As the Teamsters duke it out with UPS, a new fight between the union and another major carrier — DHL — is taking shape in Cincinnati. But they’re not alone: the International Longshore and Warehouse Union made its presence known last week, according to the Pacific Maritime Association, with what the carrier group has deemed an illegal work stoppage. As workers and bosses vie for control of the narrative, we’ve rounded up the transportation industry stories making headlines in the industry that’s always moving.
In a blow to shippers' hopes of a quick resolution to the negotiations between UPS and the Teamsters, union leaders announced they wouldn’t enter talks over a national contract until they’ve finalized regional agreements.
In a press release, Teamsters General Secretary-Treasurer Fred Zuckerman said, “It’s up to UPS to get its act together, show up, and do right by its workforce. Until then, there will be no negotiations on a national contract.”
According to the Pacific Maritime Association, the powerful industry group representing carriers and terminal operators in the high-profile West Coast labor negotiations with the ILWU, the work stoppage on April 6-7 at the ports of Los Angeles and Long Beach constituted an “illegal work action,” per reporting from Supply Chain Dive.
According to previous statements from the ILWU, union representatives have long said planned stoppages — including lunch breaks and religious holidays — occur under existing contract terms. The dispute comes as the ILWU and PMA attempt to negotiate a master contract for West Coast port workers, an ongoing process since the previous contract expired on July 1, 2022.
Already embroiled in tense negotiations with UPS, the International Brotherhood of Teamsters is taking up another challenge: attempting to unionize 900 workers at the DHL Global Express Hub at the Cincinnati/Northern Kentucky International Airport in Hebron, Ohio.
In response to being told of alleged mistreatment of workers by managers at the DHL Global Express Hub, in which a manager referred to employees as “inmates,” a DHL representative said, “At the DHL Express Cincinnati (CVG) Hub, we prioritize treating our employees with the utmost respect,” adding, “We deeply value the rights of our workers and always prioritize their safety and welfare, not just at our Hub but in all of our operations.”
In a shift from the previous policy, Amazon has started charging customers a fee for some returns made to The UPS Store locations – if there is another alternative within the same distance or closer to the customer’s delivery address. Options include Amazon Fresh, Whole Foods, and Kohl’s locations.
For Amazon, which has seen a significant decline in sales following the pandemic era, the decision to begin charging for returns at UPS stores underscores the e-commerce giant’s need to bolster revenues.
The nation’s two largest parcel carriers – FedEx and UPS – are trying an innovative approach to pricing as they attempt to improve operational efficiency in the face of plummeting parcel volume: dynamic pricing. This move toward dynamic pricing comes after both carriers raised delivery surcharges the previous year, a controversial move that sent some shippers searching for competitors.
Dynamic pricing takes factors such as package size, weight, and distance to adjust prices in real time, limiting the amount of time given to allocation and allowing the carriers to make the most of their capacity.
As Amazon continues to compete for the last mile, the e-commerce giant’s latest strategy refocuses on regional performance. In a letter from CEO Andy Jassy to Amazon shareholders, the company “made significant internal changes (e.g., placement and logistics software, processes, physical operations) to create eight interconnected regions in smaller geographic areas,” according to reporting from Supply Chain Dive.
This refocusing marks a notable strategy shift for Amazon, which invested significantly in expanding warehouse operations throughout the pandemic. With the pandemic demand boom now a distant memory, it’s up to Amazon to adapt.
For years, proponents of sidewalk delivery robots have been looked at with a healthy dose of skepticism. But is that same skepticism still applicable post-pandemic? For Ali Kashani, co-founder and CEO of Serve Robotics, the answer is a resounding no, with much of his reasoning rooted in the persistent labor shortage plaguing the transportation industry.
“After COVID, you had challenges with labor,” Kashani told Supply Chain Dive, “Then you had inflation and the cost of labor going up, and then you have the cost of gas going up. Every one of these things that have happened has become a tailwind for us.”
The Environmental Protection Agency, already targeting heavily polluting trucks, recently announced new regulations that expand those efforts to include truck manufacturers. The aim is to lower the emissions produced by heavy-duty trucks, beginning with the model year 2027, an acceleration of the Biden Administration’s plans to move toward a decarbonized supply chain.
Despite the EPA’s actions, some in the trucking industry expressed skepticism around the new regulations: “While these standards are directed at manufacturers, it is fleets — the customers and end-users of this equipment — who will ultimately determine their level of success,” said American Trucking Associations CEO Chris Spear, according to reporting from Transport Dive.
As fears of an economic downturn persist, analysts point out worrying trends. Metsa Board, a European paperboard and pulp manufacturer, recently released its first negative profit warning in four years. The announcement was a strong indicator a downturn is likely in consumer goods, which rely on packaging from companies like Metsa Board. Adam Josephson, writing for FreightWaves, noted that pulp is “demonstrably economically sensitive, and the global economy is suffering.”
On Wednesday, April 12, federal law enforcement officials arrested nine individuals with ties to a plot to defraud Polar Air Cargo. Those involved had defrauded Polar Air Cargo, a partial subsidiary of DHL, of millions of dollars over 10 years. According to FreightWaves, federal officials said that “the “pervasive corruption” cost Polar Air Cargo $52 million and touched nearly every aspect of the airline’s business between 2009 and July 2021.”
Among those involved are four former executives, including former COO Lars Winkelbauer, who worked at Polar Air Cargo until 2021.
As a sign of market stabilization, the retail per-gallon cost of diesel fuel has returned to levels not seen since before Russia invaded Ukraine in late February 2022.
According to reporting from FreightWaves, “The benchmark Department of Energy/Energy Information Administration average weekly retail price fell to $4.098 a gallon Monday, a decline of 0.7 cents a gallon. With that move, the price is now less than where it was on Feb. 28, 2022.”
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