THIS WEEK IN LOGISTICS
What we’re covering…
- How logistics operators in the US slashed nearly 17,000 jobs last month as e-commerce demand falls ?
- This week’s featured news stories, including CH Robinson considering a new CEO ??
- The European Union relaxing rules on tax breaks and benefits for clean-tech companies ♻️
- Logixboard’s featured content ?
IN THE NEWS
E-Commerce Slowdown Hits Logistics Companies With Nearly 17,000 Jobs Slashed In Feb 2023
Thanks to the COVID-19 pandemic-induced lockdowns, e-commerce companies experienced a significant surge in demand across 2020-21. Even in the first half of 2022, this demand continued to increase, with the first signs of a dip coming in slowly. In 2023, e-commerce demand seems to have fallen and plateaued, as consumers once again focus on the services sector. This evolving trend and inflationary pressures have pushed logistics companies to slow down too. In fact, logistics operators slashed nearly 17,000 jobs last month as consumer spending shifts to services from goods, and e-commerce growth stalls.
TOP HITS THIS MONTH
Featured blog posts
LOGIXBOARD INSIDER
Ready to drive revenue for your freight forwarding business this year? In our recent webinar “From Booking to the Warehouse,” we chatted with industry experts about how to create a winning end-to-end customer experience ??
Watch the recording to find out what strategies logistics professionals are using in today’s market ?
- C. H. Robinson, the largest US freight broker, is in advanced talks to name former United Parcel Service Inc (UPS) chief operating officer Jim Barber as CEO after the departure of Bob Biesterfeld.
- Spot rates for very large crude carriers (VLCCs) — tankers that carry 2 million barrels of oil — just breached the $100,000-per-day threshold. It could be a taste of things to come. Analysts and investors are increasingly confident that the tanker business is headed into a long, sustained upcycle.
- Amazon Air’s network shifts to FedEx, UPS’ hub-centric model according to a report. Between August 2022 and March 2023, Amazon Air’s domestic takeoffs and landings grew 2.8%, per the Chaddick Institute for Metropolitan Development’s report. However, US activity outside of its top hub at the Cincinnati/Northern Kentucky International Airport (CVG) fell by 1.5%.
- A Norfolk Southern (NS) train derailed around 6:45 AM on 9th March in Alabama, even as safety concerns were being discussed in the US Senate. This incident happened hours before NS CEO and president Alan Shaw was due to appear before the US Senate to testify about the derailment of one of the company’s trains in East Palestine, Ohio last month.
ON OUR RADAR
The European Union Passes Legislature To Compete With U.S. Clean-Tech Industry
Clean-tech has been an area of investment many governments and nations are focusing on, in line with the UN’s sustainable development goals and a general need for eco-friendly systems. The EU seems to have finally joined the bandwagon. The European Union is relaxing rules on government tax breaks and other benefits for clean-tech companies, part of an effort to prevent businesses from being lured to the US by new subsidies offered under the Inflation Reduction Act.
The EU’s highly awaited first move to counter the IRA’s impact was unveiled a day before European Commission President Ursula von der Leyen was set to meet President Biden at the White House for discussions centered largely on strained economic relations between the two allied economies. The Biden administration has also encouraged EU officials to increase support for clean-tech businesses.
The European Commission, the bloc’s executive body, said that it would allow governments to match the level of aid that is on offer in the US or another non-EU country if the projects meet certain criteria. The measure is meant to be used only in exceptional circumstances, the commission said, where investments might otherwise be diverted away from Europe. Other changes include increasing the value of certain subsidies that EU governments can offer without first seeking approval from the commission, and allowing for more money to flow to clean-tech companies that operate in less-wealthy regions of Europe.
Some of the new rules, including the matching-aid provision, will apply only to certain sectors of clean-tech manufacturing that the commission deems to be most at risk from Washington’s new subsidies. Those include the manufacturing of batteries, solar panels, and wind turbines, as well as the raw materials needed to make those products.
The change to EU subsidy rules comes amid concern that some companies could pause or slow down their investments in Europe in favor of moving more quickly to the US to take advantage of American clean-tech benefits. The changes announced by the EU are part of the bloc’s broader response to the IRA, which includes $369 billion in incentives and funding for clean energy. Some of the IRA’s benefits are contingent on a product being made or having its components sourced in the US or in North America, provisions EU officials have decried as protectionist. It remains to be seen just how clean-tech companies will actually benefit and what impact they will have at large.
