Transportation - Supply Chain problem - why
 

I didn't want to derail the heirloom thread.

Why do we have a transpo problem, especially the local trucking portion of it?

The shipping to/from China, I can maybe kind of see, but I don't understand why there would be a problem with trucks and truckers in the continental US. That's got to be one of the most Covid friendly jobs there is. Pretty limited interaction with others.

A couple of reasons I heard were that a lot of truckers quit/found something else to do last year when transportation needs tanked during the early months of the pandemic. And, somewhat in conjunction, a lot of truckers are older white guys and they decided to retire during those times and there's not a huge influx of young guys (or women) joining the ranks... So...shortage in truckers. Especially those with certs (I forget the term) to drive tankers, hazmat stuff, things like that.

There are many layers of this onion to peel back for the answers . In a nutshell I see two basic reasons for supply chain issues . Every port in America has a huge backlog of container ships waiting to be offloaded . The reason for the backlog is not enough available/trained workforce
to unload the ships .

Secondary but just as important is the lack of trained and skilled OTR drivers . The days of the average Joe just climbing behind the wheel and driving is mostly gone . There are many state and federal rules and regulations to adhere to and many need to be either logged or reported daily . So a driver needs to maneuver road traffic and rules and regulations . Takes some smarts .

So if you are having trouble feeding the pipeline , and then having trouble delivering what's in the pipeline well here we are . From what I hear because I have never worked in either field but you can make good $$$ in either of these professions . But of all the friends/family/coworkers you know how many are striving to be in either of these fields . Unfortunately many have the mindset it is not glamorous enough . Or worse yet it's hard work . It's very difficult to drive a truck or unload a ship when your head is buried on your phone .

Here is just one example of thousands out there.

https://www.yahoo.com/news/coca-colas-york-distributor-says-115825139.html

thanks folks.

Just found this example , I use to eat there when I lived in Orlando. That location has been open for 35 years but forced to close as they were down to 4 employees . Per the owner no one wants to work .

https://news.yahoo.com/florida-bbq-restaurant-shut-down-110227522.html

There is not a labor shortage - at all. There's a wage shortage.

Transportation - Supply Chain problem - why
 

I was going to create another thread but this one works.

BMW and Daimler pledge to keep prices high when chip crisis ends

https://www.ft.com/content/f55a1d96-1146-4e17-88a9-1a0fbaf57de6?fbclid=IwAR3XF8My8dYuq_lXIqRdSOWDSW9c A-BSGkFeJNOZckmn-N4v0BtySvGnsNE

Carmakers Daimler and BMW separately plan to limit the volume of premium models they ship even once the industry-wide chip shortage eases, in a bid to lock in the hefty price increases they have achieved during the pandemic.

A chronic shortage of semiconductors, which cars rely on for everything from electronic windows to driver assistance systems, has hobbled the supply of vehicles just as consumer demand rebounds from repeated lockdowns.

Although the luxury German carmakers were already shifting away from a volume-based approach before Covid-19, customers’ willingness to pay higher prices during the pandemic has emboldened them to go further.

“We will consciously undersupply demand level[s],” Harald Wilhelm, Daimler’s chief financial officer*told the Financial Times, “and at the same time we [will] shift gears towards the higher, the luxury end.”

BMW had “seen a significant improvement in pricing power in the last 24 months,” said chief financial officer Nicolas Peter in a separate interview. The Munich-based carmaker’s plan was “clearly to maintain . . . the way we manage supply to maintain our pricing power on today’s level,” he added. This would be through a number of measures including digitally tracking customer demand.

Industry executives, car dealers and analysts say that the chip shortage, which has its roots in a competition between the auto and consumer electronic industries for a limited supply of semiconductors, will herald a new approach in pricing and selling premium models.

“The pandemic has really opened everyone’s eyes — that a different paradigm is possible,” said Arndt Ellinghorst, an analyst at Bernstein. “Everyone loves it, including dealers.”

Discounts typically offered to customers at dealerships — usually around 15 per cent in mature markets — have been slashed, with some models being sold above sticker price.

A one percentage point decrease in the average discount would release $20bn in extra profits for car manufacturers, according to Ellinghorst, and discounts in Europe and the US have dropped by at least double that amount from their pre-pandemic peak.

