Mitch Mac Donald has more than 30 years of experience in both the newspaper and magazine businesses. He has covered the logistics and supply chain fields since 1988. Twice named one of the Top 10 Business Journalists in the U.S., he has served in a multitude of editorial and publishing roles. The leading force behind the launch of Supply Chain Management Review, he was that brand's founding publisher and editorial director from 1997 to 2000. Additionally, he has served as news editor, chief editor, publisher and editorial director of Logistics Management, as well as publisher of Modern Materials Handling. Mitch is also the president and CEO of Agile Business Media, LLC, the parent company of DC VELOCITY and CSCMP's Supply Chain Quarterly.
Jim Oberstar's run ended 18 months ago. After 36 years of representing the Land of 10,000 Lakes on Capitol Hill, the Minnesota Democrat went down to defeat by Republican Chip Cravaack, a political novice, in the November 2010 mid-term elections.
His departure was lamented by colleagues on both side of the political aisle and by those with an interest in transportation policy. Widely recognized as one of the most transportation-savvy people to ever hold a seat in Congress, Oberstar served on the House Transportation and Infrastructure Committee for his entire tenure, including a stint as committee chairman from 2007 to 2011.
Earlier this month, Oberstar returned to Washington as a private citizen to address the Legislative Policy Forum hosted by the National Industrial Transportation League. During his 40-plus minute, largely off-the-cuff keynote address, the former congressman demonstrated an extraordinary grasp of the nation's transportation needs and challenges as well as their implications for America's economic future.
As an example of the problems we face, he pointed to the notorious rail bottleneck in Chicago. "Something is wrong," Oberstar said, "when it takes 36 hours and costs $300 to move a container from the West Coast to the west side of Chicago, another $300 and another 30 hours to move it to the east side of Chicago, and then $200 and 24 hours to move it from Chicago to the East Coast."
Something is indeed wrong, and it is not a metropolitan, or even a regional, problem. It is a national problem. A recent study estimated that as much as 25 percent of all rail freight in the United States moves through Chicago, and six of the country's seven largest railroads run through the city. The delays not only cause headaches, but also hinder the rail industry's ability to provide the kind of service its customers need to compete in a global economy.
As for why the Windy City has turned into the Chokepoint City, there are many reasons. Part of it's politics. Part of it's money—or as The New York Times recently put it, "a nation's general disinclination to improve its roads, bridges, and rails." And part of it is simply the result of a track system that's grown up since the 19th century with little coordination among the railroads and the city.
Will the situation ever change? Well, there is hope. In 2003, a consortium of private companies and local, state, and federal agencies launched a $3 billion partnership known as the CREATE (Chicago Region Environmental and Transportation Efficiency) Program. Its aim is to bring order to the chaos that is Chicago's rail system.
A daunting task, no doubt, but not impossible. Just weeks before Oberstar's address in Washington, folks in Southern California celebrated the 10th anniversary of the opening of the Alameda Freight Corridor, a mega-public works project of the 1990s that did for the Los Angeles area what Chicago so badly needs.
The Alameda Corridor consists of a series of bridges, underpasses, and overpasses designed to separate freight trains from street traffic and passenger trains. The project's centerpiece is the Mid-Corridor Trench, a below-ground rail line for freight trains that runs for 10 miles between Route 91 in Carson and 25th Street in Los Angeles.
Prior to the project's completion, trains on the four low-speed branch lines that were eventually consolidated onto the corridor had to cross more than 200 at-grade crossings and traveled at an average speed of 10 to 15 mph. It was common for motorists to wait 20 to 30 minutes for a 6,000-foot-long train to pass. The Alameda Corridor eliminated conflicts at those 200 crossings. Trains now zip through the corridor at an average speed of 40 mph.
Here's hoping that Chicago can replicate Southern California's success—and put its days as the Chokepoint City firmly behind it.
The number of container ships waiting outside U.S. East and Gulf Coast ports has swelled from just three vessels on Sunday to 54 on Thursday as a dockworker strike has swiftly halted bustling container traffic at some of the nation’s business facilities, according to analysis by Everstream Analytics.
As of Thursday morning, the two ports with the biggest traffic jams are Savannah (15 ships) and New York (14), followed by single-digit numbers at Mobile, Charleston, Houston, Philadelphia, Norfolk, Baltimore, and Miami, Everstream said.
The impact of that clogged flow of goods will depend on how long the strike lasts, analysts with Moody’s said. The firm’s Moody’s Analytics division estimates the strike will cause a daily hit to the U.S. economy of at least $500 million in the coming days. But that impact will jump to $2 billion per day if the strike persists for several weeks.
The immediate cost of the strike can be seen in rising surcharges and rerouting delays, which can be absorbed by most enterprise-scale companies but hit small and medium-sized businesses particularly hard, a report from Container xChange says.
“The timing of this strike is especially challenging as we are in our traditional peak season. While many pulled forward shipments earlier this year to mitigate risks, stockpiled inventories will only cushion businesses for so long. If the strike continues for an extended period, we could see significant strain on container availability and shipping schedules,” Christian Roeloffs, cofounder and CEO of Container xChange, said in a release.
“For small and medium-sized container traders, this could result in skyrocketing logistics costs and delays, making it harder to secure containers. The longer the disruption lasts, the more difficult it will be for these businesses to keep pace with market demands,” Roeloffs said.
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.
National nonprofit Wreaths Across America (WAA) kicked off its 2024 season this week with a call for volunteers. The group, which honors U.S. military veterans through a range of civic outreach programs, is seeking trucking companies and professional drivers to help deliver wreaths to cemeteries across the country for its annual wreath-laying ceremony, December 14.
“Wreaths Across America relies on the transportation industry to move the mission. The Honor Fleet, composed of dedicated carriers, professional drivers, and other transportation partners, guarantees the delivery of millions of sponsored veterans’ wreaths to their destination each year,” Courtney George, WAA’s director of trucking and industry relations, said in a statement Tuesday. “Transportation partners benefit from driver retention and recruitment, employee engagement, positive brand exposure, and the opportunity to give back to their community’s veterans and military families.”
WAA delivers wreaths to more than 4,500 locations nationwide, and as of this week had added more than 20 loads to be delivered this season. The wreaths are donated by sponsors from across the country, delivered by truckers, and laid at the graves of veterans by WAA volunteers.
Wreaths Across America
Transportation companies interested in joining the Honor Fleet can visit the WAA website to find an open lane or contact the WAA transportation team at trucking@wreathsacrossamerica.org for more information.