projects that nevertheless improve the movement of highway freight. The bill provides an additional $6.3 billion to a formula program that states can use to facilitate freight mobility on a national-highway freight network. It also creates a multimodal freight policy, and it directs the Department of Transportation to establish a multimodal freight network that would identify the segments of the national freight-moving system most critical to goods transport. The industry has lobbied for years to have such an endeavor codified.
The bill, known as the "Fixing America's Surface Transportation" (FAST) Act, now returns to the House and Senate for floor votes. Each chamber must adopt the bill and vote for its final passage. If that happens, the bill is sent to President Obama's desk for signature. The current law, which was signed in July 2012 and has since been living on short-term extensions, expires Dec. 4. The so-called FAST Act would be the first transport-spending bill since 2005 that was more than 27 months in duration.
Never before has freight been showered with so much money and attention from a federal transport-spending bill. For the Coalition for America's Gateways and Trade Corridors (CAGTC), a public-private intermodal advocacy group that has spent 15 years arguing for a minimum $2 billion annual investment in the nation's freight network, the outcome was all it could have hoped for. "We are thrilled to see conferees recognize so many of the coalition's long-standing priorities," CAGTC President Leslie Blakey said in a statement. Blakey said the size of the proposed funding would "increase the efficiency and reliability" of the nation's transport and logistics network.
From a process standpoint, the bill streamlines the path of funding freight projects, which are generally large in scale and which cross multiple jurisdictions, causing delays and conflicts, according to CAGTC.
Despite the funding breakthrough, freight interests—particularly the trucking industry—got almost nothing that they sought. Negotiators dropped an amendment that would have established a federal hiring standard for motor carriers. The initial proposal would have deemed a trucker to be fit if it were properly licensed, had sufficient insurance, and received a better than unsatisfactory safety rating from the Federal Motor Carrier Safety Administration (FMCSA), the agency that oversees the truck, freight brokerage, and freight forwarding sectors. The amendment, which had been contained in the House's version of transport funding legislation, would have qualified a motor carrier as fit even if it were unrated by FMCSA.
Industry groups said that because the agency lacks the resources to conduct full safety reviews of most of the nation's 530,000 registered truckers, the original bill threatened to exclude thousands of operators that remain unrated, yet operate in a satisfactory manner.
Negotiators also dropped an amendment requiring DOT to develop a program allowing licensed drivers between the ages of 19 years, six months, old and 21 years old to operate commercial motor vehicles in interstate commerce as long as the routes were between adjacent states that enter into special bistate agreements. Currently, commercial drivers under the age of 21 cannot drive across state lines, though they can operate within the boundaries of their state of residence. However, conferees adopted a pilot program allowing certain under-21 military veterans to drive across state lines.
Conferees agreed to language directing FMCSA to commission a three-year study by the Transportation Research Board (TRB) of the agency's controversial "Compliance, Safety, and Accountability" program (CSA), which grades carriers based on a series of metrics and then assigns them performance scores under what is known as a Safety Measurement System, or SMS. The bill requires FMCSA to remove SMS scores and analysis, but allows the raw data used to compile the scores to remain in public view. On that score, negotiators bowed to the language contained in the Senate version of transport funding legislation, which was passed in July. The House version, passed in early November, would have removed all data elements from public scrutiny. CSA's critics argue that the scores are based on flawed methodology, and discriminate against many of the thousands of truckers that operate safely and legally.
The legislation does not call for raising excise taxes on diesel fuel and gasoline, the primary mechanism for funding transport projects, keeping the tax levels unchanged for the 22nd year. The bill would be financed in part by a one-time $19 billion draw of Federal Reserve surplus funds and by a cut in the 6-percent dividend that national banks receive from the Fed. The dividend would be reduced by an amount tied to yields on 10-year U.S. Treasuries, currently about 2.2 percent. If Treasury yields rose higher than 6 percent, the Fed wouldn't pay the banks more. Banks with $10 billion or less in assets would be exempt from the cut.
Funds would also be raised by selling oil from the nation's Strategic Petroleum Reserve, which serves as an emergency source of oil in the event overseas supplies are disrupted. The reserve stood at 695.1 million barrels as of the end of November, below its capacity of 727 million barrels.
