Today’s Logistics Report: Merging Shipbuilders; Casting Logistics Recruiting Nets; Selling Freight Payment
Today’s Top Supply Chain and Logistics News From WSJ
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China is undertaking its most ambitious maritime project yet in combining two of its big shipbuilders into a single behemoth. The merger of China Shipbuilding Industry Corp. and China State Shipbuilding Corp. would create the world’s second-largest shipbuilder, the WSJ’s Trefor Moss reports, in the latest move by Beijing to supersize state-run businesses for global competition. The companies last year had combined orders by tonnage accounting for roughly 13% of the global total, but both are contending with broader forces in the shipping industry. Consolidation driven by tough industry economics is underway, including the pending merger of Korean shipbuilders Hyundai Heavy Industries and Daewoo Shipbuilding and Marine Engineering Co. And China still lags behind other shipbuilders in shipping technology, which Beijing lists as one of the 10 high-tech sectors where it wants to upgrade industrial production.
Logistics recruiters are casting virtual nets in their efforts to find workers in a tight job market. The companies are turning to digital tools more familiar in the consumer world, including a technique called geofencing that targets people as they drive by distribution centers or even park their cars in competitors’ lots. The WSJ Logistics Report’s Jennifer Smith writes the ramped-up digital strategy is the result of booming e-commerce demand and a decades-low unemployment rate that’s put a premium on the ability to find workers, let alone hire them. Instead of just placing radio or newspaper job ads, companies are using the Global Positioning System and digital signals emitted by smartphones to zoom in on prospective recruits, particularly those that move within a digital fence that recruiters build. The workers then get Facebook ads or other lures aimed at getting them into the warehouse doors.
TRANSPORTATION
A bulk ship under construction in Jiangyin, China, in 2018. PHOTO: ALEKSANDAR PLAVEVSKI/EPA-EFE/REX/SHUTTERSTOCK
The troubled bankruptcy of IPS Worldwide LLC is over, at least for the remaining customers of the failed freight-payment company. A bankruptcy judge approved the sale of the Florida-based business’s remaining assets to Belgium’s Europe Management SPRL, which will use the acquisition to extend its freight payables audit and payment services in the U.S. The WSJ Logistics Report’s Jennifer Smith writes the $2.3 million sale price was a shadow of the tens of millions of dollars in payments that IPS handled for a range of big shippers, included Stanley Black & Decker Inc., Alcoa Corp. and Arconic Inc. IPS was the first freight-payment company to file for bankruptcy protection since two operators went belly-up in 2013, financial failures that are hard to explain in a business that manages invoices and payments. A judge said IPS’s failings appeared to be the result of gross mismanagement and incompetence.
A restaurant in the age of e-commerce may no longer be a place to eat a meal. A handful of startups are opening shared kitchens in industrial buildings to serve entirely as bases for online distribution, in a bid to liberate restaurants and grocery stores from pricey, street-facing retail space. The WSJ’s Konrad Putzier writes the operations are a new sign of how digital commerce is changing the physical landscape of traditional businesses, this time by putting logistics at the center of the restaurant business alongside the menu and food preparation. In another sign of the shift, some investors are building cold-storage facilities, betting that more people will order groceries online and that demand will increase for places to store perishable food close to big cities. And it means that instead of looking to attract foot traffic, the digitally-focused operators will add features like loading space for delivery vans.
QUOTABLE
If somebody is going to sit in their car for 30 minutes before their shift…and watch YouTube, I want them to watch our ads in the preroll.
Number of the Day
13,100
North American heavy-duty truck orders in June, a 69% decline from a year ago and 20% increase from May, according to ACT Research.
IN OTHER NEWS
The U.K. economy slowed sharply in the second quarter. (WSJ)
Australia’s central bank cut interest rates for the second time in as many months. (WSJ)
South Korea’s semiconductor exports fell 25.5% in June. (WSJ)
Major auto makers reported falling U.S. new-vehicle sales in the first half of 2019. (WSJ)
Coal producer Blackjewel LLC may liquidate after a lifeline intended to finance a restructuring in bankruptcy fell apart. (WSJ)
Austrian lawmakers voted to ban the key chemical in Roundup--a first in Europe and a fresh blow to Bayer AG . (WSJ)
Global sushi-chain giant YO is buying Houston-based sushi-kiosk operator SnowFox. (WSJ)
Volvo Group will spend about $400 million to upgrade the Virginia plant that produces all of Volvo’s North American trucks. (Fleet Owner)
German lender KfW Group will no longer finance coal mining exploration or lend to coal power plant projects. (Bloomberg)
Germany’s Commerzbank exited the shipping business with the sale of the last of its maritime loans. (TradeWinds)
Analysts expect 4,000 ships world-wide will use scrubbers to meet the global mandate to lower sulfur emissions next year. (Lloyd’s List)
More companies are leaving Britain’s shipping registry due to uncertainty over the U.K.’s departure from the European Union. (Reuters)
The Port of Rotterdam received its first blockchain-managed container shipment. (Maritime Executive)
European logistics companies face a deepening shortage of labor for transport and warehousing operations. (Lloyd’s Loading List)
Twelve U.S. states are raising their diesel fuel taxes this month. (Commercial Carrier Journal)
U.S. investigators are examining long delays that emergency responders face because of the use of longer freight trains. (American Shipper)
William Flynn will retire as president and chief executive of Atlas Air Worldwide Holdings Inc. and be replaced by John Dietrich. (Air Cargo World)
A French company will build a wind-powered roll-on, roll-off carrier this year. (The Loadstar)
ABOUT US
Paul Page is editor of WSJ Logistics Report. Follow the entire WSJ Logistics Report team: @PaulPage, @jensmithWSJ and @CostasParis. Follow the WSJ Logistics Report on Twitter at @WSJLogistics.
Write to Paul Page at paul.page@wsj.com
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