In Brief: Tracking trucking time & the wrong road

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But who’s counting?

Keeping track of truckers

The U.S. trucking industry is divided over a new federal regulation due to go into effect on June 18. One provision requires that trucks use an electronic logging device (ELD), rather than paper logs, to make their record-keeping more transparent.

Regulations limit the number of hours a trucker can drive before being required to take a break. In general, they mandate 14 hours on duty, with a maximum continuous driving time of 11 hours, followed by 10 hours off duty.

However, there are exemptions: during each state’s designated planting and harvest seasons, deliveries within 150 miles of the source of an agricultural commodity are excluded from the 14 hours. However, most ELDs cannot track exempted hours, according to the National Potato Council.

At US$500 apiece, smaller trucking companies say the ELD’s cost of installation and maintenance is prohibitive. “Industry observers believe that enforcement of the ELD mandate will reduce the miles driven by certain historically non-compliant carriers, which are predominantly smaller operators,” U.S. Xpress Enterprises, the country’s fifth-largest trucking company, said in a recent SEC filing.

The owners of U.S. Xpress are preparing to sell more than US$300 million of stock and return the company to a publicly owned business traded on the New York Stock Exchange. The company said economic growth and rising e-commerce had boosted freight volumes and truck company valuations, while the ELD mandate would improve the fortunes of larger transporters with economies of scale to absorb its costs.

The invisible belt & road

Top Hong Kong officials were in Beijing this week for a June 12 Belt & Road Initiative conference focusing on how Hong Kong can best be involved in projects that revive the old trade routes between Asia and Europe.

But a new analysis for the University of Hong Kong’s Asia Global Institute suggests the westward Silk Road will be far less important to Chinese companies than the eastward route across the Pacific Ocean.

“If China is going to be one of the leading global technological centers of the 21st century ... its companies will have to climb netware value chains that connect them to Silicon Valley, Seattle, and other American technology hubs,” writes Salvatore Babones, an associate professor at the University of Sydney and an expert on Chinese and American economy and society.

Scoring commercial goals

The United States might not have qualified for the 2018 FIFA World Cup, which kicks off on Thursday in Russia, but U.S. brands will be front and center during the month-long soccer tournament.

Coca-Cola, Visa and McDonald’s are among the event’s leading sponsors, while another American icon – the Anheuser Busch brewery – will also be highly visible, although parent company AB InBev is based in Belgium. 

However, analysts say U.S. companies are unlikely to get much of a sales boost from their sponsorship. The biggest likely winner is Adidas, the German footwear maker.

“Adidas will get massive exposure and, being a fast-moving consumer goods brand, sales could easily be impacted positively from the event,” according to Peter Garnry, head of equity strategy at Saxo Bank in Copenhagen.

Another beneficiary of the tournament’s global reach will be an Inner Mongolia company, China Mengniu Dairy, which is promoting a new yoghurt drink during the event. (The Chinese market is expected to account for the largest share – US$835 million of US$2.4 billion – of advertising budgets for the World Cup, according to Zenith Media).

“There will be a lot of focus on the World Cup in China despite the fact that the country did not qualify,” Garnry added, citing President Xi Jinping’s pledge last year to transform the country into a global football power by 2050.