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XPO Logistics Inc. is preparing to spend in a big way as it bulks up its business. Chief Executive Bradley Jacobs says the company is earmarking up to $8 billion for acquisitions and planning to add 10hubs to its e-commerce delivery network, WSJ Logistics Report's Jennifer Smith writes, accelerating its growth plan after XPO spent the past year digesting its past purchases. Mr. Jacobs had said in June that XPO was back in the hunt for acquisition targets, but the new details following a strong second-quarter earnings report suggest an ambitious scale that could sharply increase the company's geographic reach and its role in the global shipping market. Consolidation in the logistics field has been quiet since a spate of deals in 2015. Danish forwarder DSV A/S, which bought UTi Worldwide early last year, is signaling that it's also looking to get back into the market, suggesting that the logistics world's quiet period may coming to an end.
Mining companies have hit the mother lode of a critical commodity -- rich veins of cash. Anglo-Australian mining giant Rio Tinto PLC saw a big boost in net profit in the first half of the year to $3.3 billion, the WSJ's Robb M. Stewart reports, a strong reflection of an industry rebound that has gained momentum, benefiting from a recovery in prices of commodities including iron ore and coal as well as efforts to slash costs. Rio Tinto is winning applause from investors for its plan to boost dividends and buy back shares, but the broader commodities world is hoping that a long-awaited boost in production spreads more of the wealth around. Rio Tinto is developing new mines in Mongolia and Australia, and miners including Brazil's Vale SA and BHP Billiton Ltd., the world's biggest listed mining company, and Anglo American PLC are boosting output. Shipping industry researchers Alphabulk say the growing tonnage, along with China's ore production, should help a long-beleaguered dry-bulk shipping sector.
Boeing Co. is close to a big step in resetting its relationships with its suppliers as part of a broad overhaul of its aircraft manufacturing. The jet maker reached a provisional agreement to settle one of its thorniest supplier issues, the WSJ's Robert Wall and Doug Cameron report, setting up a long-term deal with Spirit AeroSystems Holdings Inc. that Boeing believes will deliver long-term savings. Negotiations between the world's No. 1 plane maker and its biggest supplier have run for years and been contentious at times. The battle highlights the rancor that can spread through supply chains as companies seek cost cuts that inevitably hit the earnings of parts providers. Boeing is undertaking what it calls a Partnering for Success program which calls for concessions from the suppliers to help Boeing improve its margins. Spirit will gain certainty with a pact that runs through 2022 while Boeing will cut costs now and gain the potential for significant savings for future aircraft that may be under development.
ECONOMY & TRADE
Trade tensions between the U.S. and China are growing, and that could undercut the flow of investment and goods between the countries. The Trump administration is planning a series of tough new trade measures to force Beijing to crack down on intellectual-property theft and ease demands on American companies that went to enter the Chinese market. The WSJ's Jacob M. Schlesinger and Bob Davis report that the administration is considering invoking a little-used provision of U.S. trade law to investigate whether China's intellectual-property policies constitute "unfair trade practices," potentially paving the way for the U.S. to impose sanctions on Chinese exporters. The focus on intellectual property marks a shift for an administration that has mostly talked about Chinese manufacturing and China's $347 billion trade surplus with the U.S. last year. The goods trade between the countries amounted to $237.14 billion in the first five months of this year, with about three-quarters of it flowing from China to the U.S.
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IN OTHER NEWS
Companies are racing to develop "collaborative" robots that work alongside humans in warehouses. (WSJ)
Transportation stocks have been declining in recent weeks, out of step with broader gains in the stock market. (WSJ)
Hiring at private U.S. employers slowed more than expected for the second consecutive month. (WSJ)
The mobility of the U.S. population has fallen by almost half since its most recent peak in 1985. (WSJ)
Tesla Inc. lost a lower-than-expected $336 million in the second quarter as revenue more than doubled. (WSJ)
AutoNation Inc. is opening used-car dealerships as it looks from relief from a faltering market for new vehicles. (WSJ)
Qatar Airways dropped plans to buy a big stake in American Airlines Group Inc. (WSJ)
A federal judge in Seattle dismissed a suit seeking to block unionization efforts at ride-hailing companies Uber Technologies Inc. and Lyft Inc. (WSJ)
Snack food giant Mondelez International Inc. says the June malware attack decreased organic revenue by more than 2%. (WSJ)
Container shippng spot rates from Asia to the U.S. from Asia have been soaring since late June as companies build up inventories ahead of the Christmas rush. (Nikkei Asian Review)
CMA CGM SA is in talks to buy up to six container ships with capacity for 22,000 20-foot containers that would break current records for vessel scale. (Lloyd's List)
Global air freight traffic grew in the first half of the year at the fastest rate in seven years. (Air Cargo News)
Shoe maker Keen Footwear says new manufacturing techniques are making it more economical to make shoes in the U.S. (Sourcing Journal)
Less-than-truckload carriers are undertaking a mini-boom in construction, adding terminals and expanding existing sites amid steady demand growth. (Journal of Commerce)
U.S. Xpress Enterprises Inc. laid off 100 workers as part of what the truckload carrier said was a "shift in company focus." (WRCB)
U.S. diesel fuel prices have increased for five straight weeks. (Logistics Management)
Lufthansa Group's earnings jumped 75% on improving demand and cost cuts, while pricing gains helped move the cargo division into the black. (FlightGlobal)
Danish freight forwarder DSV A/S is investing in e-commerce services to address competition from new players including Amazon.com Inc. (Reuters)
Second-quarter profit at container ship leasing company Seaspan Corp. fell 22.4% to $28.3 million. (American Shipper)
The Reading & Northern Railroad will supply the cars for Pennsylvania-based Xcoal Energy and Resources to ship 700,000 tons of coal to Ukraine. (Progressive Railroading)
Michigan-based storage rack provider Speedrack says e-commerce is fueling rapid growth in its business. (Michigan Live)
Paul Page is deputy editor of WSJ Logistics Report. Follow him at @PaulPage, and follow the entire WSJ Logistics Report team: @brianjbaskin , @jensmithWSJ and @EEPhillips_WSJ. Follow the WSJ Logistics Report on Twitter at @WSJLogistics.
Write to Paul Page at email@example.com
(END) Dow Jones Newswires
August 03, 2017 07:07 ET (11:07 GMT)