Today's Top Supply Chain and Logistics News From WSJ
22 August 2016 - 8:26PM
Dow Jones News
By Paul Page
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Analysts believe JDA Software Group Inc. and its customers may
be better off with a new capital infusion rather than a new owner.
The supply-chain software plans to use a $570 million investment
from private-equity firms New Mountain Capital and Blackstone Group
LP to reduce its debt load and expand its research into cloud-based
services, building out the technology JDA says retailers need to
ramp up their e-commerce capabilities. The investment pushes aside
a buyout bid by industrial conglomerate Honeywell International
Inc., WSJ Logistics Report's Loretta Chao writes, and provides what
analysts say will be continuity and potential expansion for JDA's
retailing customers. An equity investment, rather than an outright
sale, is less likely to disrupt those services, says Dwight
Klappich of Gartner. The capital injection will reduce the
company's $2 billion debt by $500 million, and save JDA $70 million
a year on interest payments.
Nike Inc. is taking an unusual path to more completely overhaul
its supply chain . The apparel giant is looking past basic
vendor-supplier agreements by striking a deal with private-equity
firm Apollo Global Management LLC to set up a fully controlled and
contained manufacturing and distribution operation. Under the plan,
t he WSJ's Josh Beckerman reports, a new apparel supply chain
company is purchasing existing Nike apparel suppliers with an eye
on creating "a more vertically-integrated apparel ecosystem." The
venture marks a deep dive into the supply-chain business by Apollo,
which aims to pull together a global outsourced manufacturing
operation under one financial ownership umbrella. It also steps up
Nike's efforts to restructure its supply chain: the company has
added big distribution operations in the U.S. and Europe and struck
a partnership with Flextronics International Ltd. as it tries to
overcome concerns over inventory management and complaints from
retailers over product deliveries.
The rush to handle Canada's big fall grain harvest is already
underway. Ahead of an expected near-record crop this year, Canada's
transportation regulator is reporting a jump in the number of
government-owned grain railcars needing repair. The WSJ's David
George-Cosh reports that is raising worries among farmers and grain
companies over potential bottlenecks. The higher-than-normal rate
of railcar repairs comes as Canadian farmers are expected to
produce 75 million metric tons of grains and oilseeds in the
2016-17 crop year. Canadian Pacific Railway Ltd. has pointed to the
big harvest as a critical source of optimism, and it notified
customers last week that "producer collaboration" will be needed to
keep hopper cars moving. The new capacity concerns highlight
questions over Canada's system for managing the cars, which include
a big government-owned fleet that some argue should be shifted to a
market-based system.
SUPPLY CHAIN STRATEGIES
Bumps in Germany's famously efficient automotive supply chain
are leading to a dispute between one of the country's top
manufacturers and its suppliers. Two Volkswagen AG suppliers are
denying responsibility for parts shortages at the German car
maker's plants, the WSJ's Hendrik Varnholt and Sarah Sloat report,
problems that Volkswagen says are forcing the company to reduce
production. The issues are bad enough that Volkswagen is suspending
output this week of its Golf and Sportsvan models at one factory
because of a dispute with suppliers after scaling back work at
other sites. Volkswagen says it's the result of a labor dispute,
but two suppliers say they are being scapegoated for the
manufacturer's own problems. The two sides will resume talks this
week aimed at resolving the rare public dust-up. The dispute comes
as Volkswagen is facing bigger problems in the aftermath of
diesel-emissions cheating scandal that has roiled the business and
hurt demand for its cars in some markets. That demand, the
suppliers say, may be Volkswagen's real concern.
QUOTABLE
IN OTHER NEWS
Amtrak is naming former Norfolk Southern Corp. chief Charles
"Wick" Moorman as its next chief executive. (WSJ)
Canadian retail sales fell 0.1% unexpectedly in June due to
weaker sales at food, beverage and general merchandise stores.
Government-owned China National Chemical Corp says a U.S.
national-security regulator cleared its $43 billion acquisition of
Swiss seed company Syngenta AG. (WSJ)
Emerson Electric Co. will buy Pentair PLC's valves-and-controls
unit for $3.2 billion as it expands its automation offerings.
(WSJ)
General Motors Co.'s Opel unit is paring back the hours of
German factory workers in a move aimed at blunting the impact of
Brexit and breaking even in Europe. (WSJ)
The downturn in department stores has Estée Lauder Cos.
struggling to improve sales. (WSJ)
Honda Motor Co. Ltd. began exporting Civic hatchbacks from its
Swindon, U.K., plant to the U.S. (Automotive Logistics)
Rural Utah counties withdrew their application to invest $53
million in an Oakland coal export terminal but left open reviving
the plan in the future. (Salt Lake Tribune)
A California judge rejected new challenges by opponents of a
planned sprawling logistics center in Southern California's Moreno
Valley. (Riverside Press-Enterprise)
Michelin North America, Inc. will phase in online sales for its
BFGoodrich Tires division in the U.S. over the rest of this year.
(Multichannel Merchant)
Chinese e-commerce giant Alibaba Group Holding Ltd. has held
partnerships talks with a several start-ups in India, including
Snapdeal and Shopclues. (Business-Standard)
North American companies ordered a record number of robots in
the first half of 2016. (Modern Materials Handling)
Asian food-delivery startup Foodpanda is trying to sell its
operations in Indonesia and evaluating its presence in the rest of
Southeast Asia. (TechCrunch)
India's government will be 50% shareholder in a proposed
multi-modal logistics hub along a planned Delhi-Mumbai industrial
corridor. (Economic Times)
XPO Logistics Inc. Chief Executive Brad Jacobs says technology
startups are offering nothing beyond services existing operators
have available. (American Shipper)
ABOUT US
Paul Page is deputy editor of WSJ Logistics Report. Follow him
at @PaulPage, and follow the entire WSJ Logistics Report team:
@brianjbaskin, @lorettachao, @RWhelanWSJ and @EEPhillips_WSJ, and
follow the WSJ Logistics Report on Twitter at @WSJLogistics.
Subscribe to this email newsletter by clicking here:
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Write to Paul Page at paul.page@wsj.com
(END) Dow Jones Newswires
August 22, 2016 06:11 ET (10:11 GMT)
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