Today's Top Supply Chain and Logistics News From WSJ
November 16 2016 - 7:07AM
Dow Jones News
By Paul Page
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Consumer spending trends suggest this will be far from a
traditional holiday season for retailers and logistics companies
alike. New figures show retail sales in the U.S. expanded 0.8% in
October after a strong 1% gain in September, the WSJ's Josh
Mitchell reports, in the best two-month stretch of sales in at
least two years. The brisk spending is a strong sign that the
economy is picking up steam, with both wages and employment rising.
The expansion comes with a wrinkle, however, with sales at
department stores and furniture stores falling while sales at
"nonstore retailers" -- mostly e-commerce -- jumped 1.5% from
September to October and 12.9% year-over-year. Online sales are
growing at triple the rate of overall retail sales and the Commerce
Department figures show the pace of internet sales growth is
accelerating. With more Americans heading online to shop, retailers
and logistics operators may have to adjust inventories and
operations to e-commerce more than they thought.
The scale of the roller-coaster ride that ports and shippers
went through under Hanjin Shipping Co.'s turbulent collapse is
becoming clearer. Southern California's big gateways saw a big
surge in container shipments in October, with volume rebounding
strongly from a weak September, the WSJ reports. The sharp highs
and lows at the ports of Los Angeles and Long Beach came as
bankrupt shipping line Hanjin kept ships parked offshore for a time
before docking and unloading its vessels under court protection
from seizure. The result: a combined 4.9% year-over-year decline in
imports in September gave way to a 7.1% bump upward in October. For
importers, the big swings amounted to tens of thousands of
containers, one measure of the impact Hanjin's messy withdrawal
from the market had on retailer supply chains.
China's No. 2 e-commerce company is trying to redraw parts of
its business amid persistent losses. JD.com strongly expanded its
sales and its active user accounts in the third quarter, but the
WSJ's Joshua Jamerson reports the growth came at a steep cost, with
net losses nearly doubling from a year ago. The company, which has
made its logistics operation a linchpin of its business model, is
looking at ways to carve away its internet finance unit in a
maneuver that would allow the subsidiary to expand in its home
Chinese market. JD.com is one of several internet companies seeking
to tap credit demand among consumers and small and medium-size
businesses in mainland China. For JD.com, that demand could help
finance the investment in business the company really wants --
selling goods online.
SUPPLY CHAIN STRATEGIES
The automotive supply chain is becoming a battleground for
fierce competition among some of the world's technology giants.
Intel Corp. Chief Executive Officer Brian Krzanich says he plans
big new investment in autonomous car technology, the WSJ's Tim
Higgins reports, putting his company's computing muscle behind
self-driving cars. The message comes as chip companies are
positioning themselves to provide the computing power for what
quickly are becoming data centers on wheels. The role that Intel,
Qualcomm Inc. and Nvidia Corp. have in car manufacturing is
growing: Intel's automotive business, which is involved in 30
vehicle programs on the road currently, is slated to increase that
number to 49 by 2020 with orders worth $1 billion. That's why
manufacturers used to talking about horsepower increasingly are
trumpeting processing power, and why industrial supply chains now
are handling smaller components with much higher value than
traditional auto parts.
QUOTABLE
IN OTHER NEWS
China's yuan fell to its lowest level against the dollar in
nearly eight years. (WSJ)
Prices for foreign goods shipped to the U.S. rose in October.
(WSJ)
The U.S. Postal Service reported a wider loss for the fiscal
year ended Sept. 30, as package volume growth boosted revenue but
led to higher spending. (WSJ)
United Continental Holdings Inc. is postponing delivery of
dozens of Boeing Co. jets to trim spending. (WSJ)
Boeing will cut 500 net jobs over four years from its defense
and space business in Southern California. (WSJ)
Dick's Sporting Goods Inc. is concerned about high-margin
seasonal apparel sales, saying the retailer has not seen "any cold
weather to speak of." (WSJ)
Amazon.com Inc. is suing various vendors for allegedly selling
counterfeit goods through its web marketplace. (CNBC)
The U.S. Department of Energy awarded Purdue University $5
million to study truck platooning. (Fleet Owner)
Rickmers Maritime missed a bond interest payment and says it may
go out of business if lenders don't agree to r estructure the
shipping line's debt. (Straits Times)
The move toward cargo volume in passenger plane bellies at the
expense of freighters is leaving many airport cargo facilities
outdated. (The Loadstar)
An arson fire at an Amazon distribution center in the U.K. is
disrupting the flow of goods for some retailers. (Business
Insider)
Nearly half the rooftop of the Ikea International A/S 1.25
million-square-foot distribution center outside Chicago will be
covered with solar panels. (Chain Store Age)
CVS Pharmacy Inc. is building a 752,259-square-foot distribution
center near the Kansas City International Airport. (Business
Journals)
A series of lawsuits over fake Egyptian cotton sheets threaten
to unravel a key part of India's textile industry. (Bloomberg)
The prospective Great Lakes Basin Transportation says a portion
of the railroad near Chicago eventually could carry up to 85
freight trains daily. (Chicago Tribune)
Shipt and grocery chain Harris Teeter are teaming up to deliver
wine and beer in North Carolina. (Charlotte Observer)
ABOUT US
Paul Page is deputy editor of WSJ Logistics Report. Follow him
at @PaulPage, and follow the entire WSJ Logistics Report team:
@brianjbaskin, @lorettachao and @EEPhillips_WSJ, and follow the WSJ
Logistics Report on Twitter at @WSJLogistics.
Subscribe to this email newsletter by clicking here:
http://on.wsj.com/Logisticsnewsletter .
Write to Paul Page at paul.page@wsj.com
(END) Dow Jones Newswires
November 16, 2016 06:52 ET (11:52 GMT)
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