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 United States and Mexico today announced a tentative resolution of a cross-border trucking dispute that has cost U.S. exporters millions of dollars in business and created significant ill will between the two countries.
The agreement, announced in a joint statement by President Barack Obama and Mexican President Felipe Calderon, establishes what the countries call a "reciprocal, phased-in program" to allow U.S. and Mexican carriers to operate on both sides of the border. In return, Mexico, which two years ago began imposing tariffs on 89 U.S. imports in retaliation for its carriers being denied access to U.S. markets, will reduce those tariffs by 50 percent at the time a final agreement is signed and suspend the remaining 50 percent when the first Mexican carrier is granted operating authority under the program, according to the statement. Mexico will terminate all current tariffs once the program is "normalized," the statement said.
U.S. and Mexican negotiators expect to soon complete work on a final agreement, which will then be presented to Congress and put out for public comment in the United States. Transportation Secretary Ray LaHood and U.S. Trade Representative Ron Kirk, both of whom were involved in negotiating the deal, have said they expect a final agreement by mid-year.
The agreement maintains previous conditions for Mexican trucks operating on U.S. highways, among them the requirement that Mexican fleets apply for and receive authority from the Federal Motor Carrier Safety Administration and demonstrate they meet the same safety standards as U.S. fleets. In addition, Mexican trucks will be prohibited from hauling freight between destinations within the United States.
Stopping the "carousel"
In early January, the U.S. Department of Transportation circulated what it termed a "concept document" that would enable Mexican trucks to operate in U.S. commerce beyond a 25-mile border "commercial zone." The proposal came nearly two years after President Obama signed an omnibus spending bill that ended funding for a 2007 pilot program that gave Mexican truckers and drivers limited access to U.S. markets.
Supporters of the president's 2009 action, namely the Teamsters union and independent truck drivers, had hailed it as an important step in keeping unsafe and unqualified Mexican truckers off U.S. highways. Critics said the administration's decision violated a provision in the 1994 North American Free Trade Agreement that required the United States to grant Mexican truckers full access to its highways by January 2000.
The tariffs imposed by the Mexican government affected U.S. imports valued at about $2.4 billion a year. Mexico imposed the tariffs using a rotating "carousel" mechanism that lets it remove some products from the list while adding others.
At a transport industry gathering in early January, LaHood said the tariffs have had a "huge impact"" on U.S. producers and growers, which consider Mexico one of their largest export markets, if not the largest. His comments have echoed those of the U.S. Chamber of Commerce and of congressmen representing key growing states whose companies sell heavily into Mexico.
Following the release of the DOT document, Mexico said it would stop the "carousel" and refrain from adding any more products to the list.
Mixed reaction
The American Trucking Associations (ATA), which represents the nation's largest for-hire carriers, applauded today's move.
"We hope this agreement will be a first step to increasing trade between our two countries, more than 70 percent of which crosses the border by truck," said ATA President Bill P. Graves in a statement.
The Owner-Operator Independent Drivers Association (OOIDA), which represents small, owner-operator truck fleets and which has long opposed efforts to open the U.S. market to Mexican truckers, expressed outrage.
"Simply unbelievable," said Todd Spencer, executive vice president of OOIDA, in an announcement. "For all the president's talk of helping small businesses survive, his administration is sure doing [its] best to destroy small trucking companies and the drivers they employ."
Spencer added: "Small business truckers are in the midst of dealing with an avalanche of regulatory rulemakings from the administration. They are also struggling to survive in a very difficult economy. This announcement is tantamount to rubbing salt in wounds already inflicted."
The Teamsters union, which also opposes the measure, had not issued a comment at press time. At the time of the DOT's original draft document, Teamsters President James P. Hoffa warned that, if approved, the proposal would endanger the U.S. traveling public and expose the U.S. southern border to increased drug trafficking from Mexican cartels.
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.