With UPS Negotiations Underway, Teamsters Turn Attention to ABF

As the Teamsters and UPS turn their attention toward a new National Master Agreement, things are not looking quite so smooth at ABF Freight, the LTL subsidiary of ArcBest. In late May, the Teamsters at ABF voted to authorize a strike. While many industry experts see the vote as signaling Teamsters' seriousness as they enter negotiations with ABF, others are questioning the likelihood of a strike. But that’s not all that’s moving and grooving in the world of logistics this week: Postmaster General Louis DeJoy is pushing for more commercial clients, and pallet manufacturers are turning to sustainable practices to meet ESG demands. Here's what you need to know in the industry that’s always moving. 

Teamsters Authorize Strike at ABF Freight

Amid the ongoing national negotiations between the International Brotherhood of Teamsters and parcel carrier UPS, the Teamsters are reportedly preparing for a potential strike at carrier ABF Freight, the LTL subsidiary of ArcBest. The Teamsters at ABF Freight voted on May 24 to approve a strike at ABF Freight, a negotiating tactic that demonstrates the willingness of the Teamsters to strike if the need arises. 

“We are down to a handful of critical open issues.  It is our hope to reach a tentative agreement in time to have it ratified prior to the expiration of the current agreement and avoid a work stoppage,” Teamsters National Freight Director John A. Murphy said in a May 26 statement,  “The rank-and-file members at ABF showed their support for their negotiators by recently voting by over 97 percent in favor of authorizing a strike should it be necessary. Such strong support for the union negotiating team by the ABF members will undoubtedly help us get the best possible result.”  

Negotiations Continue Between UPS and the Teamsters

UPS and the Teamsters continue negotiating a new National Master Agreement ( NMA). The new agreement will represent 330,000 Teamster employees that work with U.P.S. In addition to the NMA, UPS and the Teamsters are also working on supplemental agreements, which govern contracts in specific regions of the country.

“We made good progress on key issues at the bargaining table this week,” UPS said in a May 26 statement, “We reached an agreement on several important issues for the Teamsters, our employees, and UPS—including operating priorities, the use of technology and in-vehicle cameras—and advanced discussions on many other topics.”

Supply Chain Digital Releases List of Top Air Freight Companies

On May 10, Supply Chain Digital released its list of the top 10 air freight companies. The list — which represents companies from around the globe — lists air freight carriers in order of their annual revenue. 

  • DHL Aviation: $20B
  • FedEx Express: $19.6B
  • UPS Airlines: $11.6B
  • Emirates SkyCargo: $5.8B
  • CargoLux Airlines: $2.5B
  • Cathay Pacific Cargo: $2.1B
  • Korean Air Cargo: $2B
  • Lufthansa Cargo: $1.9B
  • China Airlines Cargo: $1.5B
  • Singapore Airlines Cargo: $1.3B

Despite the impressive size of some air freight carriers, experts remain pessimistic about the overall air freight outlook. “If import/export activity grows, the likely beneficiary will be container shipping lines — not airlines,” reports FreightWaves. “Plus, an influx of capacity from restarted international passenger services, combined with weak demand, is weighing on rates.”

DeJoy Renews Push for Commercial Shippers in Year Three of Ten-Year Plan

As mail volumes continue to decline, the U.S. Postal Service, under the guidance of Postmaster General Louis DeJoy, is looking to bolster revenue by appealing to commercial shippers. In year three of Postmaster DeJoy’s much-touted ten-year transformation plan, shippers expect improved local delivery speeds and facilities. 

“I know that we can have a vibrant, thriving Postal Service that can realistically serve the needs of our stakeholders in a financially self-sufficient manner,” DeJoy said in a May 22 keynote address to the National Postal Forum. “Not by doing what has led to the tragic experiences of the past, but by finding new ways to serve and new ways to operate that benefit our mailing and shipping customers as we together serve the American public.”

Jump in Capacity Further Decreases Air Cargo Rates

In a blow to the already struggling air freight industry, an increase in air cargo capacity in April led to a further drop in spot rates. Overall air cargo capacity increased 7% YoY in April. In the busy Europe to North America trade lane, capacity increased by 26%. 

