Point Global Logistics News of the Week 9.30.22

American Logistics Aid Network gets activated for Hurricane Ian
As Hurricane Ian intensifies, the American Logistics Aid Network (ALAN) is urging Florida and Gulf Coast residents to prepare—and asking members of the logistics community who aren’t located near the storm’s path to be ready to help.

“Over the next few days Hurricane Ian has the potential to deliver high winds, strong rains and a significant storm surge across many parts of Florida,” said Kathy Fulton, ALAN’s Executive Director. “We are mobilizing accordingly.”

Source: Logistics Management

August intermodal volumes trend up, reports IANA
Intermodal volumes, for the month of August, were largely up, following mostly across-the-board declines in July, according to data provided to LM by the Intermodal Association of North America.

Total August volume—at 1,581,860—increased 2.0% annually.

Trailers—at 72,223—saw another significant decline, down 25.6%, an improvement over July’s 29.0% annual decline, for the lone segment tracked by IANA to fall. Domestic containers—at 698,252—increased 4.7% annually. All domestic equipment, which is comprised of trailers and domestic containers, eked out a 0.9% gain, to 770,475. ISO, or international, containers—at 811,385—headed up 3.%.

Source: Logistics Management

Port of Liverpool community braces for second dockworker strike

Liverpool dockworkers are to stage a second walkout, from 11-17 October, after negotiations with the Peel Ports-operated terminal failed.

The Unite union announced the next strike with five days left of the current industrial action, saying an offer of an 8.3% pay rise and one-off £750 payment fell well short of the present 12.3% rate of inflation, which is forecast to continue rising.

However, One forwarder seemed unphased by the news and told The Loadstar the strikes at Liverpool and Felixstowe had had “a muted impact” on their business.

Source: TheLoadStar

Meet our Dominican Republic Team

Meet our Dominican Republic Team

This month, we are featuring two of our employees from our Dominican Republic team, Oliver Cruz and Ysangel Ogando.

To start, let’s hear more about Oliver, our Logistics Analyst. He started working at Point Global Logistics in January and his daily tasks include tracking cargo, updating information in the system, and other tasks such as creating a CNS report and enhancing our database.

His role at PGL has taught him to listen to professionals with more experience to help him improve both as a person and as an employee.  

Prior to joining the team at PGL, Oliver studied International Business at UNAPEC. Oliver started his logistics career at Tropical Shipping where he learned a lot about global logistics and how to work with carriers. Now, he continues to educate himself further by taking courses in logistics and supply chain management. 

In his free time, he enjoys going to the gym and hanging out with his friends. He has two pets: one chihuahua, Doki, and a kitten, Lissi.

Now let’s turn to our Logistics Specialist, Ysangel, who started with us in October 2021. Ysangel stays busy keeping up with emails and tracking bookings in order to update them and keep the office and clients updated. For clients, she coordinates the operation process from quoting until the cargo is shipped out. With what time she haves left at the end of the day, she completes billing and keeps organized by making a list of anything she needs to follow up on the next day, such as a request for the shipping lines or shipping instructions. 

Prior to working at PGL, Ysangel started at a local bank before moving into the logistics field at two local freight forwarding companies. Along with work, she is also continuing her education at UNAPEC through a double degree program at SUNY Empire State College (ESC) where she is studying to obtain a B.S. in Business, Management, and Economics with a concentration in Economics.

Her favorite part of the job is that “there is always something new to do and something new to learn.” In her career, she has learned that studying and working at the same time is worth it.

Ysangel plays volleyball every weekend and in her free time she watches movies, reads books, or hangs out with her boyfriend and friends.   

Thank you, Ysangel and Oliver, for telling us more about yourselves and your careers. We appreciate your hard work and look forward to seeing you progress in your career here at Point Global Logistics!

Employee Spotlight: Will Yazigi

Will Yazigi

Say hello to our Charlotte, NC Branch Manager, Will Yazigi. Will is originally from Lebanon and immigrated to the U.S. in 2007. He started working at Point Global Logistics in July of 2020.

Will started his career in international transportation in Lebanon and worked as an expatriate in Saudi Arabia and Hong Kong before relocating to the United States.

