Bubble Chart showing the flow of good in the supply chain
Port of LA - ONE container ship at terminal

SCAQMD Launches Enforcement Initiative of Warehouse Indirect Source Rule

The South Coast Air Quality Management District (SCAQMD) announced it is preparing to issue notices of violation to warehouse owners and operators who are in violation of its Warehouse Indirect Source Rule (Rule 2305), which has a phased-in compliance timeline that began in 2022. According to the SCAQMD, there are 2,000 warehouses currently subject to the rule, which include warehouses greater than 100,000 sq ft within the agency’s jurisdiction which includes large areas of Los Angeles, Orange, Riverside, and San Bernardino Counties. Of these warehouses, 1,400 are currently out of compliance. About 55% of warehouses that are required to submit reports in the first year have yet to do so. Violators of air quality rules can face civil penalties of up to $11,710 per day of noncompliance based on a strict liability standard.

The Rule requires warehouse operators to earn a specified number of WAIRE points annually, implement a custom plan, or pay a mitigation fee, which is estimated by the International Warehouse Logistics Assoc. and others to be $1 per sq ft. WAIRE points can be achieved by attracting or using zero-emission or near-zero emission trucks and cargo handling equipment or by installing solar panels or a zero-emissions charging and fueling infrastructure. Read more at SCAQMD.

Governor Newson

California Climate-Related Reporting Laws Enacted for Large Companies

The Governor of California signed into law, SB-253 and SB-261 climate-related reporting requirements for large companies doing business in CA, beginning in 2026. The bills require reporting assured by a third party (e.g., Lloyds Register) of greenhouse gas emissions (GHGs), in accordance with the Greenhouse Gas Protocol standards, and divides them into “scopes”. Scope 1: all direct greenhouse gas emissions that stem from sources that a reporting entity owns or directly controls. Scope 2: indirect greenhouse gas emissions. Scope 3: indirect upstream and downstream greenhouse gas emissions, other than scope 2 emissions. The laws apply to companies with gross revenues over $1 billion for SB-253 (GHG Reporting) or revenues over $500 million for SB-261 (financial risks). According to the Washington Examiner, SB-253 will directly affect 5,300 large companies in the state such as Apple and Amazon. However, the requirement for class 3 reporting will likely flow down to the smaller suppliers of the large companies, which will require their GHG emissions data. The reporting of SB-253 GHG emissions data will be required annually with administrative penalties up to $500,000 in a reporting year for noncompliance. The reporting of SB-261 financial risk data will be required every 2 years with administrative penalties of up to $50,000 in a reporting year. Read more at Washington Examiner and JD Supra.

Airport logistics center

Prologis Acquires 170-acre Industrial Park Adjacent to Phoenix Goodyear Airport

Prologis, the top U.S. Industrial Real Estate Investment Trust, has acquired the 170-acre Airpark Logistics Center in Goodyear, AZ from seller Creation Equity for $184 million  – the largest multi-building industrial park acquisition in AZ history, according to Creation.

Located adjacent to the Phoenix Goodyear Airport, the campus is comprised of 86 acres with 3 buildings of 1.4 million sq ft of leaseable space, recently completed, and 84 acres of undeveloped land for build-to-suit industrial projects. At full build-out, the project will span more than 2.7 million sq. ft. The purchase adds to other recent Prologis developments in the region, including a 112-acre 2-building industrial facility a few miles from the Airpark and another 114 acres it purchased in Goodyear for the Prologis Commerce Park in 2019. Phoenix is strategically located less than one day’s travel from key Western markets including Los Angeles, Las Vegas, Albuquerque, Tucson, and El Paso. Read more at TheRealDeal.

Maersk methanol ship at sea

Maersk Expands its Integrated Air Freight Network in Los Angeles

Maersk, one of the top Ocean Carriers, announced a planned expansion of its integrated air freight network with the inauguration of a new 130,000 sq ft import/export gateway facility located 15 miles from the Los Angeles International Airport (LAX) and 9 miles from the SoCal Ports. The self-managed air facility will provide direct planeside recovery with immediate unit load device transfers. The Los Angeles facility will complement Maersk’s growing integrated North American air freight network, which includes hubs in Atlanta and Chicago – both established within the last 12 months. The LAX facility will include a U.S. Customs-bonded Container Freight Station, TSA-Certified Cargo Screening Facility, Free Trade Zone, Customs Brokerage, and freight operations such as Less-than-Container-Load transloading. Read more at Maersk.

Rear view of a "Forward Air" truck on the highway

California Governor Vetoes Bill That Would Require Drivers on Autonomous Trucks

The Governor of CA vetoed Assembly Bill AB 316 on Sept 22nd, which would have banned autonomous trucks weighing more than 10,000 lbs from roads without a driver in the cab for the next 5 years. The bill was supported by the Teamsters because of its potential effects on jobs and safety. The Governor stated that existing law provides sufficient authority to create a regulatory framework on the issue. Existing regulations require human safety drivers of autonomous trucks over 10K lbs.

Widespread driverless autonomous truck deployments on designated routes are not expected before the middle of the decade. Currently, Maersk, a top Ocean Carrier, has begun testing driverless truck operations in its yard operations in Carson, CA, and on an autonomous trucking lane between a Plant in Houston and a Distribution Center in Oklahoma City. In cooperation with Kodiak Robotics, Maersk is transporting 53’ trailers using an autonomous truck with a safety driver on board 4 days per week, 24 hours per day. The run requires a stopover in Dallas to swap out safety drivers, which must still comply with driver hours of service regulations. Kodiak’s planned autonomous freight network will eventually require transfer point facilities at the end of long-haul routes, where freight is swapped between long-haul automated trucks and local human-driven trucks for first/last mile delivery. Read more at FleetOwner and Transport Topics articles: Newsom Vetoes Bill and Maersk Partners with Kodiak.

Outside view of JB Hunt Headquarters

Robots-as-a-Service Increasingly Adopted by Warehousing and Logistics Companies

Robots-as-a-Service (RaaS) is being increasingly adopted by the warehousing and logistics industry with the evolution of technology and the option being offered by more technology suppliers. Similar to Software-as-a-Service, RaaS provides the technology on a subscription basis, without the need for upfront capital investment purchase. According to Grandview Research, the global RaaS market is forecasted to have a Compound Annual Growth Rate to the year 2030 of 15% for the logistics market and 19.6% for the warehouse robotics market. RaaS typically provides users with greater speeds for implementation (e.g., within 1 month), scaling, and new technology upgrades. According to Autonomous Mobile Robot provider Vecna Robotics, RaaS can provide companies with a 45% cost reduction over manual methods. In addition to RaaS, Automated Storage and retrieval Systems (AS/RS) suppliers such as AutoStore and RightHand Robotics offer robotic equipment leasing or pay-per-pick models which are typically allocated to company operational expenses. Read more at Modern Materials Handling and Vecna Robotics.