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United Auto Workers Strike Continues with Threats to Expand, USPS Says no Peak Season Delivery Surcharges, NS and CN Begin Joint U.S.-Canada Intermodal Service.

Sep 21, 2023

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Container lines adding blank sailings for low Golden Week holiday demand. The latest Sea-Intelligence report suggests that with the upcoming Golden Week holiday in Asia during early October, shipping lines are adjusting by canceling sailings to align supply with lower demand, as factories close and container demand to/from Asia decreases. There are 29 extra canceled sailings on the Transpacific and 18 more on Asia-Europe routes. Sea-Intelligence’s report shows that planned capacity reductions have increased significantly: from 3.7% to 14.1% on Asia-North America West Coast, from 2.2% to 16.1% on Asia-North America East Coast, from 6.8% to 19.9% on Asia-North Europe, and from 7.7% to 21% on Asia-Mediterranean. Alan Murphy, CEO of Sea-Intelligence, said that “carriers are now on track to blank capacity in line with both 2019 and the 2017-2019 average.”


Port of LA sees cargo growth while Long Beach volumes dip. The Port of Los Angeles saw a 3% year-over-year increase in cargo volumes in August, marking the port’s first monthly YOY increase in 13 months. Loaded imports increased by 7% and loaded exports increased by 22%, while empty containers declined by 10%, according to gCaptain. Meanwhile, cargo volumes at the Port of Long Beach fell 15.4% YoY to 682,312 TEUs in August, marking almost a year of consecutive volume declines at the port.


United Auto Workers strike continues with threats to expand. Industrial action being billed as “the biggest auto strike in generations” began last week for 150,000 US autoworkers, with employees at Ford, Stellantis and General Motors walking off the job at 11:59 pm after contract negotiations failed to reach a deal. This week, the United Auto Workers union is placing pressure on Detroit’s Big Three by threatening to expand its strike unless it sees “major progress” in contract negotiations by Friday, according to AP News.

USPS says no peak season delivery surcharges. The U.S. Postal Service will not impose any parcel-delivery surcharges during the upcoming peak holiday delivery season for the first time since 2019. According to postal officials, the agency can avoid surcharges because its peak costs will not be as high as in years past. The Postal Service has also added 10 million parcels’ worth of daily processing capacity since last peak, bringing its daily capacity to 70 million parcels, according to FreightWaves.


NS and CN begin joint U.S.-Canada intermodal service. Norfolk Southern and Canadian National are launching a new joint intermodal service that connects several markets in Canada with hubs in the central and southeastern U.S. beginning on Oct. 2, according to a news release. The service connects several Canadian National-served markets across Canada — including Toronto, Montreal, Calgary, Edmonton, Vancouver and Winnipeg — with Norfolk Southern hubs in Kansas City and Atlanta. “Designed with customer-centricity top of mind, [the new service] simplifies their processes, enabling smoother rail shipments between Canada, Kansas City, and Atlanta,” Norfolk Southern President and CEO Alan Shaw said in a statement.


Freighter aircraft orders continue to decline. Aerospace firms specializing in passenger-to-freighter conversions are producing a record number of units this year. However, new and aftermarket aircraft demand has been impacted by reduced international freight and e-commerce orders. Airfreight demand has fallen 8% to 10% since spring 2022 due to a slowing global economy, inflation, high retail inventories, and resolved shipping backlogs. Increased cargo capacity from international passenger flight resurgence has caused a 45% drop in freight rates and reduced airlines’ cargo revenue, with dedicated cargo aircraft activity down 4.5% on average over the past year, according to BMO Capital Markets.

Air Belgium stops passenger flights to focus on cargo operations. Air Belgium has decided to discontinue its own passenger business and focus exclusively on “cargo and ACMI for passenger and cargo flights” due to economic challenges. The airline said in a press release on September 18 that its passenger business “in the face of increased competition is proving to be chronically unprofitable to date” and that these factors combined caused financial challenges which are “forcing Air Belgium to change its strategy,” according to AirCargoNews.


Data shows Mexico is the top U.S. trade partner. Mexico was the top U.S. trade partner in July, with trade totaled at $65.3 billion—a 0.24% increase compared to the previous year, marking the seventh time in the past eight months that Mexico held the top position in monthly U.S. international trade, according to the most recent data from the U.S. Census Bureau. Year-to-date, Mexico’s trade with the U.S. stands at $462 billion, surpassing Canada at $450.3 billion and China at $322.3 billion.

Vietnam approves inland container depot investment. The Vietnamese government plans to invest $1.7 billion by 2030 to expand inland container depots (ICDs). This move, outlined in the 2021-2030 ICD Development Plan with 2050 Targets approved by Deputy Prime Minister Tran Hong Ha, aims to meet import and export needs, lower logistics costs, reduce port storage times, enhance handling capacity, and ensure cargo safety. By 2030, ICDs in Vietnam are projected to handle 17.1 million TEUs annually, up from the current 11.9 million TEUs, meeting 25% to 35% of export and import container shipping demand.


Over 300 Apple suppliers have committed to clean energy usage. Over 300 of Apple’s manufacturers have pledged to achieve 100% clean energy usage in their production for the tech giant. This commitment, made under Apple’s “Supplier Clean Energy Program,” now encompasses 90% of the company’s direct manufacturing expenditure, following recent commitments from over 50 additional producers. Apple’s announcement shows significant progress toward its objective of achieving carbon neutrality across its products, global supply chain, and the lifetime use of its devices by 2030. Additionally, Apple is targeting a 75% reduction in total carbon emissions by the year 2030.