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Seeking Cleaner Rail Locomotives; China EV Supply Chain in Overdrive

By Paul Page

 

The freight-rail industry is facing pressure to find cleaner alternatives to its traditional diesel-electric locomotives. PHOTO: CHARLIE RIEDEL/ASSOCIATED PRESS

The race on the rails is on for a cleaner locomotive. Railroads and equipment suppliers are investing in diesel-electric models that are more fuel-efficient, as the sector tries to not be left behind in the drive for alternative power in freight transport. The WSJ’s Esther Fung reports companies are homing in on batteries, biodiesel and hydrogen as potential replacements. Right now, major freight railroads are focused on battery-electric locomotives for some port and rail-yard operations. Initial results show far less range than conventional equipment, and BNSF Railway notes they take far longer to charge than it takes to refuel a diesel locomotive. There are hybrid solutions: rail-equipment provider Wabtec plans to deliver battery-electric locomotives this year that it says can be added onto trains that make long-haul runs using multiple locomotives. Wabtec says biodiesel and renewable diesel could also reduce carriers’ carbon emissions by up to 60%.

  • Canadian business executives are calling for legislation to avert a potential strike against the country’s two big railroads. (Dow Jones Newswires)
 
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Quotable

“A containers shortage has increased costs and slowed down the supply chain.”

— A senior executive at a management company in the latest Institute for Supply Management manufacturing survey.
 

Supply Chain Strategies

Xiaomi brought its SU7 sedan to a trade show in Barcelona in February. PHOTO: DAVID ZORRAKINO/ZUMA PRESS

Maybe building an electric car isn’t quite the challenge it’s made out to be. Chinese electronics company Xiaomi, the world’s No. 2 smartphone maker, has pulled off what longtime rival Apple couldn’t by developing an electric vehicle and bringing it to market, all in three years. The WSJ’s Sha Hua and Yoko Kubota report that Xiaomi’s feat illuminates a new reality in the automotive business: The barriers to entry for making a car have shrunk. As hardware has become simpler, the focus on product appeal has shifted to software and features. To save on time and costs, the company adopted practices from Tesla and other automakers, mined its own product-development know-how and plugged into China’s fast-moving car supply chain. Still, Xiaomi CEO Lei Jun told Chinese state television that making cars required a new level of complexity, along with some 6,000 people to work on the car project.

 

Number of the Day

$18.2 Billion

Net merchandise inventory at retailer Lowe’s in the quarter ending May 3, down 6.6% from the same quarter last year, as net sales declined 4.4% year-over-year.

 

In Other News

The U.S. is leaning on Europe to help defend against a surge of Chinese exports, trying to rally allies that hold distinct views of how to respond to Beijing’s economic might. (WSJ)

The Macy’s department-store chain raised its outlook after reporting a better-than-expected 2.7% decline in first-quarter sales. (WSJ)

Comparable-store sales at home-improvement retailer Lowe’s fell 4.1% last quarter. (WSJ)

Hamid Moghadam of Prologis was the highest-paid CEO in a logistics-related business in a Journal analysis of executive pay and the seventh-highest overall, with $50.89 million in annual compensation. (WSJ)

The New York Fed says about a third of services companies and nearly half of manufacturers still report difficulties obtaining supplies. (Bloomberg)

Drug maker AstraZeneca is building a separate Chinese supply chain to try to circumvent increased US-China tensions. (Financial Times)

A federal measure of trucking pricing showed truckload rates fell 4.4% in the first four months of 2024 while less-than-truckload prices rose 8.2%. (Trucking Dive)

Expedited trucker Forward Air named Jamie Pierson as interim CFO after Rebecca Garbrick announced her departure. (Dow Jones Newswires)

The head of Tesla’s Semi program says another 50 of the electric heavy-duty trucks are on their way to PepsiCo, the sole fleet with the big rigs. (Commercial Carrier Journal)

Container shipping lines are restricting freight forwarders’ access to fixed-rate bookings in new trans-Pacific contracts. (Journal of Commerce)

Israeli container carrier Zim swung to a $167 million operating profit in the first quarter as revenue jumped 14%. (The Loadstar)

South Carolina’s Port of Charleston delayed opening for a second straight day after a software malfunction. (Post and Courier)

Port of Los Angeles chief Gene Seroka says growing shipments from China into Mexico don’t pose a significant threat of lost volume for the U.S. port. (AJOT)

Chemical shipper Stolt-Nielsen agreed to pay $290 million to settle claims over a deadly explosion on a Mediterranean Shipping vessel 12 years ago. (TradeWinds)

Walmart says it improved its net cost per delivery of consumer orders by 40% over the past 12 months. (Supply Chain Dive)

Yamaha Motor is looking to revive its new-businesses segment by focusing on logistics services in emerging markets. (Nikkei Asia)

U.K. trucker John Jempson and Son is liquidating after 150 years in business​ and transferring staff to XPO Logistics. (Motor Transport)

 

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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