LA theft gangs are increasingly targeting Nike shipments. A Canadian truck driver was apprehended in Buffalo with drugs stashed in waffle boxes headed for Georgia.
Good Morning Monday. LA theft gangs are increasingly targeting Nike shipments. Β A Canadian truck driver was apprehended in Buffalo with drugs stashed in waffle boxes headed for Georgia. Yellow has formally declared bankruptcy, and while global manufacturing is hitting a bump, the US stands firm. Additionally, XPO is gearing up to fill the vacuum left by Yellow's exit.
Can you take a guess at the staggering average value of a stolen Nike shipment?
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Three Freight Headlines: A Canadian trucker was arrested with over 2,000 pounds of hidden drugs, Yellow declared bankruptcy impacting 30,000 jobs, and global manufacturing stalls while the Americas show resilience.
LA Theft Gangs vs. Nike
Around the Freight Web: XPO steps in to fill Yellow's void, rising peso impacts US-Mexico trucking, trans-Pacific spot rates outpace contract rates, plus more.
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π WHATβS COOKINβ IN FREIGHT
Peace Bridge: US-Canadian Border Crossing in Buffalo, NY, where a major drug bust took place hidden within waffle boxes. Source: CDL Life.
π§ Drugs Hidden in Waffle Shipment. Canadian truck driver, Ajaypal Dhillon, was arrested after being found with over 2,092 pounds of marijuana and 112 pounds of ketamine hidden in his trailer while crossing the Peace Bridge into Buffalo, New York. The drugs, which were found during a search by Customs and Border Patrol officers, were concealed in boxes under the guise of a shipment of frozen waffles intended for a Georgia grocery store. Dhillon has been charged with possession of marijuana with the intent to distribute, as well as importing it into the U.S.
πΈ Yellow Officially Declares Bankruptcy. Following an anxious wait since last Monday, Yellow has officially declared Chapter 11 bankruptcy and started liquidating assets, confirming industry predictions. The closure, triggered by accumulated debt, a sizable Covid-19 relief loan, and union conflicts, is set to impact 30,000 jobs and leave creditors like Amazon and Home Depot in a bind.
πΊπΈ Global Manufacturing Activity Stalls, USA Stays Strong. Global manufacturing hit a roadblock in July 2023, as it struggled to recover from economic headwinds, with China's slowdown being a key factor. The stagnant worldwide index at 48.7, a low since June 2020, reflects reduced factory output and orders. Europe saw a significant contraction, especially in powerhouse economies Germany, France, and Italy. However, the Americas demonstrated toughness, with the US, Canada, Brazil, and Mexico showing positive signs, and Mexico even hitting a seven-year high in manufacturing activity.
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LA Theft Gangs vs. Nike
Rise in Organized Cargo Theft
In the aftermath of the pandemic, organized cargo theft has emerged as a significant issue, rising by 57% compared to the previous year. This new form of crime involves criminals intercepting cargo shipments, using falsified pickup addresses or stolen freight brokers' credentials, and diverting large deliveries away from their intended destinations. The average loss per theft incident has also increased, reaching a staggering $260,703.
Nike Shipments - A Preferred Target
Notably, Nike shipments have become a favorite target for these criminals. The brand's products, particularly the limited edition Air Jordans and other select styles, are stolen at every phase of the supply chain and fetch high prices on the resale market. Los Angeles authorities have reportedly recovered $3 million worth of stolen goods from the athleticwear brand.
Earlier this year, a number of containers carrying Nike merchandise were reported stolen after passing through the Port of Los Angeles, as confirmed by law enforcement authorities. PHOTO: ERIC THAYER/BLOOMBERG NEWS
Impact on Retail and Logistics
The surge in organized cargo theft is causing significant disruption across the retail and logistics sectors. Major states like California, Texas, Florida, and Illinois are experiencing high rates of such thefts. As a result, retailers like Walmart and Target have been forced to close their stores in various cities. The continued rise in e-commerce has also influenced this trend, with more buyers opting for online shopping.
A New Form of Organized Crime
The criminals involved in these cargo thefts are part of organized crime groups that carry out carefully planned operations. They're knowledgeable about store layouts and valuable inventory at each location. They employ spotters trained to analyze contents of shipping containers and often collude with retail and logistics company employees. This sophisticated approach to crime highlights the urgency and complexity of addressing this issue.
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AROUND THE FREIGHT WEB
XPO appears to be targeting former Yellow Account Executives as it gears up to fill the gap in the market left by Yellow Corp's ceased operations.
π XPO Gears Up to Fill Yellow's Gap in the Market. As Yellow Corp's operations cease, XPO plans to ramp up its capacity to meet increased demand, with shipment volumes rising 9% in July.
π July 2023 Rail Volumes Reveal Mixed Economic Signals. July 2023 saw mixed U.S. rail volumes, indicating varied economic trends with both robust activity and signs of sectorial challenges.
π’ Maersk Cuts Costs Amid Shipping Slump. Amidst declining global container volumes, Maersk boosts earnings by sharpening focus on cost-cutting measures while grappling with a contracting container shipping market.
π° Strengthening Peso Poses Threat to US-Mexico Trucking. The rising value of the Mexican peso against the dollar is anticipated to boost freight rates and the cost of goods in US-Mexico cross-border trade.
β¬οΈ Asia-US Spot Rates Surpass Contract Rates. For the first time since 2022, rising spot rates have surpassed contract rates, leading to a sustainable market for shipping lines and a modest increase in trans-Pacific cargo demand.
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