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Westlake Legal Group > Posts tagged "Fedex Corporation"

How to Ship a Vaccine at –80°C, and Other Obstacles in the Covid Fight

Many things will have to work out to end the coronavirus pandemic. Drug companies will have to develop a safe and effective vaccine. Billions of people will have to consent to vaccination.

But there are more prosaic challenges, too. Among them: Companies may have to transport tiny glass vials thousands of miles while keeping them as cold as the South Pole in the depths of winter.

A number of the leading Covid-19 vaccines under development will need to be kept at temperatures as low as minus 80 degrees Celsius (minus 112 degrees Fahrenheit) from the moment they are bottled to the time they are ready to be injected into patients’ arms.

That will not be easy. Vaccines may be manufactured on one continent and shipped to another. They will go from logistics hub to logistics hub before ending up at the hospitals and other facilities that will administer them.

While no vaccine has yet been approved by health officials in the United States, preparations for a mass-vaccination campaign are gearing up. The U.S. military and a federal contractor are expected to play a role in coordinating the distribution. But a hodgepodge of companies are scrambling to figure out how to keep hundreds of millions of doses of a vaccine very, very cold.

Planes, trucks and warehouses will need to be outfitted with freezers. Glass vials will need to withstand icy climes. Someone will need to make a lot more dry ice.

“We’re only now beginning to understand the complexities of the delivery side of all of this,” said J. Stephen Morrison, senior vice president at the Center for Strategic and International Studies, a research firm. “And there’s no getting around it. These have stark temperature demands that will constrain access and delivery.”

ImageWestlake Legal Group merlin_176725947_41dff0d8-d1cb-4a42-b819-e6aa87c4e4da-articleLarge How to Ship a Vaccine at –80°C, and Other Obstacles in the Covid Fight Vaccination and Immunization United Parcel Service Inc Shortages Pfizer Inc Moderna Inc Ice Fedex Corporation Coronavirus (2019-nCoV) Corning Inc Centers for Disease Control and Prevention Carbon Dioxide BioNTech SE AstraZeneca PLC
Credit…Hans Pennink/Associated Press

President Trump on Friday asserted that hundreds of millions of doses of an unidentified vaccine will be available to all Americans by April. That timeline is more ambitious than what his own advisers have described. Dr. Robert R. Redfield, the director of the Centers for Disease Control and Prevention, told a Senate committee on Wednesday that a vaccine would not be widely available until the middle of next year.

Of the three vaccines that have advanced to Phase 3 trials, two — one made by Moderna and the National Institutes of Health, the other by Pfizer and BioNTech — need to be kept in a near constant deep freeze. (They are made with genetic materials that fall apart when they thaw.) Another leading vaccine candidate, being developed by AstraZeneca and Oxford University, must be kept cool but not frozen.

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McKesson, a major drug distributor, won a major federal contract last month to help distribute a coronavirus vaccine. Much of the work, however, will fall to companies outside the medical and drug industries. The major U.S. logistics companies, including UPS and FedEx, already have networks of freezers that they use to ship perishable food and medical supplies. The companies have experience shipping vaccines for other illnesses, including the seasonal flu.

But the Covid-19 vaccination effort is likely to dwarf all previous campaigns.

UPS said it was constructing a so-called freezer farm in Louisville, Ky., the company’s largest hub, where it can store millions of doses at subzero temperatures.

Creating an entire warehouse that could maintain that deep freeze would have been too complex and costly. So instead, rows of upright industrial Stirling Ultracold freezers, each capable of holding 48,000 vials, are being arranged inside a warehouse. There are 70 freezers so far, but the warehouse could fit a few hundred. A similar UPS center is in the works in the Netherlands.

“I haven’t seen anything like this before,” said Wes Wheeler, UPS’s head of health care. “Nothing has been quite this global in scale.”

Credit…FedEx

At FedEx, the vaccine preparations are being led by Richard W. Smith, the son of the company’s founder, Fred W. Smith. The younger Mr. Smith, who runs the company’s airline operations in the Americas, was in charge of the life sciences business for FedEx’s airline operations in 2009, during the H1N1 pandemic. At the time, the U.S. government asked FedEx to prepare to help transport vaccines, Mr. Smith said, and the company doubled its number of freezers around the globe.

“Fortunately, H1N1 did not rise to the level of the pandemic we thought it could be,” he said. “But that allowed us to really beef up our cold-chain infrastructure.”

In the years after that scare, FedEx expanded its supply of freezers and worked with the Federal Aviation Administration to win approval for its planes to carry more dry ice. (When dry ice melts, it emits carbon dioxide, making the air on planes potentially unsafe for pilots and crew.)