He begins each day by meeting with his team, reviewing existing business, and assisting with tasks as necessary. Then, he reaches out to customers to address any challenges they may have and provides updates on current market conditions. Lastly, he reviews the commercial side of the business to make sure the company is competitive and meeting milestones. 

Working closely with his colleagues and customers to develop solutions that improve customers’ end-to-end supply chain is his favorite part of the job. 

Will enjoys hobbies such as spending quality time with his wife and 11-year-old twin sons and outdoor activities like mountain biking, hiking, and snowboarding. In addition to his human family, Will also has a two-year-old Aussie Doodle puppy that grew to be 60 lbs that keeps his family very busy. They also have adopted a one-year-old ragdoll cat that is very talkative.

His dream place he’d like to visit is Tibet. His favorite type of food to eat is Mediterranean cuisine. 

His best career advice? “Learn a new thing every day and be flexible and adapt quickly to industry changes as change is the only constant.”

Thanks, Will for sharing a little more about yourself and for being such a valuable member of our team!

The Key to the Long Expansion? Logistics

“You can’t recommend those stocks,” a Wall Street strategist insisted in 1986. “We’re in the third year of a four-year expansion. They won’t work.” Being naive, I did it anyway. The expansion lasted a total of almost eight years, until July 1990. Strategists don’t know much, but to be fair, it was a B-school accepted truth that expansions last four years. Another expansion began in 1991 and lasted a record 10 years. And this month we broke that record. Since June 2009, the U.S. economy has kept growing. Every day is another record.

Did you ever wonder why we are enjoying a decadelong run? What changed? Everyone wants credit. Was it the Federal Reserve and its relentless stimulus? Nope. The Fed creates the money the economy needs, but not the need itself. Obama or Trump policies? A divided Congress? Demographic shifts? A strong or weak dollar? Actually, none of the above. The answer is just-in-time. You can thank all those freshly minted consultants you see in premium economy crisscrossing the country with their AirPods and Allbirds and airy attitudes.

In the previous era, before pervasive computing, economies would live and die by inventory cycles. Heck, biblical times record seven years of feast and seven of famine. The expansion starts, consumers buy, investment and hiring ramp up, wages and prices rise, inflation emerges, consumers buy ahead of price increases, investment peaks, inventories build, consumers are tapped out, recession starts, inventories are drawn down, and layoffs begin—then start all over every four years. Until recently, price signals didn’t travel very fast, and inventory tracking used clipboards.

In a micro version of this cycle, the videogame industry had a huge bonanza in the early 1980s that ended in ’83 with bust of the highly anticipated “E.T. the Extra-Terrestrial” game. Warner Communications literally buried about 700,000 unsold cartridges of “E.T.” and other titles, and lost more than $500 million. The semiconductor industry got stuck with loads of chips in inventory that had to be written down. It was ugly. After a similar inventory mess related to then-newfangled personal computers, the tech world started implementing just-in-time delivery. Companies like Compaq would ask for chips to be delivered Tuesday for PCs shipped on Wednesday. This gradually smoothed out the cycles of a very volatile industry.

Thirty-six years later, much of the global economy has perfected this just-in-time supply chain. Digital cash registers and bar codes log consumer purchases. Logistics software allows manufacturers to track every production detail everywhere on the globe. Data is fed into giant databases that forecast demand. Manufacturing, transportation and retail are a highly choreographed water ballet of delivering inventory right before it’s needed. Exactly the right amount of toothpaste is magically dropped onto Walmart shelves each night.

Software is now a mind-bending cornucopia of supply-chain management, enterprise-resource planning, business-process re-engineering and decision-support systems—all of which barely existed 30 years ago. But here’s the dirty little secret: Enterprise software from Oracle and SAP and just about everyone else is notoriously hard to use, nasty to implement, and a royal pain to maintain. That means a virtual Full Employment Act for consultants—tens of thousands are hired yearly by PwC, Deloitte, KPMG, Ernst & Young—add BCG and McKinsey too—to customize and implement business processes.

I have to admit my eyes usually glaze over with images of paint drying when I hear these companies’ names. But consulting is booming. Deloitte consulting has grown by double digits in each of the past 10 years. Consulting is now a $130 billion global business. Of that, digital-technology consulting makes up some $50 billion. This software has become the lubricant for economic gears, preventing inventory from gumming up the works. “Consultants” are mislabeled—most are more like implementers, but that doesn’t look as good on a résumé.