BMW’s Peter said that the group’s US dealers, “always claimed . . . well we need the cars in the showroom, the customer is expecting to pop in on Saturday morning, 10am, and he wants to leave with everything done, fixed number plates on the car at 1pm latest.”

Now, however, they say “customers are ready to wait three to four months, and this is helping our pricing power,” he added. “Of course the waiting time must not be too long, but if you buy a premium car like a BMW, it’s an emotional decision . . . to have a short waiting time is something, I believe, which makes the customer experience even greater and better.”

The increased pricing power has already fed through to the bottom lines for BMW and Daimler. Mercedes achieved a 12.2 per cent return on sales in the last reported quarter, up from 8.4 per cent in the same period in 2018 — the last measure not affected by the pandemic or diesel emissions litigation costs. BMW’s margin reached almost 16 per cent, up from 8.6 per cent.

Daimler’s Wilhelm said that while the chips shortage has artificially lifted prices, “one day or another the semis issue will be gone and we will carry on with the price, and the margin, and the mix focus”.

Signs that pricing power is proving sticky for luxury carmakers comes as central banks remain alert for signs of inflation as the global economy rebounds.

The European Central Bank this week raised its inflation forecast for this year to 2.2 per cent, but predicted it would fall back below its 2 per cent target next year and remain at only 1.5 per cent in 2023.

There is a microchip shortage which has been affected by the Asian factories that have had to shut down/eliminate shifts because of covid running rampant. This is why dealerships have no new cars, why electronics stores don't have product, and why appliance makers are running behind.

I think there may be an element of hoarding/prepping going on with people who believe in a TABS style global financial crisis. This would explain many empty grocery store shelves.

Beyond all of this, far too many folks have left the workforce, and refuse to return for whatever reason motivates them.

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I think the problem lies somewhere in between. Minimum wages cold stand to be higher in some parts of the country. People also have to be realistic and understand that you can't demand the salary commensurate with a four year degree for flipping burgers.

Everybody would like to be paid more money - in most cases you're paid based on your experience and education. You're first job at Wendy's you most likely have neither experience or education and your wage would reflect that.

I've got a buddy that owns his own trucking firm.
When COVID hit - and there was no product moving anywhere - a LOT of sole proprietors and small firms closed up shop. Trucking rates dropped down to $1/mile. His operating costs are higher than that - so he parked his trucks and was able to make it through the storm. When product started moving again - there weren't as many drivers/trucks available - and contracts starting up were then paying $3-5/mile!
I'm not sure they are still that high though. There are definitely not as many truckers on the road now though.

10 years from now, students studying Supply Chain and Logistics will write theses on the 24-30 starting in February of 2020.

The latest wrinkle in our house is my son’s bus wasn’t showing up for the first week. The school district contracts out the bussing and the bus company was unable to find drivers.

They’ve either left for better paying trucking jobs or left the workforce entirely.

As stated, there is probably some combination of the above.

1 Everybody these days wants and expects to have an 80" TV and iPhone 12-super-mega. To afford those things, they need more money (or credit)
2 Not everyone is worth more money
3 Some places (Cali, NYC, etc...) cost an arm and leg to live, and so even the folks in jobs that aren't really worth a lot need a lot more money to live a very basic life than if they were in Houston or Mississippi or anyplace else with a low cost of living
4 I suspect places like a BBQ place, need to be raising prices, but then the public is expecting everything to be cheap, if places don't raise prices, then places can't pay employees more.

Everyone seems to be expecting Walmart prices and premium goods, whether it is for food, gas, phones, TVs, shoes, clothes, etc.... Prices staying roughly the same or even going down so that everyone can keep up with the Jones', but also everyone having increasing salaries so that everyone can keep up with the Jones' cannot last forever.

That that that..means not every Chump aspiring to.be rich is going to be able to drive a Benz..or Manure Wagen...ohhh dear..

RIP..mass market consumerism..That mentality really kicked off in the mid 70's ....remember what happened to the 911 in 74?

And fk. DIETER at Benz and Wofie at BMW...they were moving towards fewer cars..yep..BS..Not as many people could afford their over priced schlock.

Now the fkers are too stupid to realize what happened to Dusenburg, Pierce Arrow etc in the 30's can happen to them..even rich people stopped buying the luxury stuff.

