Trouble viewing this email?  View in web browser ›

The Wall Street Journal. The Wall Street Journal.

LogisticsLogistics

Sponsored by
Blue Yonder

Uber’s Buys Freight Growth; Railroad Labor Backlog; Instacart Eyes Fulfillment

By Paul Page

 

PHOTO: REUTERS

Uber Technologies is no longer trying to go it alone in the freight market. The ride-hailing giant’s $2.25 billion acquisition of technology-focused logistics services provider Transplace sharply raises Uber’s stakes in industrial shipping in the U.S., the WSJ Logistics Report writes, and gives the Freight unit access to a broader part of the third-party logistics market and a clearer path to profitability. Industry experts say Transplace came at an expensive price, but the buy advances Uber’s broader plan to expand beyond its core ride-hailing into delivery operations. It also brings the Freight unit an established business with deep contractual relationships with shippers, taking Uber Freight beyond the transactional freight brokerage that has brought the company rising market share with low margins. Armstrong & Associates says the companies have little apparent overlap in business and that pulling them together will make Uber Freight the country’s eighth-largest third-party logistics operator.

 
Advertisement
LEAVE THIS BOX EMPTY
 

Transportation

PHOTO: LUKE SHARRETT/BLOOMBERG NEWS

Labor problems at freight railroads are creating service headaches for U.S. shippers. The rail operators are struggling to bring back workers after a rapid retrenchment at the start of the pandemic. The WSJ’s Paul Ziobro writes the impact is cascading across the movement of chemicals, fertilizer and other industrial goods, threatening to disrupt factory operations and undercut a manufacturing rebound from the pandemic. The worker shortages are being exacerbated by congestion from products hitting rail networks, including intermodal shipments at backlogged West Coast ports that are creating pinch points where the railroads look to transfer containers. The problems have drawn scrutiny from federal regulators, who have been concerned that cost cuts and new efficiency plans that have been celebrated on Wall Street have resulted in lackluster service for some customers. The American Chemistry Council says some of its members have suspended factory production as delays have mounted.

 
Share this email with a friend.
Forward ›
Forwarded this email by a friend?
Sign Up Here ›
 

Quotable

“The supply chain is only as good as the weakest link in the chain, and there are a lot of weak links in the chain.”

— Citi transportation analyst Christian Wetherbee
 

Supply Chain Strategies

An Instacart shopper in Woodbridge, N.J. PHOTO: MICHAEL LOCCISANO/GETTY IMAGES

Instacart sees its path to growth going through warehouses. The app-driven grocery-delivery company plans to start building fulfillment centers across the U.S. in the coming months, the WSJ’s Jaewon Kang reports, in a partnership with technology company Fabric that will push Instacart beyond its core business that deploys shoppers working through store aisles. The company isn’t saying how many of the highly-automated warehouses it expects to build but notes retailers will own the inventory while Instacart helps them manage the goods. It’s seeking to take greater control of fulfillment operations as the food-delivery business faces new challenges. Online sales growth is slowing as shoppers head back to stores while the delivery companies themselves are still struggling to show profits. The Instacart action suggests in-store sales and online fulfillment are moving on divergent paths. Supermarkets may be seeing the limits in an omnichannel strategy combining storefronts with delivery operations.

 
Advertisement
LEAVE THIS BOX EMPTY
 

Number of the Day

29

Number of container ships anchored off the ports of Los Angeles and Long Beach on Thursday, the largest number waiting for berth space since April 2, according to the Marine Exchange of Southern California.

 

In Other News

The number of Americans receiving jobless payments fell this month to the lowest level since early in the coronavirus pandemic. (WSJ)

Lumber prices are rising again on worries over the impact of wildfires in the Pacific Northwest. (WSJ)

The median price for a home in the U.S. reached a record high in June. (WSJ)

Consumer-products supplier Unilever is accelerating price increases as it copes with rising costs for raw materials, packaging and shipping. (WSJ)

Intel CEO Pat Gelsinger says the global semiconductor shortage could stretch into 2023. (WSJ)

Government assistance helped lift American and Southwest airlines to profitability in the second quarter. (WSJ)

Mercedes-Benz is gearing up to go all-electric by the end of the decade. (WSJ)

Electric-vehicle startup Rivian Automotive plans to open a second factory in the U.S. (WSJ)

Toyota halted auto production at its three Thailand factories as a Covid outbreak disrupted parts deliveries. (Nikkei Asia)

Hyundai Motor warned the chip shortage will hurt its sales in the third quarter after the auto maker posted the best quarterly results in seven years. (Financial Times)

Norfolk Southern is expanding intermodal capacity in Chicago amid a crush of containers hitting rail yards. (Trains)

Second-quarter profit at Union Pacific jumped 59.2% to $1.80 billion on a 22% gain in revenue carloads. (MarketWatch)

Major ports in Southeast China are bracing for the impact of a typhoon set for landfall over the weekend. (Lloyd’s List)

Steel manufacturer Nucor is acquiring warehouse racking supplier Hannibal Industries. (Modern Materials Handling)

The owner of Paschall Truck Lines acquired Joplin, Mo.-based truckload carrier Transport Distribution. (Commercial Carrier Journal)

Last-mile delivery company Fusion Logistics is laying off more than 300 workers in Texas. (Dallas Morning News)

 

About Us

Paul Page is editor of WSJ Logistics Report. Write to him at paul.page@wsj.com.

Follow the WSJ Logistics Report team: @PaulPage, @jensmithWSJ and @pdberger. Follow the WSJ Logistics Report on Twitter at @WSJLogistics.

 
Desktop, tablet and mobile. Desktop, tablet and mobile.
Access WSJ‌.com and our mobile apps. Subscribe
Apple app store icon. Google app store icon.
Unsubscribe   |    Newsletters & Alerts   |    Contact Us   |    Privacy Policy   |    Cookie Policy
Dow Jones & Company, Inc. 4300 U.S. Ro‌ute 1 No‌rth Monm‌outh Junc‌tion, N‌J 088‌52
You are currently subscribed as [email address suppressed]. For further assistance, please contact Customer Service at sup‌port@wsj.com or 1-80‌0-JOURNAL.
Copyright 2021 Dow Jones & Company, Inc.   |   All Rights Reserved.
Unsubscribe