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 U.S. Chamber of Commerce proposed today a five-year, 25-cent-a-gallon increase in the federal motor fuels tax, the first such increase in 25 years, which would fund improvements to the country's flagging road transport infrastructure. The Chamber also endorsed the concept of private-public sector partnerships to finance upgrades to U.S. ports, airports, and inland waterways.
The hike in the federal excise tax on gasoline and diesel fuel, which would be indexed for inflation and improvements in fuel economy, would raise $394 billion over 10 years, Thomas J. Donohue, president and CEO of the 3-million-member U.S. Chamber, said at a one-day infrastructure summit in Washington.
Donohue said the organization's members, who compose the largest business trade group in the country, would not be opposed to a one-time, up-front hike of 25 cents a gallon as an alternative to the phased-in approach. The Chamber is talking to the White House and Congress about broad infrastructure issues, and Donohue's comments today are designed to start a national conversation about the issue, said a source inside the Chamber. "We're ready to work with anyone to get this done," the source said.
The federal motor fuels tax, which stands at 24.4 cents a gallon for diesel and 18.4 cents a gallon for gasoline, has not been raised since 1993. Proceeds from the levies are deposited in a trust fund, which is the dominant revenue source for federal road projects. For several reasons, not the least of which has been that the steadily rising cost of road projects has exceeded the money available to pay for them, Congress has repeatedly been forced to inject funds from the general treasury into the Highway Trust Fund to keep it solvent.
Sean McNally, a spokesman for the trade group American Trucking Associations (ATA), said in an e-mail that "in general, we are supportive of finding fair and efficient ways of raising revenue for infrastructure investment." ATA, which has long supported an increase in the motor fuels tax, has proposed a 20-cent-per-gallon fee that would be collected at the wholesale level, when the product is pumped into the bellies of service station tanks.
For years, stakeholders across a broad spectrum have advocated increasing the federal levy, provided the funds are dedicated to road infrastructure improvements. However, the administrations of presidents George W. Bush, Barack Obama, and, for the first year at least, Donald J. Trump, have refused to push for a fuel tax increase.
Congress, for its part, has also failed to act, worrying about the political ramifications of such a move come election time. However, Donohue noted today that 39 states have raised their fuel taxes since 1993—with some states doing so several times during that period—and that no state lawmaker has lost an election because he or she advocated a fuel tax increase.
The lack of political support for a federal fuel tax hike stems from Congress' desire to move away from the original user-fee model to one that funds a broad range of transport projects that make the motoring public feel their money is being wasted, said Robert Poole, director of transportation policy for the libertarian think tank The Reason Foundation.
"The voting public has little confidence that paying more to the feds will make any meaningful improvement in their travels," Poole said today in an e-mail. "By contrast, a majority of state DOTs [departments of transportation] have been able to gain political support for fuel tax increases by showing voters a direct connection between what they will pay and what more they will get if the increase is approved."
The Chamber's proposal comes as the Trump administration is focusing attention on a supposed $1 trillion infrastructure measure, the broad strokes of which would leverage $200 billion in federal funding to generate an additional $800 billion in federal, state, and private sector investment.
In his remarks, Donohue said private-public sector partnerships, while not appropriate in some cases, should still be strongly considered if the circumstances warrant. He pointed to a $1.91 billion project underway in Orange County, Calif., to add a general-purpose lane and a toll lane along a 16-mile stretch of Interstate 405, which feeds into the ports of Los Angeles and Long Beach, the country's busiest seaport complex. The county has received a $628 million loan from the U.S. Department of Transportation, and will finance most of the remainder by issuing bonds backed by toll revenues. Most of the work is set for completion in 2023.
"These are the kinds of things we should be doing all across the country," Donohue said. "Depending on the design of the financing mechanism, just $1 of federal funds today can, by some estimates, leverage up to $40 for new infrastructure projects."
Supply chain planning (SCP) leaders working on transformation efforts are focused on two major high-impact technology trends, including composite AI and supply chain data governance, according to a study from Gartner, Inc.
"SCP leaders are in the process of developing transformation roadmaps that will prioritize delivering on advanced decision intelligence and automated decision making," Eva Dawkins, Director Analyst in Gartner’s Supply Chain practice, said in a release. "Composite AI, which is the combined application of different AI techniques to improve learning efficiency, will drive the optimization and automation of many planning activities at scale, while supply chain data governance is the foundational key for digital transformation.”
Their pursuit of those roadmaps is often complicated by frequent disruptions and the rapid pace of technological innovation. But Gartner says those leaders can accelerate the realized value of technology investments by facilitating a shift from IT-led to business-led digital leadership, with SCP leaders taking ownership of multidisciplinary teams to advance business operations, channels and products.
“A sound data governance strategy supports advanced technologies, such as composite AI, while also facilitating collaboration throughout the supply chain technology ecosystem,” said Dawkins. “Without attention to data governance, SCP leaders will likely struggle to achieve their expected ROI on key technology investments.”
