Logistically Minded: Report says autonomous trucks are 'inexorable'

Supply chains are constantly changing as new rules, technologies, resources and market trends transform operations. Here's a skim of the week's indexes, technology announcements, expansions and M&As from around the web

Market Snapshot

Manufacturers are enjoying a rare reprieve, as indices show rising global demand is reaching production lines around the world.

Industry Week reports favorable monetary policy, increased corporate investment and high consumer confidence is combining to boost manufacturing indices in the U.S., Japan and Germany. China's production may be stabilizing, but these three industrial powers appear ready to pick up the slack for global supply chains.

The spoils of economic growth are not limited to the industrial powers, however. Order books in the United Kingdom are at the highest level in almost three decades, according to The Guardian.

Back across the pond, 2018 seems promising for U.S. manufacturers after Congress passed a tax bill promising extensive cuts to bolster cash flow. The Wall Street Journal predicts the bill will make "2018 the year of the deal" as companies find uses for their cash.

The National Association of Manufacturers is similarly optimistic. Their latest Manufacturer's Outlook Survey shows the highest level of business confidence (94.6% positive) since the survey's launch two decades ago. In 2016, only 64.3% of respondents had a positive outlook on business, ThomasNet reports.

Technically Speaking

A new report for Business Insider Intelligence analyzes the development of autonomous truck technology and how it could affect the trucking industry, then discusses obstacles to the technology's implementation.

One big takeaway from the report is autonomous trucking technology (although a big investment) could cut costs for shippers and operators in the long run, as autonomous trucks take over more responsibilities from the driver and reduce inefficiencies.

BI Intelligence believes autonomous tech will be implemented slowly and in three stages: platooning, highway adaptions to autonomous trucks and then fully autonomous trucks (without a driver).

Probably the most interesting tidbit from the report is that BI Intelligence believes autonomous tech in the trucking industry is "inexorable." It's going to happen, whether regulators or some within the industry like it or not.

Even though legislators hesitating to set a regulatory standard for autonomous trucking tech is a persistent hiccup, this kind of predictive analysis could be valuable for owner operators, shippers and carriers investigating or investing in the tech in the new year.

Breaking Ground

A Vancouver, Canada-based online furniture store plans to open a distribution center in Jacksonville, FL, Jax Daily Record reported. The company, known as Article, currently has warehouses in Seattle, Los Angeles and New Jersey. The Jacksonville warehouse is more than 300,000 square feet and will nearly double the company’s warehouse capacity. With Jacksonville’s strategic location on the coast and in the Southeastern U.S., Article anticipates as many as one-third of its orders could eventually be shipped from the new warehouse.

In Alabama, APM Terminals and the Alabama State Port Authority have approved a massive expansion of the container facility in Mobile, American Shipper reported. The expansion is phase three of a five-phase project to increase capacity at the Port of Mobile. The project will cost nearly $50 million.

Meanwhile, construction is set to begin on a new cargo terminal at Moscow’s Sheremetyevo International Airport, according to The Loadstar. Cargo capacity at the airport is in high demand — volume has increased by 35% since August 2017. The airport’s chairman told The Loadstar he wants Sheremetyevo to become the leading hub in Europe for global cargo.

Mergers and Analysis

The trucking industry had a busy news week, with the ELD mandate going into effect on Monday.

A story that slipped a little bit under the radar was Wabco acquiring a stake in Nikola Motor Company. CCJ Digital reports Wabco has invested $10 million in Nikola, and in exchange, Wabco gains 1% equity stake. The two companies will reportedly collaborate on safety technologies for autonomous vehicles.

It may seem odd that a parts supplier wants to invest in a company primarily focused on design, but this deal could help put Wabco “at the forefront of breakthrough technology innovation,” Jacques Esculier, Wabco Chairman and CEO, said in a press release. For example, Nikola comes up with a design concept and goes to Wabco for development of the parts needed to execute that design. Over time, the partnership could give Wabco a real advantage as a supplier of parts for driverless and hybrid vehicles.

In other news, SiteOne Landscape Supply, a distributor of landscape materials, will acquire Pete Rose, which distributes natural stone supplies, MDM reported. Doug Black, the chairman and CEO of SiteOne, billed the acquisition as “a terrific fit.” This is SiteOne’s ninth acquisition of the year, according to Black.