Trucking executive points to final mile delivery as draining driver pool, so think about that on Cyber Monday.
Good day,
Two important dates for determining the health of U.S. retailers and consumers are Black Friday and Cyber Monday, both of which provide the first read holiday spending. But another important date comes November 29, when President Donald Trump meets with Chinese President Xi Jinping at the G20 Summit to discuss security and economic relations between the two nations. The outcome of the meeting could determine whether the U.S. will rollback tariffs on $250 billion in Chinese imports, or go forward with tariffs on another $267 billion in goods, effectively covering the entirety of China’s exports to the U.S. While the tariffs have done little to slow U.S. consumer demand, there is increasing concerns that increases coming on January 1 will give shoppers pause, pinch retail margins and reverberate down to U.S. freight demand.
Did you know?
The National Retail Federation says 2018 holiday sales could range between $717.4 billion and $720.9 billion, representing growth rates of 4.3% and 4.8%, respectively, relative to 2017. Last year’s holiday sales were also particularly strong, rising 5.3% to $687.9 billion, the best growth since the U.S. exited its last recession.
Quotable:
“If you sat on your couch and ordered online, you should be ashamed of yourself because you just took one of my drivers to deliver it to you.”
-RoadOne IntermodaLogistics Chief Executive Ken Kellaway on the competition for commercial drivers from final-mile delivery services.
In other news:
China’s farmers innovate due to tariffs
But increased crop yield comes at expense of preserving small farms. (WSJ)
Oil price slump not signaling recession
World’s most traded commodity is instead suffering under weight of own fundamentals. (Barron’s)
Ocean carriers see short-term benefit from trade war
Rates remain robust through fourth quarter, but first quarter is very uncertain. (The Loadstar)
Montana trucking company fined $12.9 million
Fine stems from fraudulent hazmat bill of lading that resulted in explosion. (Sidney Herald)
Amazon got the prime end of New York in deal
Costs for Queens HQ2 deal may mean even bigger subsidy than outlined (Fast Company)
Final Thoughts
Even as container volumes surge to new levels, Port of Long Beach Executive Director Mario Cordero is shocked at suggestions that the second largest gateway for container shipments into the U.S. is congested. In an interview with FreightWaves, Cordero says the port is spending $4 billion in upgrading terminals, waterways and other infrastructure to ease movements of freight into Long Beach. “There have been no congestion issues. Absolutely not. This goes to preparation by this Port.” He acknowledges that some of the increase in port volume stems from the rush to beat tariffs into the U.S., and the start of increased tariffs could mean volumes fall once January hits. “If that was to happen, there would be an impact,” Cordero said. But he added “that the two countries, China and the U.S., will move toward a meeting of the minds. So there is optimism.”
Hammer down everyone!