Commentary

Commentary

At the beginning of any new year it seems the standard theme for most business articles is one of predictions, and this year has been no different. I enjoy reading these articles as an opportunity to catch a glimpse of that next thing that has the ability to be a true game changer.
When UPS on Jan. 23 pre-announced fourth-quarter earnings, it shouldn’t have been a surprise. Yet some analysts said they were “troubled by the company’s inability to get peak (operating expenses) right during what is increasingly becoming the most important quarter of the year” and were concerned “that UPS got the service but not the cost, which is going to leave the market wondering if it can only have one or the other.”
The Queen of the Skies is fading away. The Boeing 747, the original widebody jet that has, according to Air and Space Smithsonian Magazine, “transported the equivalent of 80 percent of the human race” over the years, is being taken out of service far faster than industry observers had expected. The 747 is being supplanted by smaller but highly fuel-efficient twin-engine aircraft such as the 787 and the new Airbus A350 XWB (Extra Wide Body). Is there a message in all this for other freight sectors? Is bigger, in fact, always better?
After a load was delivered short, and a proof of delivery late, does the carrier have any blame and financial responsibility for make things right?
Reading the JOC 2015 Annual Review and Outlook, I’m reminded of the continuation of the conflicts between service providers and customers, and question some of the logic in these conflicts.
Among the many topics covered in this year’s State of the Union Address, President Obama discussed two issues that are critical for the continued growth of the U.S. economy — international trade and transportation infrastructure. Both are priorities the retail industry strongly supports.
If you missed what Moffatt & Nichol economist Walter Kemmsies told the SMC3 Jumpstart Conference in January, his words bear repeating. As reported by JOC Group Senior Editor Bill Cassidy, Kemmsies said the biggest threat to global trade isn’t protectionism, war, terrorism, disease or natural disaster. Instead, it’s mounting congestion at ports around the world, a phenomenon that’s been building for years and burst out into the open in 2014.
Congress should pass a new Miscellaneous Tariff Bill in 2015. But lawmakers should also consider sensible enhancements to the Foreign-Trade Zones program, including full funding of Customs automation, expanding direct delivery to speed shipments from ports to zones, and revising the FTZ Act to put companies and workers in U.S. zones on a more equal footing with their competitors in free trade agreement partner countries.
Let’s call 2015 the year of cautious optimism for U.S. ports. What will it bring?
A 3PL says it sometimes prints one or two “original” trucking bills of lading for drivers to sign for receipt. Is it doing the right thing? Or can this create potential problems later?
The honeymoon in the wake of the Federal Mediation and Conciliation Service assuming control of the West Coast talks between the International Longshore and Warehouse Union and its employers lasted less than a week. If anything, the negotiations have reached a nadir since mediators joined the fray, with both sides engaging in a war of words that has busted wide open a mutual pledge the two sides made when this process began last May not to discuss details of the negotiations.
President Obama once again called for dramatically improving U.S. infrastructure and receiving expanded powers to finalize two major trade pacts during last night’s State of the Union address.
Being compliant with trade regulations among various federal departments goes a long way to getting your company where it needs to end up in order for costs to be consistent and predictable.
What will 2015 look like for an industry that has had four consecutive underperforming years? There are many issues to deal with, but let’s focus on the few that mean the most. At the top of the list is the lack of profitability among ocean carriers and West Coast labor and congestion issues that I don’t see clearing up any time soon.