Resource Center/Article03/18/2021

Carriers Delayed by Winter Storms, but Technology Innovations Just Around the Corner

Carriers delayed by winter storms, but process optimizations and tech innovations are just around the corner.

PARCEL CARRIER NEWS

FedEx struggles with delivering on time due to winter storms, $2 billion invested in making carbon-neutral operations, and redirect FedEx’s postal business into its own network.
  • Due to winter storms hitting the Memphis, TN hub mid-February, FedEx has experienced major delays in package deliveries weeks after. To try and get back on track FedEx has added extra shifts and staffing and says normal services will be back and running by the end of the week.
  • FedEx plans to invest a starting amount of $2 billion to go carbon-neutral by 2040. They plan to do this by using vehicle electrification, sustainable energy, and carbon sequestration. By the year 2025, half of FedEx Express global pickup-and-delivery vehicles will be electric and ecofriendly.
  • FedEx has moved away from the U.S. Postal Service for the last-mile delivery operations and has redirected its postal business inward. The rebranded service is called FedEx Ground Economy from FedEx SmartPost.
Carol Tomé, UPS boss, speaks about the power of no and moves Asia-Pacific PR duties to Zeno.
  • During the COVID-19 pandemic, Carol Tomé took charge of the United Parcel Service Inc. after being the finance chef of Home Depot Inc. She became the first outsider to lead UPS and has created an exceeding demand for their services by using the power of one single word, which is no.
  • Following a competitive review that was held in late 2020, logistics mogul UPS has moved Asia-Pacific PR duties to Zenoafter almost 19 years of partnership with Ogilvy. Kara Ross, UPS president of international communications, digital and executive affairs said, “We are excited to work with Zeno to cement UPS’ status as a global logistics provider moving our world forward by delivering what matters.”

GRI & SURCHARGES

  • FedEx
  • FedEx has officially rebranded SmartPost as FedEx Ground Economy. According to the terms and conditions for FedEx Ground Economy, customer contracts for SmartPost are valid and active despite the renaming. The published list rates and fees for FedEx Ground Economy are the same as SmartPost.

LTL CARRIER NEWS

  • 2020’s rapid growth of e-commerce continues to impact the LTL industry much the same as the Parcel industry. “Shippers need to brace for stiff rate increases as more disciplined carriers benefit from tight capacity, lack of drivers, new market concentration and mounting COVID-related demands.”

SHIPPING INDUSTRY TRENDS

  • Volkswagen vehicles and Hermes launch parcel delivery voice assistant project with the help of tech startup Neohelden to aide with parcel deliveries in the UK. The voice assistant features are drivers will be able to see and hear what is coming up next during their rounds, have all orders to hand displayed as a list, and be able to select the next delivery by touch or voice command. Along with that, the voice assistant can read out all the relevant details about the delivery and specific requests if there are any.
  • Polestar has reimagined the way we do last-mile deliveries in cities by designing a vehicle that resembles a three-wheeled urban ‘sled’ to move away from combustion engines. This vehicle is in a category of its own because its compact and mobile enough for bike lanes but able to handle 275kg payload.
  • Drones are now being used to solve the last-mile delivery problems with faster, lower-cost, more convenient delivery, reduce CO2 emissions and increase the overall safety of the transport system.
  • Robots are now being used as a way of being cost-efficient and flexible throughout Europe. There are two different types of models which is a fixed tilt-tray and crossbelt conveyer-based sortation system.
  • Fuel Trends
    • Current Price (⬆︎): February $62/b up 14.8% from January. Brent prices rose in February in anticipation of increased demand as vaccination rates and global economic activity increased; coupled with lower supplies from OPEC and crude disruptions from winter weather (Texas).
    • Supply (⬆︎): April Production 25.3M b/d. EIA expects OPEC crude oil production will rise to 26.6 million b/d in May. This increase reflects Saudi Arabia ending voluntary cuts of 1.0 million b/d, along with the relaxation of cuts that were extended through April at the March 4 OPEC+ meeting.
    • Demand (⬆︎): February Consumption 95.9M b/d. EIA forecasts that global consumption of petroleum and liquid fuels will average 97.5 million b/d for all of 2021, which is up by 5.3 million b/d from 2020. EIA forecasts that consumption will increase by another 3.8 million b/d in 2022 to average 101.3 million b/d.
    • Price Forecast (⬇): March & April $65/b to $70/b Average. EIA continues to expect downward crude oil price pressures will emerge in the coming months as the oil market becomes more balanced. Brent crude oil prices in the forecast average $58/b in the second half of 2021.
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