Now FedEx is adding freezers that can maintain temperatures as low as minus 80 Celsius in cities including Memphis, Indianapolis and Paris. It is installing additional refrigerated trailers in Oakland, Calif., Dallas and Los Angeles, which could be used for vaccines that need to be served chilled, not frozen.

“The demand for this is huge,” Mr. Smith said. “We know it’s going to be a very substantial market.” Analysts at Citi agreed, saying the business of transporting vaccines is likely to be profitable in a recent note suggesting that FedEx stock was a good investment.

As if the challenge weren’t sufficiently daunting, the world is facing a looming shortage of dry ice — an unexpected side effect of the pandemic.

Dry ice, the stuff that exudes chilly smoke and enthralls school-age scientists, is made from carbon dioxide, which is most commonly created as a byproduct during the production of ethanol.

But ethanol production ebbs and flows based on the demand for gasoline. This spring, as stay-at-home orders went into effect, people began driving less. As a result, ethanol production slumped, and so did the supply of carbon dioxide.

In April, Richard Gottwald, chief executive of the Compressed Gas Association, sent a letter to Vice President Mike Pence warning of “a significant risk of a shortage in carbon dioxide.”

Five months later, “the ethanol industry still has not bounced back,” Mr. Gottwald said in an interview. “We are seeing a shortage.” And that is making dry ice hard to come by.

For much of the summer, Marc Savenor, owner of Acme Dry Ice in Cambridge, Mass., which supplies medical companies, has been running low on carbon dioxide. Supply was the tightest he had seen in his 42 years of business, forcing Mr. Savenor to ration his dry ice.

“It was like a McDonald’s with no hamburgers,” he said, adding that carbon dioxide seemed to more plentiful in recent weeks.

Credit…UPS

UPS and FedEx are taking matters into their own hands. FedEx already has machines in warehouses that can produce dry ice, and UPS said it was considering adding them.

The companies will also have to provide their delivery employees with special training and equipment like gloves to handle their icy wares.

Pfizer has designed a special box to transport its hoped-for vaccine. The boxes, roughly the size of a large cooler, will hold a couple of hundred glass vials, each containing 10 to 20 doses of vaccine. The boxes are equipped with GPS-enabled thermal sensors, allowing Pfizer to know where the boxes are and how cold they are. (If they get too warm, workers can add dry ice.)

All of this leads to another problem: Glass often cracks in extreme cold.

Early this year, Corning, a 169-year-old glass maker in upstate New York, approached officials at the Department of Health and Human Services with a warning: There wouldn’t be enough cold-resistant glass vials to handle a frozen vaccine, said Brendan Mosher, Corning’s head of pharmaceutical technologies.

Credit…Corning

Corning pitched a solution. It could make millions of vials with a new type of pharmaceutical-grade glass that can withstand the lowest temperatures. In June, the government awarded the company a $204 million contract to increase its production of the special vials. The new glass is made without boron, a common ingredient in conventional glass that can lead to contamination of whatever is in the vials.

Mr. Mosher said Corning was using the federal money to quadruple the capacity at its plant in Big Flats, N.Y.; to accelerate construction of a glass furnace in New Jersey; and to speed up construction of an additional plant in North Carolina. Corning is hiring 300 workers and says it is on track to start producing hundreds of millions of glass vials next year.

Even if there is enough dry ice and chilled warehouses and sturdy vials, everyday pharmacies are unlikely to be equipped to stockpile large quantities of vaccines that require ultracold storage. Nevertheless, they might be able to keep Pfizer’s cooler-size boxes on hand, and Moderna’s vaccine can be stored at less extreme temperatures in the days before it is administered.

In a presentation to the White House coronavirus task force last month, Kathleen Dooling, a disease expert with the C.D.C., said strict temperature requirements “will make it very difficult for community clinics and local pharmacies to store and administer.” She said the vaccine would have to be dispensed “at centralized sites with adequate equipment and high throughput.” It’s not clear where those sites will be or who will administer the vaccines.

That is just in the United States. A vaccine requiring stringent temperature controls would be off limits for much of the developing world. A recent study by DHL and McKinsey found that a cold vaccine would be accessible to about 2.5 billion people in 25 countries. Large parts of Africa, South America and Asia, where super-cold freezers are sparse, would be left out.

“The consequence is to reinforce the staggering bias in favor of the wealthy and powerful few countries,” said Mr. Morrison, of the Center for Strategic and International Studies.

