Today's Top Supply Chain and Logistics News From WSJ

By Paul Page Features Dow Jones Newswires

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A new trade dispute between the U.S. and Mexico is taking root in the rich farmland northeast of Mexico City. Fed by growing American demand, the region has seen an explosion in berry farming, the WSJ's Robbie Whelan writes, drawing charges from U.S. growers that Mexico's exporters are outflanking their goods with cheaper, year-round berries. The complaints from farmers from Florida to California come as talks to redo the North American Free Trade Agreement resume this week and highlight the complicated trading relationship between the countries that Nafta has fostered. The trade pact has opened a big American market to Mexico's farmers and brought out-of-season goods to U.S. households. Small U.S. farmers say they're doing that by dumping goods at below cost. Yet some large U.S. growers oppose the complaints. They typically operate farms in all three Nafta countries and worry that U.S. protectionist measures could spark retaliatory duties by Mexico and Canada, undermining long-established supply chains.

The "Amazon effect" is hitting a wall at the high end of the retail market. Owners of big luxury brands including Swatch Group and LVMH Moët Hennessy Louis Vuitton SE are resisting Amazon.com Inc.'s pitches to join the marketplace, the WSJ's Matthew Dalton and Laura Stevens report, undercutting the e-commerce leader's bid to expand its reach and move up the profit-margin ladder. Some brands have signed on, but many in the luxury industry say Amazon's online marketplace undermines the strict control they say is key to maintaining exclusivity and high prices. And they say Amazon won't commit to proactively police its site for counterfeits and unauthorized retailers. The issues bare a central divide between Amazon and many retail brands: the company is concerned about counterfeits but is reluctant to stop third-party sellers from offering legitimate products outside the brands' approved distribution channels. The luxury brands believe their grip on distribution helps separate them from more affordable goods -- at least for now.

Belgium's postal service is trying to take a bigger role in the global e-commerce market. The group known as bpost is buying U.S. logistics business Radial for $820 million, WSJ Logistics Report's Jennifer Smith writes, joining moves by postal operators to move beyond traditional mail into areas of e-commerce and logistics. Radial is the former eBay Enterprise fulfillment business and reaches into the online retail market with a network of 24 warehouses and distribution services that it pitches as tools for sellers to compete with Amazon. Like other postal operators, bpost is acting as traditional mail dwindles while demand for parcels and the logistics behind online sales grows. The drive has led to some stumbles: Japan Post took a big impairment charge this year on its two-year-old acquisition of Australian logistics business Toll Holdings. Radial opens a new market for bpost but the business now will have to figure out how to integrate Radial into an operation still built to handle mail.

MANUFACTURING

General Motors Co. is facing a supply glut and it goes beyond automobiles on dealer lots. Despite its drastic downsizing a decade ago, the top U.S. auto manufacturer by sales finds itself with too many factories that can turn out too many vehicles. The imbalance is undermining GM's finances, the WSJ's Mike Colias writes, and undercutting the company's attempts to adjust its supply chain to a North American market that's getting tighter and seeing demand move in different directions. GM's factory-utilization rate -- a critical measure of manufacturing efficiency -- runs well behind that of Ford Motor Co. and Toyota. GM has cut some factory shifts to restrain costs, but the company faces political pressure as President Donald Trump pushes auto makers to assemble more of their vehicles in America. Adding to the strain: GM must contend with its capacity glut at the same time the company is making costly investments in electric cars and self-driving vehicles.

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QUOTABLE

IN OTHER NEWS

The sole fleet of unionized truck drivers at C.R. England Inc. voted to decertify its union, a blow to organized labor as it tries to expand its reach in logistics operations. (WSJ)

Mexico produced a record number of cars and light trucks in September, backed by greater exports to the U.S., Canada and Europe. (WSJ)

GM acquired Strobe, a California-based startup that makes sensors that helps autonomous vehicles navigate. (WSJ)

Wal-Mart Stores Inc. will allow online customers to quickly return goods to stores using a smartphone app. (Associated Press)

Hong Kong oil trader Titan Petrochemical bought Chinese shipyard Jiangsu Hongqiang Marine Heavy Industry for $27 million. (IHS Fairplay)

Siemens AG took a minority stake in Wi-Tronix, a provider of cloud-based software for predictive maintenance of rail equipment. (Progressive Railroading)

Boatloads of produce are stuck on ships in the Gulf of Mexico awaiting clearance to use shipping channels hit by Hurricane Nate. (Gulfport Sun Herald)

Analysts Statistics MRC expect bulk handling at port terminals around the world to grow at a 5.1% compound annual rate through 2023. (Port Technology)

Kenya is restricting some freighter flights out of Nairobi, narrowing cargo capacity for flower exporters. (The Loadstar)

Demand from marijuana growers is pushing up the prices for warehouse properties in the Sacramento, Calif., area. (Sacramento Bee)

Industrial parts supplier NEFCO Corp. acquired Florida-based construction equipment provider Tekk Supply. (Industrial Distribution)

A cargo loader at Hong Kong International Airport caught fire while handling an American Airlines freight load. (USA Today)

Pacific Northwest potato farmers are struggling to find trucking service in the midst of their peak shipping season. (Skagit Vally Herald)

ABOUT US

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 paul.page@wsj.com

(END) Dow Jones Newswires

October 10, 2017 06:40 ET (10:40 GMT)