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LogisticsLogistics

West Coast Ports Want Boxes Back; Who’s Paying for Food Delivery?

By Paul Page

 

A containership enters the Port of Oakland last month. PHOTO: JUSTIN SULLIVAN/GETTY IMAGES

The race for control of U.S. inbound supply chains is getting more heated. With the ratification of a six-year dockworker contract agreement in hand, West Coast ports now are focused on recovering the business they lost to diversions in the past year as shippers sought to avoid potential labor disruptions. The WSJ Logistics Report’s Paul Berger writes the ports from Southern California to Seattle face big hurdles in their efforts, including geopolitical tensions, nearshoring trends and lagging economic growth in China. Manufacturing trends in the U.S. are also playing a role, as a growing network of electric-vehicle and battery factories in the southeast draw more trade flows, raising the profile of ports like Savannah in Georgia and Charleston, S.C. The West Coast is still the preferred gateway for many importers bringing in goods from factories in Asia. But the region has been losing share over several years.

 
 

Quotable

“It will be an uphill climb.”

— Port of Los Angeles Executive Director Gene Seroka, on recovering diverted cargo
 
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E-Commerce

A DoorDash delivery worker in New York City early in the pandemic. PHOTO: JOHN MINCHILLO/ASSOCIATED PRESS

The intertwined relationship between food-delivery services and restaurants is turning into a battle over pricing. Many restaurants and chains have been raising prices on food they sell through delivery apps. The WSJ’s Preetika Rana and Heather Haddon report that delivery operators including DoorDash and Uber Eats have been pushing back, deploying their own tools to make price increases painful for restaurants. The tug of war over consumer dollars highlights the pricing tension between the service providers, restaurants and consumers. The delivery companies may have solved the logistics of getting goods to buyers, but the cost of last-mile delivery remains a tough financial equation, particularly for time-sensitive items like meal orders. The battle is getting more pitched as both sides grapple with inflation and a tougher economy. Delivery companies say they’re trying to keep consumers ordering, but the restaurants say the online sales come with untenable pressure on margins.

  • Amazon and Shopify struck an agreement allowing merchants on Shopify’s e-commerce platform to use Amazon’s delivery network. (TechCrunch)
 

Quotable

“I don’t love the premium. But I’m happy to pay for the convenience.”

— Martin Roth, a customer of food-delivery services in San Francisco
 
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Number of the Day

43,800

Decline in trucking-sector employment from January to August, including the 30,000 job losses on Yellow’s shutdown, according to the Bureau of Labor Statistics.

 

In Other News

Hiring in the U.S. slowed this summer and the unemployment rate rose in August. (WSJ)

Typhoon Saola lashed the southern coast of China near the Port of Hong Kong as a Category 4 superstorm. (WSJ)

Tesla is winning the race for federal grants to build out an electric-vehicle charging network. (WSJ)

The United Auto Workers union is accusing two automakers of not bargaining in good faith, two weeks before labor contracts are set to expire. (WSJ)

Europe’s largest copper producer says it may face hundreds of millions of euros in losses from a theft in its recycled materials business. (WSJ)

Russian drones hit Danube River port infrastructure that is critical to Ukraine's grain exports. (Reuters)

South Korea’s slumping exports and other weak figures are raising concerns that China’s slowing growth is reaching other Asian economies. (Financial Times)

China’s electric-vehicle exports have grown eightfold in the past five years. (Nikkei Asia)

Freight rates for barges in the Midwest are surging as Mississippi River water levels drop. (Bloomberg)

Best Buy’s suppliers have been financing more price discounts on the retailer’s electronic products. (Supply Chain Dive) 

Retailer Crate & Barrel is adding technology to its supply chain to better manage its inventories. (Chain Store Age)

Top tanker operators are on track for a second straight year of record earnings. (ShippingWatch)

JP Morgan ordered two dual-fuel methanol carriers to be fixed with France’s TotalEnergies. (Seatrade Maritime)

China International Marine Containers says worldwide box production hit a 10-year low in the first half of 2023. (The Loadstar)

DHL launched an international same-day delivery service in the U.K. (Logistics Manager)

 

About Us

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

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

 
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