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LogisticsLogistics

Packaging Orders to Fit; Questioning Container Cranes; Cars in Overdrive

By Paul Page

 

Amazon says it is expanding its use of technology that makes boxes designed specifically to fit the items being shipped. PHOTO: BRENDAN MCDERMID/REUTERS

Big retailers are moving to tackle the cardboard overload in their e-commerce operations. Walmart and Amazon are among companies rolling out technology that aims to fit packaging to the items being shipped, cutting down on the number of small items that are sent out in bulky, oversized boxes. The WSJ Logistics Report’s Liz Young writes the made-to-fit packaging addresses a major environmental issue in online shopping, and a cumbersome expense in shipping out orders. The problem has been magnified during the pandemic, with a surge in e-commerce orders sending a flood of boxes onto household doorsteps, and eventually into trash heaps and recycling centers. Shifting prices and availability of cardboard have also added headaches for online merchants trying to keep up with the online demand. Walmart has installed machines that make custom boxes at 12 of its fulfillment centers, and plans to add the technology to more facilities.

 
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Government & Regulation

Chinese officials dismiss U.S. concerns as paranoia and an attempt to obstruct trade and economic cooperation. Shown, the Port of Baltimore. PHOTO: ANNA MONEYMAKER/GETTY IMAGES

Members of Congress are raising questions about the security of cranes at U.S. ports. Lawmakers who oversee the Department of Homeland Security want to hold hearings and get government documents on potential security vulnerabilities posed by dozens of Chinese-made container cranes at the ports. The WSJ’s Gordon Lubold and Aruna Viswanatha report that the demand for more information follows a Journal story last month that detailed concerns over cranes made by state-owned Shanghai Zhenhua Heavy Industries, or ZPMC. House Homeland Security Committee Chairman Mark Green says it is “extremely worrisome” that about 80% of American port container cranes use software from a company with ties to China’s People’s Liberation Army. Another lawmaker, Wisconsin Republican Mike Gallagher, said after visiting the Miami port that Miami and other gateways had mitigated near-term concerns by using alternate software but that he has concerns about ZPMC’s long reach.

  • The operations of one cargo vessel show how China has allowed ships sanctioned by the United Nations to continue serving North Korea. (Washington Post)
 

Number of the Day

$34.7 Billion

Combined net profit for container shipping lines in the fourth quarter, down 34%, or $17.8 billion, from the year-ago quarter in the second straight quarterly decline, according to The McCown Report.

 
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Manufacturing

A car carrier at Tesla's factory in Fremont, Calif. PHOTO: JOHN G MABANGLO/EPA-EFE/SHUTTERSTOCK

Automotive inventories are finally starting to catch up to sales. Car makers are reporting higher sales to start the year just as dealership stocks that had been constrained by supply-chain snarls have begun to bounce back. The WSJ’s Ryan Felton reports the stronger sales are a sign the auto business is moving past some of the acute shortages that have dogged the sector in recent years. General Motors, Hyundai and Nissan reported double-digit gains in the first quarter, and J.D. Power estimates industrywide sales are likely to be up 6% year-over-year. Shipments are growing: Carloads of motor vehicles and auto parts on U.S. railroads were up nearly 10% in the first 12 weeks of the year, according to the Association of American Railroads. Still, Wards Intelligence says dealership stocks remain below historic norms even after the recent gains.

  • China Merchants Energy Transport is buying up to six large car carriers with methanol fuel capability. (Maritime Executive)
 

Quotable

“The problem is our dealerships are just selling them faster than we’re producing them.”

— Jack Hollis of Toyota, an outlier in the automotive sector with a 6% decline in first-quarter U.S. sales.
 
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In Other News

Oil prices rose at the fastest pace in nearly a year on news that Saudi Arabia would cut crude output. (WSJ)

A measure of U.S. factory activity fell deeper into contraction territory in March. (MarketWatch)

South Korea’s exports fell in March for the sixth straight month. (Dow Jones Newswires)

Commodities giant Glencore is resuming acquisitions activity with an unsolicited bid for Canadian miner Teck Resources. (WSJ)

Online grocery wholesale firm Boxed filed for bankruptcy protection and plans to sell its software business. (Dow Jones Newswires)

Walmart is laying off nearly 600 workers at a distribution center in Pennsylvania’s Lehigh Valley. (PennLive)

Walmart plans to extend the truck driver workflow app it developed for its private fleet to third-party operators. (Commercial Carrier Journal)

Shekar Natarajan has left his position as president of American Eagle Outfitters’ logistics subsidiary Quiet Platforms. (Insider)

Apparel retail group PVH inventories were up 34% year-over-year in the fiscal quarter ending Jan. 29 as logistics disruptions eased. (Supply Chain Dive)

A group of shipowners and other companies in bulk markets have formed a freight association as an alternative to the Baltic Exchange. (TradeWinds)

Packwell is building a 725,000-square-foot facility at Port Houston to handle the gateway’s growing resin export trade. (Railway Age)

SF Airlines began freighter flights to Belgium from China’s new all-cargo Ezhou Huahu Airport. (Air Cargo News)

Distribution Solutions Group is acquiring fellow industrial supplies distributor Hisco for $269 million. (Modern Distribution Management)

 

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 Twitter at @WSJLogistics.

 
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