Price signals move around the globe in nanoseconds instead of months and squash excesses before they happen. Analytics are also improving—and the field is heating up, as shown by the recent sales of Looker and Tableau. Next, we’ll see machine learning find patterns to squeeze out even more efficiency, putting goods in the right place at the right time. Productivity tools have stretched expansions beyond anyone’s belief and have expanded wealth the world over—see value created at public Salesforce and private Vista Equity Partners.

Have we forever tamed the cycle? Nah, because like white tigers in Las Vegas, outside events can still bite and maul economic growth—oil embargoes, terrorism, tariffs, wars, no-doc home loans, maybe leveraged loans next. The current expansion may have already ended for all we know, stabbed in the back by tariff daggers. But I don’t think so—this could go on for a while. Thank those airline-mile-accumulating consultants. Give ’em your unwanted peanuts. They know how to track them.

Logistics Spending Jumped 11.4% on Strong Economic Growth

U.S. businesses spent $1.64 trillion on transportation and warehousing costs last year, with demand slowing in 2019

By Jennifer Smith
June 18, 2019 9:00 am ET
Rising logistics costs consumed a bigger share of U.S. corporate spending over the past year as companies rushed to take advantage of an improving U.S. economy, according to a new report.

Spending on transportation, inventory-carrying costs and other shipping-related expenses as a share of gross domestic product last year reached its highest level since 2014, the Council of Supply Chain Management Professionals said in its annual State of Logistics Report, a surge the report said is cooling this year on more plentiful capacity and moderating shipping demand.

U.S. businesses spent a record $1.64 trillion on logistics in 2018, up 11.4% from the prior year and accounting for 8% of GDP, the report said. Industry experts view the logistics share of GDP as a measure of the efficiency of transportation and distribution networks, and last year’s figure was sharply up from a 7.5% share in 2017.

With economic growth expected to slow in the second half of 2019, companies that built up inventories ahead of expected tariffs could pull back their demand for logistics services this year, “easing the price increases that bedeviled shippers” during last year’s sizzling freight market, the report said. “This is good news for shippers, but carriers will struggle as volumes fall.”

Logistics costs should still rise in 2019, though not as abruptly as last year, when booming demand and tight capacity strained supply-chain budgets and sent shippers scrambling to book transportation, said Michael Zimmerman, a partner at consulting firm A.T. Kearney Inc. and the lead author of the report.

Trucking rates “will come down but not as dramatically as they have in the past,” Mr. Zimmerman said, while costs tied to warehousing and labor continue to rise. A.T. Kearney forecasts contract pricing for over-the-road truck shipments will decline by between 3% and 5% in 2019.

U.S.-China trade tensions are a wild card that could weigh on shipping demand in 2019. Retailers, manufacturers and wholesalers pulled shipments forward in late 2018 in anticipation of rising levies on Chinese imports. That jammed warehouses and strained logistics capacity around major U.S. trans-Pacific gateways.

Storage and other inventory costs jumped 14.8% in 2018 as inventories measured by value increased 4.6% compared with the prior year, the report said.

Commerce Department figures suggest that inventories may be getting ahead of demand, with the inventory-to-sales ratio for all U.S. businesses hovering around 1.39 this spring, after falling to a three-year low of 1.34 in May and June of 2018.

Accelerating tariffs may have contributed to softer-than-usual demand this spring for Omaha, Neb.-based trucking company Werner Enterprises Inc., whose retail customers account for 52% of revenue, Chief Financial Officer John Steele said at a June 5 industrial conference in Chicago.

“It appears that several [retail customers] grew their inventories in that February-to-March time period,” which could have led to destocking in April and May, Mr. Steele said. A number of retailers notched same-store sales improvement from February to April, “so hopefully that will translate into better freight volumes for our retail customer base going forward,” he said.

Lee Clair, a managing partner at Transportation and Logistics Advisors LLC, a supply-chain-strategy consulting firm, said freight demand this year has “moderated into something below where we were last year, but it’s higher than anything that existed before that…There’s no way it could continue to boom the way it was.”

