CGIP Celadon Group Inc (CE)

By Paul Page 

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Toy makers, electronics companies and retailers are bracing for a tariff-driven shock to the consumer market. President Trump's threat to extend tariffs to essentially all Chinese imports dramatically escalates a trade conflict that is now poised to hit U.S. consumers in the pocketbook. The WSJ's William Mauldin and Vivian Salama report the new 10% tariffs would take effect Sept. 1 and cover $300 billion in Chinese goods. They would come on top of tariffs already imposed on $250 billion in imports from China and would extend deeper into the retail sector, raising costs for a broad range of consumer products. The tariffs would strike in the midst of the peak shipping season, with thousands of containers packed with products already on ships or lined up for transport to the U.S. The deadline could push importers to speed up purchases to get more products into supply chains before costs rise.

TRANSPORTATION

The last mile proved too costly for Schneider National Inc. The truckload carrier is shuttering what it calls the First to Final Mile service it put together just three years ago with two acquisitions, the WSJ reports, highlighting the gap between freight business ambitions and reality in a residential delivery market driven by surging e-commerce demand. The growing willingness of consumers to buy heavy goods like furniture and appliances online is pushing more big-ticket items into residential delivery channels. But that business has confounded big trucking companies just as growing e-commerce package volumes have troubled parcel carriers. Experts say home delivery is costly to execute and that the labor-intensive services can be time consuming, making it tough to keep trucks and drivers on schedule. Schneider will focus instead on its core industrial services, and take pretax restructuring charges as it winds down the business.

Celadon Group Inc. has new financial backing for its turnaround efforts , and may be lining up for even bigger changes. The troubled truckload carrier struck a $165 million financing package that includes new loans and a credit facility, the WSJ's Michael Tobin reports, and comes with a provision that could have an unidentified shareholder take a stake in the company that would fall just short of 50% ownership. The carrier is trying to right itself after a troubled recent history that included a management overhaul following revelations over false financial statements. New leadership is also rebuilding the operations, and says the new financing will help Celadon replace aging trucks with new equipment. The trucker may not get much help from the broader market: Several competitors have reported lighter quarterly earnings and say pricing and demand have slipped from last year's heady levels.

QUOTABLE

IN OTHER NEWS

A measure of U.S. factory activity fell close to contraction territory in July. (WSJ)

China's yuan fell sharply to its weakest level of the year. (WSJ)

Oil prices fell at the steepest rate since 2015 amid tariff fears and reports projecting sharp growth in crude supplies. (WSJ)

Eurozone retail sales rose in June at the fastest pace since November 2017. (WSJ)

New jobless claims in the U.S. rose by 8,000 last week. (WSJ)

A grand jury indicted a Chinese billionaire on charges he evaded nearly $2 billion in tariffs in a conspiracy to smuggle massive quantities of aluminum into the U.S. (WSJ)

Steelmaking giant ArcelorMittal swung to a quarterly loss and said it plans to shed about $2 billion in assets. (WSJ)

ThredUp Inc. is nearing a new $100 million funding round that would value the apparel resale marketplace at $670 million. (WSJ)

Coffee prices have fallen to multiyear lows amid booming production in Brazil. (WSJ)

Lowe's Cos. is eliminating thousands of jobs and outsourcing the tasks to third-party companies. (WSJ)

Sales of pickup trucks to American buyers are helping Detroit's car companies counter a sputtering global auto market. (WSJ)

Moody's Analytics says Amazon.com Inc. hasn't violated antitrust restrictions because it has spurred investment by other retailers. (Sourcing Journal)

Amazon is in talks with India's Reliance Retail to acquire up to 26% of the country's largest bricks-and-mortar retailer. (Economic Times)

Kentucky coal miners are blocking CSX Corp. trains from carrying coal from a mine to demand back pay from a bankrupt mine operator. (Lexington Herald-Leader)

The U.K. government will try again to contract for extra ferry capacity for a potential no-deal Brexit. (Lloyd's List)

The Baltic Exchange will track shipping emissions in addition to its main business following dry-bulk transport. (Splash 247)

Singapore-based port operator PSA International bought the Halterm Container Terminal at Canada's Port of Halifax. (The Loadstar)

German industrial automation firm Eisenmann filed for insolvency and plans to restructure. (DC Velocity)

Hong Kong-based Cathay Pacific Airways will use blockchain technology to track its cargo containers. (Air Cargo News)

ABOUT US

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

Write to Paul Page at paul.page@wsj.com

(END) Dow Jones Newswires

August 02, 2019 10:39 ET (14:39 GMT)

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