enroute
Glazer, director of global social and
environmental responsibility at HP.
HP’s own efforts to harvest that
low-hanging fruit have extended
beyond its packaging redesign. The
electronics company has also made
changes to its distribution operations
that will help conserve fuel. For
instance, the high-tech giant, which
each day ships more than 1 million
products worldwide, says on its Web
site that it has expanded its use of
plastic pallets, which are 70 percent
lighter than traditional wood pallets
and which cost less to ship. (The
company did not provide specifics on
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the extent of the initiative.)
HP has also re-jiggered its distribution
network to reduce fuel consumption,
according to its Web site. For instance, last
year, the company restructured its operation so that Chinese-made inkjet printers
imported through the Port of Long Beach,
Calif., are received at a DC on the U.S. West
Coast rather than in Memphis, Tenn.,
where they were handled in the past. The
net effect has been to reduce vehicle miles
traveled from the port of entry to the distribution point for the shipments.
Calm before the storm
HP, Lowe’s, and Kohl’s are hardly alone.
Following last year’s unprecedented oil
price run-up to $147 a barrel in July
(which was followed by an equally violent
collapse to the $30-a-barrel level), interest
in fuel-saving initiatives has been running
high. Although oil prices have now settled
into a trading range of between $60 and
$70 a barrel, the transportation community remains wary. And many companies
appear to be moving proactively to at least
mitigate the damage from higher future
oil prices while the current environment
remains reasonably benign.
Last year’s oil shocks exacted a particularly heavy toll on asset-based service
providers. Truck fleets spent $151 billion
on fuel in 2008, a whopping $36 billion
increase from 2007 and more than double
the amount spent in 2004, according to
the American Trucking Associations.
Although diesel prices today stand at
about $2.50 a gallon, almost 50 percent
below the all-time high of $4.76 a gallon
recorded in July 2008, carriers haven’t forgotten last summer’s pain at the pump. Like
their shipper customers, they’re taking
advantage of what some believe is the calm
before the next oil price storm to put fuel
conservation initiatives in place.
For example, 3PD, a Marietta, Ga., company that provides pickups and “last mile”
deliveries from retail stores and distribution centers to consumer residences, has
refined its transportation model to limit
the distance between pickup and delivery
points on the average route to no more
than 12 miles. Prior to last year’s fierce
run-up in oil prices and the subsequent
economic downturn, the average distance
