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QAD Precision News Round-Up: 22 May 2020

In the QAD Precision News Round-Up 22 May 2020, UK unveils post-Brexit tariff regime; WTO reports decline in global trade; Target trials new sort centers; demand for autonomous deliveries surge; plus the benefits of free trade agreement compliance and more.

Retail 

TARGET TRIALS POST-STORE SORT CENTER FOR LAST-MILE DELIVERY 

In an effort to better facilitate last-mile delivery, Target is trialing a new sort center concept downstream from stores. Target plans that the sort centers will eliminate parcel sorting from stores. As a result, this should enable greater throughput of e-commerce orders along with increased shipping efficiency to reduce costs per order. These facilities will be smaller than a regular Target store. The company will determine their location by parcel density. Nevertheless, it is worth noting that in the first quarter of this year, Target completed 80 percent of e-commerce orders using ship-from-store fulfillment. Target also achieved a 141 percent year-over-year increase in e-commerce revenue. Please see Supply Chain Dive for more information.

Global Trade 

UK UNVEILS POST-BREXIT TARIFF REGIME

On Tuesday, the UK announced a post-Brexit tariff regime to replace the EU’s external tariff. Under this new regime, the UK will not remove tariffs on imported products that compete with local industries, such as fishing and agriculture, as well as automotive and ceramics. However, under the new tariff regime, the UK will cut duties on £30 billion ($37 billion) worth of supply chain imports. Furthermore, the new tariff regime aims to streamline what some UK officials believe to be an overly complex EU system and assist Britain in negotiating trade agreements with the United States, the EU and others. For in-depth information, please see Reuters. 

WTO REPORTS DECLINE IN GLOBAL TRADE 

The World Trade Organization (WTO) has reported that international imports and exports have dropped to their lowest level in four years as the coronavirus impacts the global economy. The WTO quarterly goods trade barometer fell to 87.6. On this scale, readings of less than 100 signify a downturn. This reading is the lowest value on record since the WTO unveiled the indicator in July 2016. Automotive products were most negatively impacted due to a collapse in car production and vehicle sales in the world’s leading economies. Additionally, declines in demand for traded goods and supply chain disruptions have resulted in reduced container shipping and air freight across all sectors. You can read more details on this news item at The Guardian. 

Carriers

DHL EXPRESS PILOTS E-CARGO CYCLES DELIVERIES ACROSS MIAMI 

DHL Express is to test the use of low-power e-Cargo Cycles in Miami, Florida. The carrier is partnering with REEF Technology for the trial of the delivery e-Cargo cycles. The vehicles have a cargo container and can pull up to 400 pounds or 60 cubic feet in volume. As a result, for each e-Cargo Cycle used, DHL can take one regular delivery van off the road, reducing road congestion, noise and pollution. Moreover, by 2025, DHL plans to have clean pickup and delivery solutions for 70 percent of its operations. For more information on the DHL Express e-Cargo Cycle trial, please click here.

Transportation 

INCREASE IN AUTOMATED DELIVERY VEHICLES DURING LOCKDOWN

Autonomous deliveries have surged in demand due to the coronavirus lockdown. Consequently, automated delivery company Waymo, owned by Google’s parent Alphabet, has seen an increase in investment during the pandemic, as the company raised $750 million in mid-May. At first, Waymo concentrated on self-driving vehicles, such as taxis and trucks, but now has inked deals with Walmart and UPS for its delivery arm. For more details on this news item, please see Charged Retail. 

AIR FREIGHT VOLUMES INCREASE AT ONT CALIFORNIA

In April, Ontario National Airport (ONT) in California reported its highest year-on-year growth in air freight volumes. During the month of April, approximately 75,000 tons of commercial cargo were loaded and unloaded at ONT, a 26.6 percent increase compared to April 2019. Furthermore, ONT handled more than 271,000 tons of air freight in the first four months of this year, a 16.5 percent increase on the same period last year. You can read more details on this at AirCargo News. 

QAD Precision News

FREE TRADE AGREEMENT COMPLIANCE: CHALLENGES VS BENEFITS

After 14 months of negotiations, the United States, Canada and Mexico agreed the terms of the new Nafta free trade agreement on 30 September 2018. This was just the first step in the process. After that, the three signatory countries had to ratify the United States - Mexico - Canada Agreement (USMCA).

Naturally, the three countries have different routes, and timelines, for ratification. Mexico first ratified the updated FTA, followed by Canada and then the US. Furthermore, all three countries had to notify one another that they were ready to comply with the new FTA. It was possible that the Covid-19 pandemic could have delayed the USMCA, but on 24 April the parties completed the final steps. As a result, the USMCA comes into force on 1 July. Free trade agreements offer enterprises a competitive advantage, but compliance can be burdensome. In this QAD Precision Report we look at the challenges and benefits of automating FTA compliance. To read the full report, please click here. 

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