The British logistics robot vendor Dexory this week said it has raised $80 million in venture funding to support an expansion of its artificial intelligence (AI) powered features, grow its global team, and accelerate the deployment of its autonomous robots.
A “significant focus” continues to be on expanding across the U.S. market, where Dexory is live with customers in seven states and last month opened a U.S. headquarters in Nashville. The Series B will also enhance development and production facilities at its UK headquarters, the firm said.
The “series B” funding round was led by DTCP, with participation from Latitude Ventures, Wave-X and Bootstrap Europe, along with existing investors Atomico, Lakestar, Capnamic, and several angels from the logistics industry. With the close of the round, Dexory has now raised $120 million over the past three years.
Dexory says its product, DexoryView, provides real-time visibility across warehouses of any size through its autonomous mobile robots and AI. The rolling bots use sensor and image data and continuous data collection to perform rapid warehouse scans and create digital twins of warehouse spaces, allowing for optimized performance and future scenario simulations.
Originally announced in September, the move will allow Deutsche Bahn to “fully focus on restructuring the rail infrastructure in Germany and providing climate-friendly passenger and freight transport operations in Germany and Europe,” Werner Gatzer, Chairman of the DB Supervisory Board, said in a release.
For its purchase price, DSV gains an organization with around 72,700 employees at over 1,850 locations. The new owner says it plans to investment around one billion euros in coming years to promote additional growth in German operations. Together, DSV and Schenker will have a combined workforce of approximately 147,000 employees in more than 90 countries, earning pro forma revenue of approximately $43.3 billion (based on 2023 numbers), DSV said.
After removing that unit, Deutsche Bahn retains its core business called the “Systemverbund Bahn,” which includes passenger transport activities in Germany, rail freight activities, operational service units, and railroad infrastructure companies. The DB Group, headquartered in Berlin, employs around 340,000 people.
“We have set clear goals to structurally modernize Deutsche Bahn in the areas of infrastructure, operations and profitability and focus on the core business. The proceeds from the sale will significantly reduce DB’s debt and thus make an important contribution to the financial stability of the DB Group. At the same time, DB Schenker will gain a strong strategic owner in DSV,” Deutsche Bahn CEO Richard Lutz said in a release.
Transportation industry veteran Anne Reinke will become president & CEO of trade group the Intermodal Association of North America (IANA) at the end of the year, stepping into the position from her previous post leading third party logistics (3PL) trade group the Transportation Intermediaries Association (TIA), both organizations said today.
Meanwhile, TIA today announced that insider Christopher Burroughs would fill Reinke’s shoes as president & CEO. Burroughs has been with TIA for 13 years, most recently as its vice president of Government Affairs for the past six years, during which time he oversaw all legislative and regulatory efforts before Congress and the federal agencies.
Before her four years leading TIA, Reinke spent two years as Deputy Assistant Secretary with the U.S. Department of Transportation and 16 years with CSX Corporation.
Serious inland flooding and widespread power outages are likely to sweep across Florida and other Southeast states in coming days with the arrival of Hurricane Helene, which is now predicted to make landfall Thursday evening along Florida’s northwest coast as a major hurricane, according to the National Oceanic and Atmospheric Administration (NOAA).
While the most catastrophic landfall impact is expected in the sparsely-population Big Bend area of Florida, it’s not only sea-front cities that are at risk. Since Helene is an “unusually large storm,” its flooding, rainfall, and high winds won’t be limited only to the Gulf Coast, but are expected to travel hundreds of miles inland, the weather service said. Heavy rainfall is expected to begin in the region even before the storm comes ashore, and the wet conditions will continue to move northward into the southern Appalachians region through Friday, dumping storm total rainfall amounts of up to 18 inches. Specifically, the major flood risk includes the urban areas around Tallahassee, metro Atlanta, and western North Carolina.
In addition to its human toll, the storm could exert serious business impacts, according to the supply chain mapping and monitoring firm Resilinc. Those will be largely triggered by significant flooding, which could halt oil operations, force mandatory evacuations, restrict ports, and disrupt air traffic.
While the storm’s track is currently forecast to miss the critical ports of Miami and New Orleans, it could still hurt operations throughout the Southeast agricultural belt, which produces products like soybeans, cotton, peanuts, corn, and tobacco, according to Everstream Analytics.
That widespread footprint could also hinder supply chain and logistics flows along stretches of interstate highways I-10 and I-75 and on regional rail lines operated by Norfolk Southern and CSX. And Hurricane Helene could also likely impact business operations by unleashing power outages, deep flooding, and wind damage in northern Florida portions of Georgia, Everstream Analytics said.
Before the storm had even touched Florida soil, recovery efforts were already being launched by humanitarian aid group the American Logistics Aid Network (ALAN). In a statement on Wednesday, the group said it is urging residents in the storm's path across the Southeast to heed evacuation notices and safety advisories, and reminding members of the logistics community that their post-storm help could be needed soon. The group will continue to update its Disaster Micro-Site with Hurricane Helene resources and with requests for donated logistics assistance, most of which will start arriving within 24 to 72 hours after the storm’s initial landfall, ALAN said.