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Walmart Eases Supplier Benchmarks; U.S. Targeting Container Cranes

By Paul Page

 

A Walmart distribution center in Washington, Utah. PHOTO: GEORGE FREY/GETTY IMAGES

Walmart is easing the pressure on its suppliers as strains in its supply chain recede. The retail behemoth is reducing some of the “on-time, in-full” thresholds that it has imposed on suppliers of consumer goods and other items, the latest shift in a logistics effort that historically has left companies scrambling to meet the retail giant’s demands. The WS Logistics Report’s Liz Young writes that Walmart’s benchmarks have been lowered as the retailer’s inventory levels have steadied and ordering patterns have moved back toward prepandemic norms. Walmart said this week that its storerooms are “quite under control.” The delivery requirements have focused attention across the logistics sector on the point where goods reach the complicated and often congested sites outside the dock doors of distribution centers. Industry officials say delivery performance among consumer-goods suppliers generally rebounded last year after turning downward at the onset of the pandemic.

  • Walmart-owned Indian e-commerce giant Flipkart is in discussions about acquiring hyperlocal delivery startup Dunzo. (TechCrunch)
 
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Government & Regulation

The U.S. fears cranes made by ZPMC could gather intelligence using software that tracks shipping containers. JUSTIN SULLIVAN/GETTY IMAGES

The White House is putting potentially billions of dollars behind an effort to build a U.S. container-crane manufacturing operation to rival the sector’s dominant, China-based operator. The move is part of a set of actions aimed at improving maritime cybersecurity, the WSJ’s Dustin Volz, Gordon Lubold and Doug Cameron report, and funnels more than $20 billion toward port security over the next five years, including threats the administration says arise from crane manufacturer ZPMC. The money would support plans by a U.S. subsidiary of Japan’s Mitsui to produce the first big cranes made in the U.S. in some 30 years. ZPMC cranes account for nearly 80% of ship-to-shore cranes in use at U.S. ports. The massive machines hold sophisticated sensors that can register and track the origin and destination of containers. U.S. officials say that presents potential dangers of espionage and disruption if the cranes could be manipulated remotely.

 

Quotable

“By design these cranes may be controlled, serviced and programmed from remote locations. These features potentially leave PRC-manufactured cranes vulnerable to exploitation.”

— Rear Adm. John Vann, who leads the Coast Guard cyber command
 
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Number of the Day

111

The American Trucking Associations’ seasonally adjusted for-hire truck tonnage index for January, down 3.5% from December and 4.7% behind the year-ago index to the lowest level since August 2021.

 

In Other News

The share of food costs in Americans’ household spending has increased to the highest level in 30 years. (WSJ)

Electric-vehicle maker Rivian will lay off 10% of its salaried workforce and expects vehicle output to be flat this year. (WSJ)

Amazon is replacing Walgreens in the Dow Jones Industrial Average of 30 blue-chip stocks. (WSJ)

The Boeing executive in charge of the factory that built the jet involved in last month’s door-plug blowout is leaving the company. (WSJ)

Glencore’s earnings fell by half to about $17.1 billion on falling coal prices. (WSJ)

Growing industrial demand is helping China’s miners withstand the slump in the country’s property sector. (WSJ)

Rio Tinto approved a $20 billion iron ore mining, rail and port project in West Africa that will include several partners from China. (Financial Times)

California’s Inland Empire logistics sector has fallen into a slump, with warehousing jobs contracting for the first time in more than two decades while industrial vacancies are rising and rents are dropping. (Los Angeles Times)

United Parcel Service added facilities in New York, Rhode Island and Virginia to sites where it is shrinking package sorting operations. (Supply Chain Dive)

The rapid rise of fast-fashion e-commerce retailers such as Shein and Temu is triggering high air cargo demand and strong competition for the hefty volumes. (Reuters)

Taiwanese startup Starlux Airlines ordered five Airbus A350 freighters to launch its cargo operation. (Aviation Week)

U.S. container imports from Asia by volume rose 16% in January, the fourth straight increase. (Journal of Commerce)

Fourth-quarter profit at Hawaii-based container line Matson fell 20% to $62.4 million. (TradeWinds)

Shoe supplier Skechers is opening a highly-automated distribution center in Tokyo. (Sourcing Journal)

Ryder System opened a large multiclient warehouse and cross-dock facility in Laredo, Texas. (FleetOwner)

A federal jury convicted the former finance chief at a National Air Cargo subsidiary and his wife of defrauding the business​ of $5 million. (The Loadstar)

 

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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