Management Update

An executive summary of industry news

By Staff -- Logistics Management, 4/1/2006

• U.S. and Canadian Class I railroads will spend $8 billion on improvements in 2006, according to the American Association of Railroads (AAR). Chief among those improvements are laying new track, buying new equipment, and making changes to railroad infrastructure. That represents a 21 percent uptick from 2005 and is based on numbers provided to the AAR by each Class I railroad. The trade group says that anticipated traffic growth is behind the increase in investments.
• The American Trucking Associations goes to bat for the FMCSA. The ATA filed a motion to intervene in Public Citizen's most recent challenge to the Federal Motor Carrier Safety Administration's hours-of-service (HOS) rules. Public Citizen's previous petitions had contested the rules' 11-hour daily driving-time limit, 34-hour restart, and failure to mandate electronic on-board recorders. The ATA said in a statement that its brief supports those aspects of the HOS rules, which it believes "advance public safety while meeting the operational needs of the trucking industry." Since the FMCSA issued revised rules for commercial drivers earlier this year, there's been a considerable amount of negative feedback. (See "Controversy continues over HOS sleeper-berth ruling" in our March issue, available at www.logisticsmgmt.com.)
• Another round of changes has been handed down for C-TPAT, the Customs and Border Protection (CBP) security program. Last month the agency issued final rules for minimum security requirements for importer, ocean carrier, and motor carrier members of the Customs-Trade Partnership Against Terrorism. Importers have 60 days from March 25 have to comply with specific requirements for physical security; 120 days for personnel, internal procedures, and information security; and 180 days for business partners' security practices. Motor carriers have the same phased plan, with a start date of March 13. Ocean carriers, meanwhile, have 90 days from March 1 to comply with the new requirements. Specifics are available online at www.cbp.gov.
• Learn about logistics without leaving your desk. The Council of Supply Chain Management Professionals (CSCMP) has teamed up with Accenture's Supply Chain Academy to launch CSCMP University, a series of online self-study courses. The 41 courses, grouped at basic, intermediate, and advanced levels, cover such topics as finance, metrics, procurement, and supply chain planning. Courses are offered individually and prices vary. For more information or to register, go to www.cscmp.org.
• And the Port Person of the Year Award goes to ... Senator Susan M. Collins, Republican of Maine, was named "Port Person of the Year" by the American Association of Port Authorities (AAPA) at its annual Washington People's Luncheon last month. The AAPA, a trade organization representing public ports in the Western Hemisphere, selected Senator Collins to receive the award based on her advocacy in Congress for increased security at U.S. seaports.
• After eight months, PierPass has raised its rates. Effective April 3, the traffic- mitigation fee paid by shippers that move containers through the ports of Los Angeles and Long Beach during peak traffic hours will increase to $50 per 20-foot container and $100 per 40-foot container. That's up $10 and $20, respectively, from the original fee. The increase is needed to cover the actual cost of the program, said PierPass President and CEO Bruce Wargo. The non-profit arm of LA/LB container terminal operators aims to reduce daytime traffic congestion at the two ports. During the first six months of the program, 30 to 35 percent of all daytime movements shifted to off-peak night and weekend hours—nearly double the amount expected.
• Return to sender. Parcel Return Service (PRS), a United States Postal Service pilot program for returned merchandise, became a permanent fixture as of April 2. PRS allows approved merchants and parcel consolidators to pick up items that their customers have returned at a Post Office delivery unit or Bulk Mail Center. Customers place a preprinted, postage-paid PRS label on the package to be returned; they then give it to a letter carrier, drop it in a collection box, or bring it to a Post Office. The service is convenient for consumers and saves both the merchant and the USPS money, says the postal service.
• Driver error is 10 times more likely to cause accidents involving large trucks than other factors, including weather, road conditions, and vehicle performance. That's according to a study conducted by the Federal Motor Carrier Safety Administration (FMCSA) and the National Highway Traffic Safety Administration (NHTSA). The Large Truck Crash Causation Study examined pre-crash factors for 967 collisions in 17 states; researchers found that action (or inaction) by the driver of either the truck or the other vehicle involved was the primary cause of 88 percent of those accidents. The American Trucking Associations said the data support the group's belief that passenger car drivers are most often at fault in accidents involving large trucks.
• Mergers and acquisitions in the mail, express, and logistics sectorshave reached their highest level since the "dot-com" boom, says analyst firm Transport Intelligence in its new report, Global Logistics Strategies 2006. One reason for the increase in M&A activity, said Chief Analyst John Manners-Bell, is a significant rise in "e-tailing" volumes. And the fact that international freight shipments—driven largely by the soaring Chinese economy—are at an all-time high has prompted a resurgence in interest in freight forwarders, he said. For more about the report's findings, go to www.transportintelligence.com.
• If changing trade rules are keeping you on your toes, consider attending the American Association of Exporters and Importers' 85th annual conference and exhibition June 11—13 in New York. This year's theme is "The New Global Challenge: Seamless Security and Trade Facilitation." Speakers include government policymakers, trade attorneys, and trade-compliance executives from some of the country's largest importers and exporters. For more information, go to www.aaei.org.
• Truck tonnage is down for the first time in six months. After five consecutive months of growth, the American Trucking Associations' seasonally adjusted Truck Tonnage index fell in February to 115.1, its lowest level since September 2005. That was the largest month-to-month decline in a year. Bob Costello, ATA chief economist, told Logistics Management that he expects moderate growth in the index overall, but there will likely be months when tonnage is down. The index is considered to be a good indicator of the overall strength of the U.S. economy.
• We're glad someone thinks logistics is sexy. That someone is Anthony Sosnick, a New York City entrepreneur who has launched the "Anthony Logistics for Men" line of personal care products. A percentage of the proceeds from the allergy-tested products goes to charities that are working to prevent and cure prostate cancer. For more information, visit www.anthony.com.
• Meet the new Wednesday Edition. LM's weekly eNewsletter has a new name, This Week in Logistics, but it still brings you the same timely and relevant news updates as always—straight to your inbox every Wednesday. Three additional, monthly eNewsletters keep LM readers plugged in to the logistics world around them. Read about the latest in technology in Logistics Technology and RFID Report, get up-to-date news about transportation prices with Pricing Trends, and see what's in store in LM's print edition in Logistics Preview. Visit www.logisticsmgmt.com to sign up for This Week in Logistics and our other free eNewsletters.