Logistics Report: Smarter Spirits Shipping; Resetting Auto Assembly; Export-Import Revival
Date: Thursday, May 9, 2019
Source: The Wall Street Journal
Absolut’s latest formula for its global vodka supply chain includes a big dose of machine learning. The brand is turning to the latest software to help the company maintain the production principles Absolut has built over 140 years, the WSJ Logistics Report writes, highlighting how technology can help blend decidedly old-school fundamentals with contemporary global distribution. Absolut is using artificial intelligence to align its demand forecasting with a tight and highly-localized sourcing and production plan. Changing consumer tastes and an increasingly competitive spirits market have put pressure on the company’s supply chain, and the proliferation of flavors and products has made distribution from source to final sales more complicated while raising the stakes for managing inventory. Improved demand forecasting has helped Absolut maintain production in a small village in southern Sweden, with most suppliers within a four-hour drive from its single, very busy distillery.
A factory at the center of shifting fortunes in North American manufacturing may find new life. General Motors Co. is in talks to sell its shuttered assembly plant in Lordstown, Ohio, to an electric-truck maker, the WSJ’s Mike Colias, Paul Vieira and Christina Rogers report, a potential new step in a broader overhaul of North American automotive supply chains. GM says it is in discussions to sell the factory to electric-truck maker Workhorse Group Inc. and a new startup led by the small company’s founder. The plant’s closing has drawn heavy political attention, but it comes amid broader moves in the company’s vehicle production. GM says it has earmarked $700 million to invest across three of its factories in Ohio. And its Canadian unit is converting an Oshawa, Ontario site into a parts-making operation once vehicle assembly stops at the end of the year, as originally planned.
Economy & Trade
The U.S. Export-Import Bank is alive again, at least for a while.The U.S. Senate confirmed three Trump administration picks to serve on the bank’s board, the WSJ’s Andrew Ackerman reports, reviving a long-hobbled agency that helps finance export deals between U.S. manufacturers and overseas buyers. Some $40 billion in export deals have languished since the board lost its quorum four years ago, depriving it of the ability to approve deals of more than $10 million. The Ex-Im Bank has been caught in a political tug-of-war for several years, with critics complaining its backing amounts to corporate welfare while supporters argue it puts U.S. firms on a level playing field with other countries that offer financing for their domestic manufacturers. Business groups praise the action, but the revival could be short-lived. Congress must act again by Sept. 30 to reauthorize the bank for another five years.