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LogisticsLogistics

Truck Equipment is Trailing; Inland Empire Jammed; Online Sales Liability

By Paul Page

 

The Flying J truck stop at Breezewood, Pa. PHOTO: CHIP SOMODEVILLA/GETTY IMAGES

Supply-chain turmoil is hitting the very transportation equipment needed to haul goods. Shortages of parts and labor are crimping production at truck-trailer factories, the WSJ Logistics Report’s Lydia O’Neal reports, undercutting trucking companies’ efforts to expand capacity in tight shipping markets. Supply-chain snarls have been rolling across the transportation equipment market, with supplies of heavy-duty trucks and the chassis used to carry shipping containers strained. Backlogs for trailers now stretch deep into 2022 and orders for the equipment are tumbling because factory slots have dried up and manufacturers are reluctant to add to the backups. Companies including Wabash National and Felling Trailers say they’ve coped with shortages of numerous parts, from wheels to tail-light wiring. ACT Research says factories have trimmed backlogs to around eight months from 13 months earlier this year. Still, freight operators are pushing back fleet overhauls and holding onto used trailers longer.

 
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Supply Chain Strategies

While most attention to supply-chain congestion is focused on the Southern California ports, a backup nearly as bad has formed a few miles east in the Inland Empire. Warehouses in the region crucial to the distribution of imports are jammed, and a WSJ video describes how the tight capacity combined with port delays are upending supply chains. The region hosts some 600 million square feet of warehouse space, but the vacancy rate of just 0.7% signals the sprawling sites are full. Delays at the ports are leaving shelves at fully-occupied warehouses empty, however, a gap that is adding to the complications in supply chains. The disconnect is leaving inventories for businesses low and lengthening delivery times for customers.

 
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Quotable

"I can’t promise that every person will get every gift they want on time. Only Santa Claus can keep that promise."

— President Biden
 

E-Commerce

The Shopify website. PHOTO: ANDREW HARRER/BLOOMBERG NEWS

A publishing industry lawsuit is aiming to teach a lesson on liability in online commerce. A group of five publishers is suing e-commerce technology provider Shopify, the WSJ’s Vipal Monga reports, claiming the company is responsible for unauthorized textbooks, test packs and other materials sold by websites using Shopify’s online tools. The suit is the latest example of people seeking to hold Internet platforms and broadband providers liable for the actions of their users. The publishers, including Pearson Education and McGraw Hill, say in their suit that they have asked Shopify since 2017 to take down the sites selling the unauthorized items. But they say the e-commerce company has retained those customers and has refused to identify the owners of alleged pirate websites. The suit follows complaints by retailers that e-commerce platforms at Amazon and Alibaba have hosted counterfeit products, which prompted those companies to crack down on third-party sellers.

 
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Number of the Day

$37.24 billion

Combined operating profit for container shipping lines world-wide in the third quarter, nearly equal to the entire combined operating earnings for the carriers from 2010 to 2020, according to Sea-Intelligence.

 

In Other News

Factory activity in the U.S. rose in November and measures showed manufacturers’ order backlogs declining and supplier deliveries speeding up. (WSJ)

The Federal Reserve says U.S. economic growth advanced at a “modest to moderate” pace this fall as supply-chain issues and labor shortages weighed on expansion. (WSJ)

Growth in eurozone manufacturing activity stabilized in November following a four-month slowdown. (Dow Jones Newswires)

The OECD says the pickup in inflation rates around the world will be longer-lasting and sharper than previously anticipated. (WSJ)

U.S. benchmark oil prices dipped to their lowest closing price since August 20. (Dow Jones Newswires)

Contract semiconductor manufacturer GlobalFoundries swung to a third-quarter profit and its revenue rose 56%. (WSJ)

The chairman of A.P. Moller-Maersk and Siemens expects chaos in supply chains to persist through the middle of 2022. (CNBC)

Instacart plans to test delivery in 15 minutes or less to U.S. customers. (The Information)

Furniture companies face delayed orders and depleted inventories as factories in Vietnam work to ramp up production. (Supply Chain Dive)

Alphaliner says South Korea plans to privatize HMM next year after rescuing the container shipping line in 2016. (ShippingWatch)

Cargo salvage companies are seeing booming business as supply-chain snarls leave more goods abandoned at ports. (Bloomberg)

Freight forwarder Geodis bought France-based less-than-truckload carrier Transports Perrier. (Lloyd’s Loading List)

Blackstone Group bought a portfolio of logistics facilities​ from Cabot Properties for $2.8 billion. (Real Estate Weekly)

Mergers and acquisitions among industrial suppliers accelerated rapidly in November. (Industrial Distribution)

The former CFO of trucker Roadrunner Transportation was sentenced to two years in prison for his role in a securities and accounting fraud scheme. (Milwaukee Journal-Sentinel)

Authorities suspect a FedEx driver in Alabama dumped packages at a remote wooded site at least six times. (CNN)

 

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  @LydsONeal and @pdberger. Follow the WSJ Logistics Report on Twitter at @WSJLogistics.

 
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