Overall transportation spending increased 10.4% overall in 2018, with spending on intermodal truck-rail transport soaring 28.7%.

Write to Jennifer Smith at jennifer.smith@wsj.com

IMO 2020: The Big Shipping Shake-Up

FedEx, UPS Strive to Automate Loading and Unloading Trucks

Remote Diagnostics to the Rescue

Systems Help Fleets Reduce Vehicle Downtime, Prevent Costly Repairs, Experts Say
Navistar's OnCommand Connection remote diagnostics systemNavistar’s OnCommand Connection remote diagnostics system. (Navistar)

Remote diagnostics systems available on modern trucks are helping fleets avoid costly repairs and reduce vehicle downtime, and this technology is rapidly advancing toward offering better predictions of when problems might occur.

Tom Howard, fleet director for San Francisco-­based Veritable Vegetable, said his fleet doesn’t have much flexibility delivering its time-sensitive organic produce. For a while, it seemed every weekend he was answering a call from a driver reporting a check engine light. With limited information, he then would decide whether to drive to a potentially expensive outside shop or return it to company headquarters. It might be a major problem, or it might be a faulty sensor.

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Read more feature stories from our second-quarter issue of Equipment & Maintenance Update:

In January 2016, the company began using Kenworth’s “TruckTech+” on 11 of its 28 trucks. For those, he receives an e-mail telling him what the light is signaling and suggesting what to check. On the manufacturer’s website, he can see the truck’s fault code history, helping him determine if it’s a one-time problem or part of a trend. The system also provides the locations of the three closest repair facilities.

“Consequently, I haven’t had to roll a truck into a shop, on the ones with TruckTech+, except for once because I didn’t understand what the problem was,” Howard said. It was a software issue.

Veritable Vegetable truck

Veritable Vegetable uses Kenworth’s “TruckTech+” system. (Veritable Vegetable)

At P.A.M. Transport, which operates about 2,000 trucks, the company has reaped the benefits since becoming more proactive with remote diagnostics in recent months, said Paul Pettit, vice president of maintenance.

Previously, the company used fault codes mostly to triage driver road calls. When a check engine light would appear, the driver would be asked to pull the codes himself, which some had trouble doing. Or, drivers wouldn’t contact the company when a light appeared, and the first time the company learned anything was wrong was when the driver called to say the truck had been derated and had slowed to 5 mph.

The company has identified one individual who monitors all incoming telematics from the fleet’s Peterbilt, Freightliner and Navistar models. That information is used to route drivers and ensure dispatchers don’t assign loads to trucks that need service. If necessary, another power unit can be prepared to service the customer.

Not only can the fleet learn what’s wrong, but also how long it’s been happening, the recommended repair, and, in some cases, what nearby shops have the needed parts.

“Pretty much if anything is breaking down right now, we know it when it’s happening or before it happens,” Pettit said.

Tontitown, Ark.-based P.A.M. Transport ranks No. 71 on the Transport Topics Top 100 list of for-hire carriers in North America.

Other fleets also have benefited from remote diagnostics.

Reyes Holdings, a private fleet with more than 4,000 tractors, started using Navistar’s OnCommand Connection in 2016. Annelies Van Thillo, operations analyst, said within a week of rolling out the product, a technician identified two trucks with low diesel exhaust fluid and another with a required regeneration.

At Maryland-based D.M. Bowman, Chief Operating Officer Brian Hall said the 380-tractor truckload carrier saves six to seven hours in downtime per truck per quarter, or about $80 per hour per truck, with the remote diagnostics system his company uses.

Fleets always have operated reactively and still do, according to Kenneth Calhoun, fleet optimization manager for Birmingham, Ala.-based Altec Industries. The difference is that with remote diagnostics, they can shorten that reaction time, he said.

Calhoun, who also is general chairman of American Trucking Associations’ Technology & Maintenance Council, said that while a significant percentage of trucks have the technology installed, fleet adoption varies. Fleets that are progressive elsewhere, such as with electronic logging devices, tend to be the most progressive with remote technology as well. Vocational applications have trailed the rest of the industry, he said.

Providers still are learning what the payment model will look like, Calhoun said. Generally, the service is free for a certain amount of time, and then fleets can subscribe.