In an email to Supply Chain Dive, Niall van de Wouw, Chief Airfreight Officer at Xeneta, wrote, “This is a market that will test companies … This is a tremendous jump in capacity and, consequently, we saw a corresponding -12% fall in spot rates on these routes.”

Are Contracts the Next Frontier for the Digital Supply Train?

As the buzz around the digital supply chain continues to make its way around the transportation industry, one area, particularly, is seeing new attention from innovators: contracts. Smart contracts build upon the basic principles of contracting — negotiation and execution — and leverage digital technologies to invoke various contractual effects once specific parameters are met, all without human intervention. 

Despite the new attention given to smart contracts, some experts remain unconvinced. “You almost need a host of intermediaries to help you draft up that term sheet that is then turned into code,” said A.J. Zottola, co-chair of the Intellectual Property Transactions Practice Group at the law firm Venable LLP, in an interview with SupplyChainBrain, “It puts a lot of importance into making sure everybody understands what the conditions are that lead to a self-executing event.”

ESG Comes to Pallet Manufacturing

Throughout the global transportation industry and beyond, increased advocacy for ESG (Environmental and Social Governance) initiatives have led shippers to consider innovative ways to improve the sustainability of their supply chains. Increasingly, shippers are turning to pallets to enhance the sustainability of their supply chain, with pallet manufacturers seeing increased demand for flexible recycling and reusability in pallets, as well as increased debate over whether wood or plastic pallets are the most sustainable choice. 

Pallets “can become animal bedding, mulch, biofuel, wood pellets — which helps with our overall sustainability story as an offset for petroleum-based energy,” Jason Ortega, VP of Public Affairs at the National Wooden Pallet and Container Association, said in an interview with Supply Chain Dive, “The potential is there for the offsets to be greater than the embodied carbon to manufacture a pallet.”

In Response to Growing Demand, FedEx Announces Emissions Tracking Tool

FedEx is attempting to meet consumer demands as the call for more emissions transparency increases in the transportation industry and beyond. The carrier has announced plans to introduce a tool for shippers to gain detailed insight into the emissions produced by their shipments. FedEx Sustainability Insights® will be available for all U.S. packages from the carrier’s Express, Ground, and Freight branches. 

“We’ve heard from our shippers that they need more data on their shipping footprint as consumers increasingly weigh sustainability as a factor in purchasing decisions.” FedEx Executive Vice President and Chief Customer Officer Brie Carere said in a May 24 press release, “Through innovations like FedEx Sustainability Insights, FedEx is empowering customers to access the information they need as part of our mutual pursuit of a more sustainable future.”

Retail Sales Grew YoY in April

The U.S. Department of Commerce’s U.S. Census Bureau, in collaboration with the National Retail Federation (NRF), said April revealed some growth in the previously stagnant U.S. retail market. According to Logistics Management, “Commerce reported that April retail sales — at $686.1 billion — were up 0.4% compared to March and were up 1.6% annually. And from February through April, it said retail sales increased 3.1% compared to the same period a year ago.”

Blue Apron Sells Production and Fulfillment Facilities in Shift to Asset-Light Strategy

In announcing a shift to an asset-light business strategy, meal-delivery service Blue Apron said it plans to sell its production and fulfillment facilities to food manufacturer FreshRealm. Currently, FreshRealm manufactures BlueApron’s “Heat & Eat” line.

“As we continue to evolve, we believe there is an opportunity to simplify our direct role in the fulfillment of our product, allowing us to focus on growing our brand, our customer base, and revenue in the long term,” Linda Findley, Blue Apron’s President & Chief Executive Officer said in a May 16 press release, “We expect that this will allow us to focus all our efforts on providing even greater innovation and convenience to our customers as we remain at the forefront of culinary trends.”

Want to Stay Up to Date in a Fast-Moving Industry? Stay on the Cutting Edge Through a Partnership With Intelligent Audit 

In logistics, things move fast. It’s a struggle for today’s shippers not to get left behind. Intelligent Audit provides access to a robust toolkit of the latest supply chain innovations for shippers looking to stay on the cutting edge in today’s fast-paced transportation industry. 

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