In Case You Missed It

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• A few lessons from McCormick's push to centralize its supply chain.

Market Snapshot

The Trump administration was busy this week, moving the policy chains in ways that could transform the U.S. economy for years to come.

Much of it had to do with his nominees for major posts, such as the Export-Import Bank and the Federal Reserve. Senators heard testimony from Former Rep. Scott Garrett on his plans for the Ex-Im Bank on Wednesday, and on Thursday Trump officially nominated Jerome Powell to succeed Janet Yellen as the chair of the Federal Reserve.

On any other week, these two events would have moved markets. But this week, all eyes were on plans to officially release the Tax Cuts and Jobs Act, colloquially known as the tax reform. The House of Representatives introduced the 429-page bill Thursday afternoon.

The jury is still out as tax professionals, lobbyists and journalists pour over the document to understand both specific effects and the larger implications. Supply Chain Dive is still looking over it and speaking to sources to unearth insight, but here are a few sections that stood out at first glance:

• Sec. 3001. Reduction in corporate tax rate (to 20%). 
• Sec. 3101. Increased expensing (to 100%).
• Sec. 3406. Termination of new markets tax credit.
• Sec. 4102. Source of income from sales of inventory determined solely on basis of production activities. 
• Sec. 4303. Excise tax on certain payments from domestic corporations to related foreign corporations; election to treat such payments as effectively connected income. 

If you have any thoughts, or tips on sections we may have missed, we would welcome an e-mail to [email protected]. 

Technically Speaking

This week in tech, UPS announced it will install collision sensors and other tech into 60% of its fleet to help prevent accidents, DC Velocity reported. As UPS delivers more than 750 million packages this holiday season and other 3PLs including XPO continue to post record-breaking earnings borne out of business growth, delivery truck traffic will be heavy and so the tech arrives at a good time.

A new hard hat used by truck drivers delivering for BHP Billiton scans the wearer’s brain waves for signs of fatigue. The hat can warn drivers of fatigue, but also send data to supervisors so that they can intervene if necessary, Bloomberg reported.

In other news, a Vanilla Aircrafts diesel-fueled drone set a new record by flying for more than five days without touching down, according to ThomasNet. That’s a win for fuel efficiency, but as governments are pushing innovators away from gasoline and diesel and toward battery-powered engines, it’s still unclear just how much of a “win” it is for the future of unmanned flight

Breaking Ground

Amazon just nabbed a $3.9 million tax credit to help hire 1,000 workers for its new fulfillment center in Euclid, Ohio, due to the city's expectation that Amazon's prediction of an estimated $27.7 million in new annual payroll to the city by 2020, Cleveland.com reported.

Other big news includes the Port of Charleston’s announcement to dredge the harbor 52 feet, which would make it the deepest waterway on the East Coast, the Post and Courier reported. That means the Port of Charleston — which already handles high volumes of containers and ships — will be able to handle even more, perhaps giving the southern port a sharper competitive edge over the Port of New York/New Jersey.

Mergers and Analysis

When two companies merge, much of the attention falls on the "synergies" the businesses can achieve.

Amazon and Whole Foods, for example, boasted of Whole Foods' new access to data and Amazon's gain of a brick-and-mortar presence. But, mergers can also have a host of negative effects on companies, not the least of which is service disruptions.

This week, Supply Chain Dive reported on SeaIntel's newest ocean carrier reliability rankings. American Global Logistics' Jon Slangerup reminded us not much changed from last year. But, will that continue to be the case as many of the top-performing companies merge with less-reliable carriers?

As an example, the data shows OOCL is the most reliable carrier, but will this remain true when the line merges with COSCO? 

So far, reliability is declining, SeaIntelligence Consulting CEO Lars Jensen wrote on LinkedIn. "Reliability is seen to decline for the 3rd consecutive month and at just over 72% is the lowest level seen in 6 years in the month of September." At the same time last year, reliability sat at 85%.

Part of it may have to do with the restructuring of ocean alliances. Responding to a question on the topic on his LinkedIn post, Jensen adds participating in an alliance means reliability is really "one for all and all for one."  Meaning, if one allied member suffers, all would.

The question is whether the inverse is opposite. UASC completed its merger with higher-ranked Hapag-Lloyd earlier this year, and yet it remains the third-least reliable shipping line, The Loadstar reports.