DC Velocity - July 2018

newsworthy

24 DC VELOCITY JULY 2018 www.dcvelocity.com
CFI, a North American full-truckload carrier and subsidiary
of TFI International Inc., has accelerated its fleet modern-
ization program by upping its order for Kenworth T680
over-the-road long-haul tractors from 500 to 600. Delivery
of the additional 100 tractors is expected by year’s end. …
Freight and parcel services provider Purolator, electronic
logging device-maker Konexial, asset-light logistics service
provider Roadrunner Transportation Systems Inc., and
freight forwarder/third-party logistics service provider
RIM Logistics Ltd. have joined the Blockchain in Transport
Alliance (Bi TA), a consortium created to develop standards
for the use of blockchain technology in the transportation
industry. … Dematic, a supplier of automated technology,
software, and supply chain services, has confirmed that
former Secretary of State Gen. Colin L. Powell will be the
featured keynote speaker for its 2018 Material Handling
& Logistics Conference. The event takes place in Park City,
Utah, Sept. 9–12. … Saddle Creek Logistics Services has
released a new study titled “Ready or Not: Omnichannel
Fulfillment & Distribution.” The research, which was
conducted among manufacturers, retailers, e-commerce
companies, wholesalers, and distributors, explores how
companies are handling omnichannel fulfillment and
distribution today as well as their plans for the future.
… Icat Logistics Inc. has broadened its presence in the
Cincinnati area with a new office in nearby Edgewood,
Ky. … BDP International, a privately owned logistics and
transportation solutions company, has opened its first
location in Dublin, Ireland. … Supply chain services and
technology solutions provider Seldat Distribution Inc. has
achieved its certification as a U.S. Customs bonded carrier
and is licensed by U.S. Customs and Border Protection to
carry duty-unpaid goods. … Material handling equipment
maker Kion North America has celebrated the completion
of its new 1.0-megawatt solar energy system, which will
power its Summerville, S.C., plant while also generat-
ing revenue for the company. … Old Dominion Freight
Line Inc. opened five new service centers in the second
quarter, expanding the less-than-truckload carrier’s U.S.
network to 230 locations. The new centers are located in
Bowling Green, Ky.; Casper, Wyo.; Lakeland, Fla.; Ogden,
Utah; and Parkersburg, W.Va.
short takes

With the Trump administration’s tariffs on steel and aluminum imports in effect, some have voiced concern that the policy could dent the sales of steel-intensive material handling products such as racks and shelving. However, any potential decline in investments in material handling equipment (MHE) will likely be muted by the tremendous demand for warehouse equipment driven by the fast growth of e-commerce sales, one expert said.

The administration has levied a 25-per- cent tariff on steel and a 10-percent tariff on aluminum imports from the European Union, Canada, and Mexico, saying the move addresses U.S. national security concerns. The administration argued that an oversupply of imports would result in more domestic plant closures, thus hindering the country’s ability to rely on domestic sources in the event of a national emergency.

Some in the business community believe that rationale
is flawed. They have voiced fears that tariffs could trigger
repercussions across the U.S. economy, forcing steel and
aluminum users to raise their prices to cover the higher
costs of raw materials. The impact could be particularly
strong for providers of material handling equipment such
as warehouse rack and shelving products, whose prices are
directly influenced by the cost of steel, Paul Huppertz, a
director at London-based management consulting firm
Crimson & Co., said in an e-mail. It could also have a
lesser impact on lift trucks, conveyors, and other types of
automated warehouse equipment, forcing
additional price hikes, Huppertz said.
Yet the overall hit is unlikely to be
severe, Huppertz said. “As far as impact
on growth and investment, I don’t see it
making a big dent,” he said. “There will
be some projects that fail to be approved
since the higher cost exceeds the expected
benefit. But the bigger projects, especial-
ly in this e-commerce-fueled boom, will
likely continue.”
Pallet-rack products will probably see the biggest impact
in unit cost compared with other categories of MHE, but
racking is not usually the “big ticket” cost item in a new
DC or expansion project, he said. “Bottom line, the price
increase will dampen demand for MHE slightly, but strate-
gic business drivers and expansion of digital channel capa-
bilities will continue to be hot,” Huppertz said.