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LogisticsLogistics

Logistics Desert Bloom; Streamlining Supply Chains; Cloudy Solar Imports

By Paul Page

 

A 1 million-square-foot warehouse for Puma under construction along Arizona's Loop 303 freeway. PHOTO: CLARIUS PARTNERS

Warehouses are starting to bloom in the desert. A five-year-old freeway on the outskirts of Phoenix has become one of the fastest growing markets for logistics real estate in the country, the WSJ Logistics Report’s Liz Young writes, as companies look for storage space beyond the crowded and pricier corridors in some of America’s traditional distribution hubs. Phoenix seems an unlikely spot for a logistics hub because the city is relatively far from other destinations and anchors a comparatively small local market. But Dick’s Sporting Goods, REI and Chewy are among retailers taking up space in the Loop 303 corridor, a state highway partly lined by desert that connects two interstates. Puma is moving into a 1 million-square-foot building under construction, with plans to use the facility as a hub for its wholesale distribution across the western U.S. The city remains largely a trucking market, with intermodal rail service more challenging.

 
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Supply Chain Strategies

The Yankee Candle factory in Whately, Mass. PHOTO: KAYANA SZYMCZAK FOR THE WALL STREET JOURNAL

One of the country’s most diversified consumer-products suppliers wants to rein in its sprawling supply chain. Newell Brands, the company behind Yankee Candle, Sharpie markers and other consumer products, plans to spend some $100 million this year to consolidate its distribution centers around the U.S. The WSJ’s Kristin Broughton says the effort is part of a broader, multiyear project to improve its operations after a troubled merger weighed on its financial results. Newell previously operated more than 20 distribution centers that relied on shipments from West Coast ports. Once Newell’s capital investments are done, the company will operate seven distribution centers, including two new facilities in Pennsylvania and North Carolina along with five existing sites. The company hopes to do more than streamline real estate. Newell expects to cut transportation costs by choosing new sites with optimal distribution reach and spreading its ocean transportation spending among more carriers.

  • Clorox is working to streamline its supply chain and shift “decision-making closer to consumers and customers.” (Supply Chain Dive)
 
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Quotable

“The market is worse than we thought it would be.”

— Mark Murphy of semiconductor maker Micron Technologies, on declining chip demand.
 

Government & Regulation

Solar modules at a plant co-owned by Longi Green Energy Technology in China’s Shaanxi province. PHOTO: QILAI SHEN/BLOOMBERG NEWS

U.S. solar industry supply chains are hitting a geopolitical wall. Several major Chinese solar-panel suppliers have had shipments to the U.S. detained or sent back in recent weeks, the WSJ’s Phred Dvorak and Katherine Blunt report, as U.S. authorities start enforcing a crackdown on human-rights abuses in China’s Xinjiang region. The actions mark a new disruption for a U.S. solar sector as the Biden administration tries to balance aims of being tough on China, which dominates solar manufacturing, with its ambitious renewables goals. Industry executives and analysts say importers, suppliers and customs agents are still feeling their way on what it will take to get goods into the country. An attorney working to get shipments moving says some Chinese solar manufacturers “are scrambling right now” to navigate the legal terrain. One company is said to have suspended production at a panel factory in Vietnam that supplies the U.S.

 
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Number of the Day

$4.993

Average price per gallon for diesel fuel in the U.S. in the week ending Aug. 8, down 14.5 cents to the first reading below $5 a gallon since the first week of March, according to the Energy Information Administration.

 

In Other News

U.S. labor productivity declined for the second straight quarter as a measure of labor costs increased at a double-digit pace. (WSJ)

Nikola CFO Kim Brady is facing inflation challenges and supply-chain disruptions as the electric-truck maker looks to shake off a turbulent past. (WSJ)

Russian oil has stopped flowing through a pipeline that feeds countries in Central and Eastern Europe. (WSJ)

Endo International is likely to file for bankruptcy protection as it faces thousands of lawsuits alleging it fueled the opioid addiction crisis. (WSJ)

Luxury retail brands are bucking consumer trends with high sales growth rates in their most recent quarters. (WSJ)

Blue Alpha Capital projects the world’s biggest container lines are on course to post combined profits of around $256 billion this year. (Bloomberg)

Workers at the U.K.’s Port of Felixstowe moved closer to an eight-day strike after rejecting a new contract offer. (BBC)

Port of Savannah overall container volumes jumped 18% in July, including a 10.5% gain in loaded imports. (gCaptain)

Japanese energy company Inpex is making a $973 million claim against South Korea’s Daewoo Shipbuilding. (Maritime Executive)

Amazon is in talks to take a majority stake in Indian logistics startup Ecom Express for $500 million to $600 million. (Mint)

Convenience-store chain 7-Eleven has acquired food-delivery startup Skipcart. (The Information)

Retail group Signet Jewelers is buying online jeweler Blue Nile for $360 million. (CNBC)

A jury in New Hampshire acquitted a truck driver of all charges in connection with a 2019 crash that killed seven members of a motorcycle club. (New York Times)

Cargo volume at Germany’s Frankfurt Airport tumbled 11% in the first six months of the year. (Air Cargo News)

Domino’s Pizza is closing its stores in Italy. (Financial Times)

 

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

 
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