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.
Will 83 cents move the needle for more than a quarter of a million UPS Teamsters?
That is the annualized hourly wage increase, spread out over 5 years, that full-time unionized UPS workers would receive if Teamster members ratify a tentative contract agreed to last Thursday by the company and union leaders. The proposal calls for full-time hourly wages to rise by $4.15 an hour over the life of the contract, which would take effect Aug. 1 and run through the end of July 2023. Full-timers would thus receive an 83 cents-an-hour wage hike on each contract anniversary date.
For UPS full-timers, the proposed language works out to a 2.2 percent annualized wage hike, increases that Ken Paff, national organizer and chief spokesman of the dissident group Teamsters for a Democratic Union (TDU), are the smallest he can remember ever being agreed to.
By the end of the contract period, wages of UPS full-timers would reach about $40 an hour, according to TDU calculations. TDU, which is typically at odds with Teamster leadership, is taking a skeptical view of the compact's merits. The Teamsters represent 256,000 UPS small-package employees and another 11,000 at the company's UPS Freight less-than-truckload (LTL) unit. Talks are continuing to hammer out a separate contract covering LTL workers.
Atlanta-based UPS has always faced labor cost headwinds because of its unionized status. Its main rival, Memphis-based FedEx Corp., uses independent, non-union contractors for its ground parcel delivery operations. In recent years, however, pressures to drive down costs have intensified as providers that offer ostensibly free shipping to their customers look to shave delivery expenses. This was not mainstream thinking in 2013, the last year UPS and the Teamsters negotiated a contract.
The two sides will meet July 9-12 in Minneapolis to continue the LTL talks and to finalize the local parcel supplements and riders that remain unresolved and must eventually be approved before the national, or "master," contract goes into effect. Once the local agreements are hammered out, two-person committees at each local will review the proposed master contract. It will then be sent to the rank and file for a ratification vote. A rank-and-file vote, which for the first time in the history of UPS-Teamster contracts will be conducted electronically, will likely not be held until August.
The tentative agreement establishes a classification of a full-time "combination driver" who will receive $20.50 an hour as a starting wage and max out at $34.79 an hour by Aug. 1, 2022. It also calls for UPS, one of the largest users of intermodal services operated by the railroads, to shift a significant amount of volume from intermodal to an expanded network of two-person sleeper team drivers. The Teamsters said that the shift will create about 2,000 full-time team drivers, and that UPS team drivers will make more than any other commercial driver. Denis Taylor, head of the Teamsters' package division, called the proposal one of the best contracts ever negotiated for UPS workers.
Sleeper teams are in strong demand as heightened delivery requirements compel fleets to keep the wheels constantly turning. Sleepers, which allow one driver to operate while the other sleeps, is seen as a way to offset the impact of the recent federal Electronic Logging Device (ELD) mandate, which requires drivers to strictly follow the federal Hours of Service guidelines and which would shut a solo driver down after 11 hours behind the wheel.
Earlier this month, Central Oregon Truck Co., a Redmond, Ore.-based flatbed carrier that has typically paid its solo drivers at the high end of the wage scale, launched a team driver pay program that will pay combined annual wages of between $122,000 and $173,000. Central Oregon has slightly more than 300 trucks.
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.