An automobile is nothing more than.a glorified appliance..like a washing machine and is a depreciating asset.

Well i here some Burger joints are requiring a 4 year degree to flip them burgers...

I'm having a machine part shipped from Michigan this weekend. $4/mile and this is probably a box van not an 18 wheeler. Seems pretty profitable to me.

People working those service jobs have no motivvation.cause they cant even make ends meet working those service jobs. So they feel they have no.future just endless drudgery. An 15 an hr hardly helps ...this essentally means that there is little to no real MC anymore and now it just a large working poor class.. So why the fk work when you cant get what is being shown on TV.

I laid this out more than 20 years ago..it started in the 70's..A return to the economic demographics of 1910.

Why dont they give ELON a call an git some of those self drivin rigs goin.

Ohhh wait if no one has a job how are they gona be buyin all those wonderful AI produced thigs?

Retrain ya say..with 50% of the pop wt an IQ UNDER 100 they are NOT able to grasp the complexities of a high.tech job...ohhhh now what are ya gona do genius.

I guess put em on Welfare to keep em from lootin and pillagin.

You know how fkin delusionaly stupid these tech guys sound?

The just in time supply chain was a fine tuned thing..shut it down and it broke the chain..now it is running like an engine that is out of time. It will take time to retweak it..if sumthin else dont screw it up.

I'm not sure on the shipping containers. march 2020 during the height of the lock downs I was buying cargo worthy 20 ft shipping containers for 1,800 in long beach. Last time I looked for more containers (feb this year) I could not find any stock of 20ft CW containers, but one trips were going for 2,900 & I bought one of those instead.

Welcome to the idiocracy..American ed has bin on the skids for more than 40 years..i cant even say my gen had a good ed..why look at me i cant speel.nor have gud grammer..and i gots a piece of paper from an illustrious university by the sea..they keep sending me these emails touting how great they are.
Well blow me..the guys who run these places smoked too much Chronic back in the day and it has rotted their brains (insert pix of Nancy Pelosi here).

So i digressed a bit...now we are faced with a pop wh have the skill sets of monkeys.
And that is an imsult to monkeys. But what takes the cake right here is the ignorance and naivieaty right on this Board..A scare crow out in a Nebraska corn field has more sense and knowledge about foreign affairs econ and history than you boyz du..A blind mouse has clearer vision than your chosen leadership
and forget presence of mind..Presence of mind i give Amerucans a negative number.

People think Bill Gates is a smart guy..and he is but he is stupid enough to go and get caught going to Epsteins pleasure isle of enchantment.. At best Epstein had him by the rocks..And Bill couldnt figure out the ramifications of that move..best thing to do if you want to indulge in that hobby..dont even hide it..old news is no news. Call it the Charlie Sheen/Mick.Jagger model of self satisfaction.

I guess that I got very lucky when I picked up my new Taco as a '20 leftover last October.

OTOH I can't find an apartment sized gas fired clothes dryer at any of my usual appliance purveyors.

Steve,
There has been a shortage of truckers for a few years now. The problem was really exposed when more freight became available. Now we have stuff sitting on docks waiting for a truck because loads are plentiful and truckers can afford to be selective about what they haul.

Something else that hurts is electronic logging. Not saying it's a bad thing but less truckers able to run less miles per day = more truckers being selective about the loads they're hauling. Used to be I could get a skid loader on the back of a load because the trucker was okay with the partial paying for the fuel. Now with e-log they don't want to make that extra stop because time is literally money and miles.

Sure, more regulations make it more of a pain and tighten margins which make it less appealing.

Businesses got used to cheap service labor, with a plethora of 5hitty excuses to justify it, eg "Certain jobs don't deserve more than $x per hour" "Those jobs are for teenagers to get work experience". At the the same time, "income property" has become the investment of choice, my guess is due to favorable tax conditions. I don't know much about the landlord industry, but I hear radio ads for "almost tax-free real estate investi"' I'm guessing that's part of it. That's driving up real estate prices and rents. When I moved to this area in the 80's, I rented a decent 1-bedroom apartment for $165. Now a similar apartment is $1600.

Long-story-short - you can't have it both ways. You can't get cheap labor, while at the same time cranking your rental profits. Something is going to break.