As the conference bill returns to both chambers, the debate may now center on the manner in which the programs would be paid for. Sen. Tom Carper (D-Del.) has already gone on record saying he would vote against the legislation because the conferees resorted to accounting gimmickry and other revenue-raising techniques that have nothing to do with transportation. Carper had proposed a doubling of motor-fuels taxes that would go directly toward road infrastructure improvements.
For the freight industry, the conferees' report, though not ideal, is a significant improvement over what had—or had not—come before. Not only will there be a higher level of stability that comes with a five-year funding timetable, but the freight side, which has historically been shunted to the back of the bus when it came to Congressional funding, has finally realized tangible benefits from the process. "While not perfect, this bill is a tremendous step forward for trucking in many respects," said Pat Thomas, senior vice president of state government affairs for Atlanta-based UPS Inc. and chairman of the American Trucking Associations (ATA), the trade group representing the nation's largest motor carriers.
Amazon package deliveries are about to get a little bit faster—thanks to specially outfitted delivery vans and the magic of AI.
Last month, the mega-retailer introduced its Vision-Assisted Package Retrieval (VAPR)solution, an AI (artificial intelligence)-powered system designed to cut the time it takes drivers to retrieve packages from the back of the van.
According to Amazon, VAPR kicks in when the van arrives at a delivery location, automatically projecting a green “O” on all packages that will be delivered at that stop and a red “X” on all other packages. Not only does that allow the driver to find the right package in seconds, the company says, but it also eliminates the need to organize packages by stop, read and scan labels, and manually check the customer’s name and address to ensure they have the right parcels. As Amazon puts it, “[Drivers] simply have to look for VAPR’s green light, grab, and go.”
The technology combines artificial intelligence (AI) with Amazon Robotics Identification (AR-ID), a form of computer vision originally developed to help fulfillment centers speed up putaway and picking operations. Linked to the van’s delivery route navigation system, AR-ID replaces the need for manual barcode scanning by using specially designed light projectors and cameras mounted inside the van to locate and decipher multiple barcodes in real time, according to the company.
In field tests, VAPR reduced perceived physical and mental effort for drivers by 67% and saved more than 30 minutes per route, Amazon says. The company now plans to roll out VAPR in 1,000 Amazon electric delivery vans from Rivian by early 2025.
We are now into the home stretch of the holiday shopping season—the biggest retail bonanza of the year. By now, many shoppers have already made their purchases and are putting the final touches on their gifts. Some of us procrastinators have not even started. Isn’t that why online shopping was invented?
Here are some interesting facts about Americans’ holiday shopping patterns. The National Retail Federation estimates that consumer spending for the holidays will average $902 per person. Some $641 of that will be for gifts, with the remainder spent on food, decorations, and other holiday items.
Many of those purchases will be online, where more than 21% of all consumer transactions now occur. A recent report from DHL eCommerce reveals that 61% of U.S. shoppers buy online at least once a week, and 84% browse online one or more times a week.
We also buy a range of goods that way—63% buy clothing and footwear through e-commerce sites, according to the DHL report. Next most popular were consumer electronics at 33%, followed by health supplements at 30%.
That first category is interesting, because apparel and footwear are also among the most widely returned items, especially when bought as gifts. Either they don’t fit properly, or they aren’t quite what the recipients had in mind—which means that each January, retailers must cope with a flood of returns.
Of course, returns are not a seasonal phenomenon; consumers return goods—particularly those bought online—year round. Between 25% and 35% of all goods purchased via e-commerce are returned, depending on whose figures you believe. By comparison, only 8% to 9% of products bought in stores, where we can see the actual items and try on clothing and shoes, end up being returned.
Try-ons are not possible with apparel sold online, which leads to the common practice of “bracketing,” where customers order an item in multiple sizes, pick the one that fits best, and send back the rest. The seller typically absorbs the reverse logistics costs—and those costs can be significant. The retail value of returned consumer items totals around $745 billion each year. According to Narvar, a company that helps retailers manage the post-purchase customer experience, more than 90% of returned products have nothing wrong with them. They simply weren’t wanted or needed.
So as you make those final holiday selections, help your fellow supply chain professionals. Choose your gifts wisely to reduce the chances they’ll be returned. And remember, gift cards are always nice.
Funds are continuing to flow to companies building self-driving cars, as the Swiss startup Embotech today said it had raised $27 million to expand autonomous driving solutions for logistics in Europe and beyond, including U.S. operations by the end of 2025.
