Today’s Logistics Report: YRC’s Heavyweight Aid; Fighting for Chips; Vetting Suppliers

Trucking company

was the biggest beneficiary by far of a program aimed at helping defense contractors weather the impact of the Covid-19 pandemic. The fourth-largest less-than-truckload carrier in the U.S. was one of just 11 businesses that received loans through the $17 billion program for that sector, the WSJ Logistics Report’s Jennifer Smith writes, and the $700 million earmarked for YRC made up 95% of the roughly $736 million in outstanding loans. YRC so far has drawn down $551.3 million, or about 79% of its loan. The backing has brought critical support to a company long troubled by heavy debt loads and thin financing to refresh its aging fleet. But many shippers prize YRC for its extensive national network, and the trucker in defending the loan says its reach is “absolutely crucial” and would be difficult to duplicate through other carriers.

SUPPLY CHAIN STRATEGIES

Semiconductor suppliers can’t add new production fast enough to keep up with red-hot global demand for chips. Semiconductor companies are asking their customers for patience as the industry works through a sharp increase in demand, the WSJ’s Asa Fitch and Elizabeth Koh write, but relief could be slow since some of the deepest supply problems are taking place with older production lines that are less lucrative for manufacturers. The shortfall between supply and demand has already hit the automotive sector, where major manufacturers have suspended production lines because they lack the key components that are the brains behind today’s cars. But the supercharged demand goes beyond car factories, as a resurgence in computer purchases and a broader drive toward digital products drives the need for more chips. With companies across far different sectors now competing for limited manufacturing capacity, lead times for semiconductor deliveries have extended to six months.

LOGISTICS TECHNOLOGY

The growing revelations about the

hack are pushing companies to look harder at their own supply-chain security. Businesses that have been assessing their exposure to the attack on the software provider are now looking more closely at their suppliers’ security, the WSJ’s David Uberti and Kim S. Nash report, leading some companies to review their vetting processes and even pause updates to applications. Cybersecurity experts say the task could grow more complex as details emerge about a hack that has jolted the supply chains that help the digital economy run. As many as 18,000 SolarWinds customers downloaded the malicious update and the software company shared evidence this week suggesting attackers breached its networks a month earlier than previously known. Cybersecurity experts say the incident underscores the urgency of protecting supply chains that are composed of large numbers of third-party suppliers and vendors.

QUOTABLE

IN OTHER NEWS

Economists in a survey expect the U.S. economy to grow 4.3% this year. (WSJ)

U.S. filings for initial jobless claims jumped by 181,000 to nearly 1 million last week. (WSJ)

Rising temperatures last year capped the world’s warmest decade in modern times. (WSJ)

OPEC expects the global appetite for oil to remain subdued in the first quarter of 2021 after demand fell 10% last year. (WSJ)

Toyota Motor Corp.

will pay $180 million to settle a U.S. complaint that it violated emissions-reporting requirements for about a decade. (WSJ)

Delta Air Lines Inc.’s

cargo revenue rose 9.1% in the fourth quarter as collapsing passenger demand left the carrier with a $755 million net loss. (WSJ)

U.S. supply chains across a range of industries are being disrupted as large numbers of workers miss work because of Covid-19. (Bloomberg Businessweek)

U.S. exports of wood pellets fell 19.8% in November from the year before. (Biomass Magazine)

Consumer-goods supplier

Unilever

PLC expects global consumption to remain suppressed in the first half of this year. (Reuters)

Japan’s NYK Line will ship some automotive exports to Europe by rail rather than sea to cut emissions. (Nikkei Asian Review)

Ship-scrapping companies are paying higher prices for vessels amid a global shortfall in steel. (TradeWinds)

German container line

Hapag-Lloyd AG

is suspending one of its services to Long Beach, Calif., because of worsening port congestion. (Lloyd’s List)

Container throughput at the Port of Singapore slipped 0.9% last year and vessel calls fell by 37.4%. (Business Times)

Alibaba Group Holding Ltd.

logistics arm Cainiao started an air and sea freight booking platform. (The Loadstar)

German digital freight forwarder Sennder raised $160 million in a Series D funding round. (TechCrunch)

Some trucking companies are using data from electronic logging devices to switch to paying drivers based on time rather than miles driven. (Commercial Carrier Journal)

Union Pacific Corp.

is dropping surcharges it had imposed on West Coast container imports. (Journal of Commerce)

Contemporary versions of sea shanty songs sung on merchant ships have grown popular on the TikTok social app. (The Cut)

ABOUT US

Paul Page is editor of WSJ Logistics Report. Follow the WSJ Logistics Report team: @PaulPage, @jensmithWSJ and @CostasParis. Follow the WSJ Logistics Report on Twitter at @WSJLogistics.

Write to Paul Page at [email protected]