newsworthy
ing on double-stack service is already low and doesn’t provide
enough financial incentive to operate on expedited schedules.
“There have never been premium-priced … stack trains,
although many customers have requested them,” the executive said.
“Running such a train for UPS would break the pricing precedent
and therefore, the [railroads] may have to provide premium con-
tainer services for other container customers.”
A spokesman for the Burlington Northern Santa Fe Railway,
which handles large quantities of UPS intermodal shipments,
declined comment.
The executive said such a shift “would hasten the demise of trailers in the marketplace along with the obsolescence of large numbers of intermodal trailer cars not yet fully depreciated.” Faster train
speeds would also put double-stack services in closer competition
with truckload services in the fast-growing domestic intermodal
marketplace, the executive added.
Containers already dominate the U.S. intermodal landscape. In
2010, containers accounted for 11. 7 million of the 13. 4 million
intermodal units handled by the railroads, according to the
Intermodal Association of North America. Trailers accounted for
the balance.
It is unclear if UPS will own the double-stack containers it has on
order or if it will lease them. UPS currently owns its own assets and
as a result, avoids the supply problems associated with relying on
leased equipment.
There have been reports of container shortages in the United
States due to production backlogs in China and “slow steaming”—
the practice of reducing steaming speeds—by vessels sailing from
Asia to the United States, a process that conserves bunker fuel but
also keeps containers on the water for longer periods. ;
—Mark Solomon
Double-digit gains seen for
3PLs in 2011
Gross revenue for U.S. third-party logistics
service providers (3PLs) is expected to
exceed $141 billion in 2011, an increase of
approximately 10 percent over 2010 levels,
according to estimates released in mid-May
by consultancy Armstrong & Associates Inc.
For 2010, gross revenue for the 3PL industry exceeded $127 billion, an 18.9-percent
increase from 2009 levels, which brought
the industry back up to about where it was
in 2008, Armstrong said. Revenue in reces-sion-plagued 2009 dropped by 20 percent
from 2008 levels, the only period when revenues declined on a year-over-year basis
since the survey began in 1995, the
Stoughton, Wis.-based consultancy said.
Of the four industry segments that
Armstrong tracks, international transportation management performed the best in
2010, with a 30.1-percent increase in gross
revenues. The strength in the segment correlated with a 12.4-percent year-over-year gain
in world trade volumes, Armstrong said.
Revenues and profitability increased in
2010 in all four 3PL segments, Armstrong
said. Net revenues, defined as gross revenue
minus purchased transportation, were up
13. 2 percent. ;
short takes
The American Logistics Aid Network (ALAN) has been
awarded two sizable grants: $25,000 from The UPS
Foundation and $50,000 from the Regional Catastrophic
Preparedness Grant Program, Project on Supply Chain
Resilience. Funds will be used for a new initiative to auto-
matically identify potential donors with the resources to
address specific relief needs. … In other ALAN-related news,
Aspen Logistics Inc. has recently joined the initiative. Aspen
Logistics, ALAN, and the California Department of Public
Health are working together to find a home for California’s
disaster relief supplies. … Crown Equipment Corp.’s elec-
tronics manufacturing plant in New Bremen, Ohio, has
achieved zero landfill status. … Inttra, a provider of e-com-
merce solutions for the ocean freight industry, has formed an
Ocean Freight Industry Electronic Invoice Presentment and
Payment Standards Advisory Board. Industry executives rep-
resenting more than a dozen leading ocean carriers and
global freight forwarders signed a charter to participate in
the initiative. … Global third-party logistics service provider
Longistics has joined a coalition of public- and private-sector
groups in launching the N.C. China Global Gateway Platform
for Investment and Economic Development, a public-private
partnership to promote job creation and trade in North
Carolina and China. … The Institute for Operations Research
and Management Sciences (INFORMS) has established the
annual UPS George D. Smith Prize for operations research.
The prize will recognize the practical importance of opera-
tions research, while honoring academic leaders who
embody the beliefs of Smith, the second CEO of UPS. …
Ocean World Lines, a global non-vessel operating common
carrier, is helping apple growers in Washington’s Yakima
Valley increase their export business.