Fleets can be overwhelmed by the data, so they must prioritize the information and look for trends, Calhoun said. If a particular group of faults is spiking, the fleet should find the root cause. Fleets should consider a truck’s year model, engine, where it’s domiciled and who is maintaining it. The biggest wins involve finding a problem in groups of vehicles, leading to changes in preventive maintenance, he said.

Looking ahead, Calhoun predicted that in the next 10 years, a vehicle will understand its own issues and then adjust its operating characteristics, allowing the driver to travel to a preferred destination for repairs and updates.

“I think that in our lifetimes, we’ll see the vehicles, for lack of a better way to put it, become self-aware, and then begin to mitigate those situations to extend its life and to optimize the availability of the asset,” he said.

Chris Morrow, fleet management customer service specialist for Entergy, an electric utility, said that because the volume of information can be so overwhelming, fleets should start by focusing on critical codes. Technicians will embrace the technology after seeing it prevent catastrophic failures.

Morrow said Entergy’s main focus has been on its 1,200 medium-duty hydraulic trucks, mostly Freightliners and all with Cummins engines. Following Calhoun’s advice, the fleet focused on those critical codes such as high engine temperatures and low coolant levels.

“That turned out to be fantastic,” he said. “We got those results that we hoped for. Our technicians bought into it, and then twofold, it did end up having a huge financial return for us because those critical codes were just that critical, and they did lead to many of our engine failures.”

Morrow estimates the fleet is saving $250,000 to $300,000 annually avoiding catastrophic engine failures. Remote diagnostics provides information that drivers sometimes didn’t provide. Sometimes the check engine light warned of problems, but the driver would be working in an aerial and didn’t see it.

Remote diagnostics technology is expanding.

Andrew Dondlinger, vice president and general manager for connected services at Navistar, said OnCommand Connection was developed initially to collect and display diagnostic codes. Now, fault code action plans help fleets validate if something is an issue and determine a course of action. Live fault code action plans, which launched about a year ago, show the needed part number, nearby dealers with the part available and standard repair time.

Other engine manufacturers also are providing remote diagnostics systems.

Dheepak Rajannan, product manager for Cummins’ electronic service tools and information business, said the company’s Guidanz system helps fleets and service providers diagnose and respond to problems. The mobile app includes an immediate assessment feature that helps users understand the issue.

Service providers can use immediate assessment to start a work order in Guidanz Web, a guided service event workflow system that automatically transfers information, such as engine specs and the VIN number. The driver can use the application to find the closest certified service location and e-mail the truck’s GPS location and fault code information. Cummins plans to offer different tiers of packages so even owner-operators can obtain support.

Detroit Connect Virtual Technician

A driver accesses information from the Detroit Connect Virtual Technician. (Daimler Trucks North America)

Jason Krajewski, director of truck connectivity for Daimler Trucks North America, said ­the Detroit Connect Virtual Technician quickly notifies fleets of a fault’s severity and whether the driver can resolve the issue. In critical situations, the Detroit customer support center receives engine data from 60 seconds before the fault event and 15 seconds after. Experts then notify the fleet about the cause, recommended parts, and nearest service locations with parts available. Technicians at the selected location receive a copy so they are prepared to address the issue.

Mack GuardDog Connect reduces diagnostic times by 70%, according to David Pardue, Mack’s vice president of connected vehicle and uptime services. Pardue pointed out that software updates can be done using Mack Over the Air programming.

Navistar’s Dondlinger said the technology is advancing to predictive diagnostics. For a per-­vehicle subscription fee, Navistar tells a fleet what units are at the highest risk for major problems, and then it works with them on their maintenance schedules. The manufacturer can spot patterns such as a periodically appearing low coolant indicator, which means the driver is simply refilling the coolant when a long-term fix is ­needed. Fleets can manage the influx of vehicles needing repairs and have bays available for vehicles predicted to have a problem.

The next step: prognostics, in which the manufacturer won’t even need the fault codes to know a serious problem could occur, Dondlinger said. It will use other information such as sensor codes, how the vehicle is being driven and its location.

“We aren’t yet at that point where we can say we have prognostics,” he said, “but … we have our feet firmly on the ground on the predictive diagnostics and are improving that daily through our interaction with our customers.”

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