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.
Teamsters union negotiators have withdrawn a contract demand that UPS Inc. ban the use of drones and autonomous vehicles to carry out package delivery services, according to a dissident Teamster group.
Denis Taylor, who heads the Teamsters' package division responsible for labor relations between the Atlanta-based company and the approximately 256,000 union members who handle UPS' main business line, pulled the proposal, according to a note published yesterday on the "Teamsters United" website. Teamsters United was a slate formed prior to the union's 2016 general election largely out of dissatisfaction with the mainstream Teamster leadership.
The note on the website did not disclose why Taylor withdrew the demand, or when he may have done it. Ken Paff, national organizer of the Teamsters for a Democratic Union (TDU), a dissident group that is working with Teamsters United, thought Taylor's decision was "odd," but ventured no guess as to why the demands were withdrawn.
The two sides completed the second week of talks on Friday aimed at reaching a new collective bargaining agreement to replace the five-year compact that expires Aug. 31. Paff said he doubted UPS pressured Taylor to pull the proposal because such an approach rarely, if ever, takes place so early in a contract negotiation. UPS and the Teamsters declined comment.
According to the site, UPS has also proposed to launch Sunday deliveries with the option of using part-time drivers operating their personal vehicles. The company has also requested all new employees deliver packages using their personal vehicles, Teamsters United said. The union opposes both proposals.
The site also said UPS wants to expand the use of "Surepost," a service it operates along with the U.S. Postal Service, so it could siphon delivery work from UPS Teamsters. Packages tendered to UPS and bound for residences are inducted deep into the postal network for final delivery by letter carriers. The Teamsters want to kill Surepost and turn over those deliveries to UPS union drivers.
In addition, UPS wants to be allowed to designate up to 20 percent of the routes at each location as residential routes, which Teamsters United said would result in drivers being paid at a lower rate than if they moved business-to-business packages. B2B packages, a high-margin business that has long been UPS' bread-and-butter, has been overtaken in the company's mix by business-to-consumer deliveries, a by-product of the soaring and seemingly relentless demand for e-commerce orders.
Teamsters United is headed by Fred Zuckerman, the head of Local 89 in Louisville, the location of UPS' primary air hub known as "Worldport," and the largest Teamster local in the UPS system with more than 10,000 members. In the 2016 election, Zuckerman came close to unseating incumbent James P. Hoffa, and outpolled Hoffa among U.S. voters. However, Hoffa's overwhelming victory margin in Canada offset the U.S. results and won him a fifth term as president. The slate captured six seats on the 24-member Teamster board, however. It is widely believed that most UPS Teamsters sided with Zuckerman in the election.
Zuckerman, who has a history of volatile relations with UPS and Teamster leadership, is expected to be a major voice during the contract talks. The negotiating landscape is expected to change several times before an agreement is eventually reached.
The centerpiece of the Teamsters package division's initial salvo is a demand that UPS create 10,000 full-time small-package jobs out of 20,000 existing part-time positions as part of a pledge to fill at least 20,000 full-time jobs with part-time employees. The union also wants UPS to establish a "premium service driver" classification which will be utilized when the Atlanta-based company's existing over-the-road feeder network can't adequately meet its service requirements. Drivers would be typically used to move loads between ground and air hubs more than 250 miles apart, according to the union proposal.
Organized labor is typically suspicious of technological advancements for fear it will take jobs away from humans. UPS, which is moving aggressively to integrate technology across its entire operation, has made no secret of its interest in drones and has made drone testing available for public viewing. It has been more circumspect with regards to autonomous vehicles, sensitive to the direct impact their utilization would have on concerns over drivers' job security.
In a related development, Teamsters United said that concurrent contract talks with UPS Freight, UPS' less-than-truckload (LTL) unit, will go nowhere until the issue of subcontracting work to non-union drivers is dealt with to the rank-and-file's satisfaction. The union has proposed a ban on all subcontracting of work normally done by a bargaining unit member.
Economic issues such as wages and benefits will be addressed in future negotiations, the union group said. The roughly 12,000 UPS Freight Teamsters want "significant improvements" to what the group called a "substandard" contract.
Separately, UPS said it will build a $1 million package operations center in El Paso to support business in what is known as the "North America Borderplex." The center will serve a region that includes Texas, New Mexico and Ciudad Juarez, Chihuahua, Mexico, and is home to about 2.5 million people, UPS said.
The facility, which will add more than 153,000 square feet of new processing capacity, is expected to begin operating in late 2018, UPS said.
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.