Yep, certain places (Cali and a few others) definitely seem to be broken in that regard. If housing is insane, then salaries need to be commensurate

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You're referring to this heirloom thread ?

Maybe they're all learning how to code. SmileWavy

Yep, I work at an automotive plant and we are not running any production for next week due to the semiconductor shortage. It has been like this all year, where a shift would be off for the week, usually 3rd shift, and early dismissals here and there. They tried to keep everyone working as much as possible but it looks like it has all finally caught up to us.

Oh well, if the weather is good, I'm going sailing!!!

No semiconductors on this baby!!!https://uploads.tapatalk-cdn.com/202...1ecda67e39.jpg

Sent from my SM-N950U using Tapatalk

It is not that wages are too low. We have been paying people not to work for a long time. Why go ro qoek id you don't have to pay rent.

Housing prices in California are a study in bureaucratic corruption, and have nothing at all to do with wages

Or build solar panels.

Before the COVID deal many OTR truckers would not cross the CA state line. Over half the crap people buy (in the vein of tabs), comes through a CA port.

Local, underpaid container drivers move containers out of the port by the 1000's each day. But they don't long haul one at all.

Plug that into the Conservative Translator: "People need to be starving so they'll work for cheap"

Labor is a resource that you have pay for, just like anything else. Those good-for-nothing scoundrels at Home Depot want to charge me $15 for a 2x4; it should only be worth $3.

Nobody said housing prices had to do anything with wages, but there is a relationship between wages and what people can afford to pay in rent. If people can't afford to live on the pay of service-sector jobs, you're gonna have a bad time.

Right. If housing is insane, then wages need to be higher enough for folks to be able to afford to live without resorting to 20 people in a 2 bedroom or whatever qualifies as how to live on the cheap in Cali.

In my experience with Cali and folks in Cali, it seems like wages are a little higher than other places, but then housing is A LOT higher. And other items like food may be higher, but more like the level of the pay than the level of the housing.

I've mentioned this a couple of times here recently.

My trainers day job is Logistics, specifically trucking.

He says driver shortage has been an issue for the last 6 years at least and got worse with COVID.

They are paying their local 9-5 guys $100k these days.

OTR like Dallas to LA routes $150k.

Long haul dual driver where they run straight through non stop, $300k.

If you know a young person coming out of HS who may not be college bound, encourage them to get their CDL. Hell, even a college grad.

And FWIW, he says supply chain is not getting better in the coming months, it's going to get worse. Says we haven't seen bad yet compared to whats coming.

It's funny, in a not-funny kinda way. Just 2.5 years ago, we took a tour of an aviation training program, and they were saying the same thing about airline pilots. "Tell everyone to go into it, they're going to be down 50% once the oldies retire, pay quickly gets to the $150k range...".

Then, 1.5 years ago, every pilot lost their job.
The same was said about nursing, and a few other fields (except the nurses didn't lose their jobs, they worked 100 hour weeks and then lost their lives...).

In fact, the only thing that didn't really seem to slow down was skilled labor for new construction, the trades and unions seem as busy as ever!

The chip shortage has effected every item that has a some sort of electronic PLC, control module, etc. This affects machinery - I seeing a chip shortage issue on a 400 ton horizontal molding press that is manufactured in Austria.

What I'm seeing is the 80/20 rule when is comes to who gets the components/commodities (includes raw material). High volume customers are at the top of the list. A low volume customer goes to the back of the line unless there is an opportunity to pay a premium. I'm looking a at 1-2 month delay. That is not including overseas shipping which is just as bad shipping over the Atlantic as the Pacific.

I have been looking at an upgrade graphics card for my desktop - I do allot of photo editing. The cost of a graphics card is almost double for the same chip shortage reasons and supply is limited.

I have a friend who has a SIL that is an over the road driver. Big demands on schedules: tighter shipping times, long days, never home on weekends: life is on the go. He is getting burned out. Makes allot of money but he has a family and doesn't have allot of time to spend with them.

Most trucking companies want CDL drivers with 2 years experience and a clean accident free record. Insurance is high and even the smallest claims pushes premiums. The trucking companies I'm familiar with won't even look at a new driver with a CDL.

Hell, Swift or Schnieder will hire right off the street and put guys through training. thats why their accident rates are so high.


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