Afternoon Coffee: Companies in Tianjin Feeling Logistical Impacts of Blast, US Auto Assembly Boosts July Factory Production

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Companies doing business in Tianjin, China, where a chemicals storage warehouse exploded earlier this week, are experiencing shipping and port operation delays already. Companies like Renault SA reported 1,500 cargo cars were destroyed in the blast, and Chevron Corp. said it suspended operations at a nearby lubricants facility.  

Automotive production in July reached its highest level since 1978, which caused overall US factory activity to increase 0.8% for the month. The July jump is also the biggest since November and reverses the 0.3% fall seen in June.

Two automakers have announced recalls, however, due to airbag defects. General Motors is recalling 73,000 2010 Chevrolet Cobalts vehicles and Volkswagen is recalling 420,000 cars in the US due to problems that can prevent the airbags from deploying in a crash.

Union Pacific plans to cut hundreds of management jobs due to the decline in rail shipments of coal, which is expected to continue the remainder of 2015. The railroad company said its coal volume fell 26% during the most recent quarter.

 

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