The Zurich firm said it would use the new funding to help the company scale up its Automated Vehicle Marshalling (AVM) and Autonomous Terminal Tractor (ATT) solutions in Europe, and ultimately in the United States, Middle East, and Asia.
Embotech—which is short for “embedded optimization technologies”—says it has already secured multi-year rollout contracts for its AVM solution in finished vehicle logistics and for its ATT solution for port and yard logistics applications.
Specifically, Embotech began rolling out its AVM solution in 2023 with automaker BMW. The technology guides new BMW vehicles along a one-kilometer route between two assembly facilities, through a squeak and rattle track, and to the finishing area – with no driver needed at any stage of the journey. That will now expand under a multi-year contract to install the AVM solution in six additional BMW passenger car factories worldwide by the end of 2025, including BMW’s plant in Spartanburg, South Carolina.
And for its ATT business, Embotech is gearing up for a major rollout to haul shipping containers at Europe's largest port, the port of Rotterdam in the Netherlands, with 30 units set to be deployed over the next 2 years. The electric ATTs are equipped with Embotech’s Level 4 Autonomous Vehicle (AV) Kit, which enables them to operate autonomously in complex, mixed traffic situations. Embotech’s autonomous tractors use a combination of LIDAR, cameras, and GPS to detect obstacles in all weather conditions and achieve localization accuracy of less than 5 cm.
According to Embotech, its autonomous driving solutions deliver benefits such as increasing operational efficiency through 24-hour operation, flexible peak handling, and improved transparency with digital integration.
The “series B” round was led by Emerald Technology Ventures and Yttrium, with additional funds from BMW i Ventures, Nabtesco Technology Ventures, Sustainable Forward Capital Fund, RKK VC and existing investors. “Embotech impressed us with their unique, highly adaptable autonomous logistics solution,” Axel Krieger, Partner at Yttrium, said in a release. “The company tackles the global logistics challenge for both commercial and passenger vehicles. With a strong orderbook as well as proven industry partnerships, Embotech is uniquely positioned to lead the market. An investment that aligns perfectly with Yttrium’s goal to empower tomorrow’s B2B technology champions."
The private equity-backed warehousing and transportation provider Partners Warehouse has acquired PSS Distribution Services, a third-party logistics (3PL) provider specializing in warehousing, distribution, and value-added services on the East Coast, the company said today.
The move expands Partners Warehouse’s reach from its current territories, which stretch from its Elwood, Illinois, headquarters to its two million square feet of warehousing and rail transloading facilities across eight locations in Illinois, California, and Dallas.
In addition to adding East Coast operations to that footprint, the move will also strengthen Partners’ expertise in the food and ingredients sector, enhance its service capabilities, and improve the business’ capacity to support existing and new clients who require a service provider with a national footprint, the company said.
From its headquarters in Jamesburg, New Jersey, PSS brings experience across industries including food, grocery, retail, food service, direct store distribution (DSD), and e-commerce. The company is known for its state-of-the-art facilities and food-grade warehousing options.
“This acquisition marks a significant milestone in Partners Warehouse’s expansion strategy,” Nick Antoine, Co-Founder, Co-CEO, and Managing Partner of Red Arts Capital, said in a release. “The addition of PSS enables us to grow our capacity and broaden our service offerings, delivering greater value to our clients at a time when demand for warehousing space continues to rise.”
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Photo courtesy of the Association of Equipment Manufacturers (AEM)
Think you know a lot about manufacturing? Your hard-won knowledge might be about to pay off in the form of a brand-new pickup truck. No, you don’t have to physically assemble the vehicle. But you could win a Ford F-150 by playing an industry-themed online game.
The organization says the game is available to anyone in the continental U.S. who visits the tour’s web page, www.manufacturingexpress.org.
The tour itself ended in October after visiting 80 equipment manufacturers in 20 states. Its aim was to highlight the role that the manufacturing industry plays in building, powering, and feeding the world, the group said in a statement.
“This tour [was] about recognizing the essential contributions of U.S. equipment manufacturers and engaging the public in a fun and interactive way,” Wade Balkonis, AEM’s director of grassroots advocacy, said in a release. “Through the Manufacturing Challenge, we’re providing a unique opportunity to raise awareness of our industry and giving participants a chance to win one of the most iconic vehicles in the country—the Ford F-150.”