Real Estate, and Personal Injury Lawyers. Contact us at: https://westlakelegal.com 

Reopening Prompts New Agitation Over Workers’ Virus Exposure

Riley Breakell, a Starbucks barista in Connecticut, was reassured in mid-March when the company sent a letter announcing expanded catastrophe pay for those absent because of the pandemic. Even though she couldn’t live on the roughly $250 per week she received from Starbucks while her store was closed for a month and a half, she appreciated the company’s effort to do right by its employees.

But after the company said those provisions would cease for those who were able but “unwilling to work” as stores reopened last week, Ms. Breakell became increasingly frustrated, questioning her managers over the risks that workers would encounter.

“The first letter they sent said you should not have to choose between your health and a job, and now they’re like, ‘Well, if you don’t want to go back, you have to quit,’” she said last week, shortly before her first day back. “I’m very anxious.”

Early in the coronavirus pandemic, workers like Ms. Breakell spoke up and staged protests to demand that employers provide protective equipment, limit customer traffic or even shut down in the interest of safety. But as many companies return to business, workers are pursuing a new goal: that employers not prematurely roll back measures they put in place.

Employees of Target, some of whom walked off their jobs on May 1 over working conditions, have raised concerns about the company’s decision to resume accepting returns from customers, a service that had been suspended to reduce potential virus exposure.

Some workers at Amazon, who also joined the May Day protests, said they were upset over the end of the company’s policy of unlimited unpaid time off, which many had used to avoid exposure inside warehouses.

And workers at Costco and Whole Foods Markets, which is owned by Amazon, have expressed alarm that their employers appear to be relaxing limits on the number of customers in their stores. Workers at three Whole Foods locations in California said their stores had significantly more customers than usual on some days in the past two weeks.

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“Over the Mother’s Day holiday weekend, it seemed that we had nobody monitoring the door,” said Kai Lattomus, a Whole Foods worker in Laguna Niguel. “We had lines that went all the way back to the end of the aisle.”

A Whole Foods spokeswoman said that the company’s social distancing and crowd control measures remained in place, and that the number of customers in a store could vary because of local ordinances and staffing.

Richard Galanti, Costco’s chief financial officer, said that all workers and customers, known as members, must wear face coverings and that the company had expanded store hours to help reduce crowds.

“We continue to make sure the number of members is at safe levels and that they are properly distanced,” he said. The concerns at Costco were reported earlier by BuzzFeed.

The workers speaking out say they are pressing for many of the measures they have pushed for since the pandemic began: more generous and accessible sick leave policies, more protective equipment and better hazard pay.

Ms. Breakell, the Starbucks worker in Connecticut, said workers had been trained to handle mobile ordering procedures that the store had adopted for its reopening, which she acknowledged would be safer than having customers order and pay inside. But she said it was difficult for workers to keep a distance from one another and expressed concern that the ordering policy might not last, citing conversations with supervisors.

A Starbucks spokeswoman said the company was taking several steps to ensure that only healthy employees went to work, such as temperature checks and paid leave for those who may be ill. (Others can apply for unpaid leave.) Workers are required — and customers are asked — to wear facial coverings, she said, and the company is trying to adjust schedules with social distancing in mind.

The company has no plans to allow customers to linger in stores, according to the spokeswoman, who forwarded a number of internal messages from employees expressing gratitude and excitement that their stores were reopening.

The frustrations among workers at various companies have motivated some to begin coordinating their protests.

Nationally, participants in the May Day protests said they had communicated through a group on the encrypted messaging app Telegram that brought together workers and organizers at Instacart, Whole Foods, Amazon and FedEx. Among them was Christian Smalls, who was fired from his job at an Amazon warehouse in Staten Island after leading a protest there in late March. Amazon said Mr. Smalls had violated its social distancing rules.

But there appear to be tactical differences among workers, even at the same company. A Chicago-based group of Amazon workers, DCH1 Amazonians United, released a statement that questioned whether the May Day walkout was the best approach.

“Calling for a general strike is easy — organizing one is not,” the statement said. “Before taking action we’ve got to get organized.”

The anxiety among workers appears to be tied partly to broader policy approaches by political leaders in their cities and states. Willy Solis, a shopper and organizer in the Dallas area for Shipt, a delivery service owned by Target, said he was concerned by the increase in crowds he had observed since Gov. Greg Abbott lifted a stay-at-home order on May 1.

ImageWestlake Legal Group merlin_172348455_c3377980-6ae1-48e4-a972-81113e5f608a-articleLarge Reopening Prompts New Agitation Over Workers’ Virus Exposure Workplace Hazards and Violations Whole Foods Market Inc United Food and Commercial Workers Union Target Corporation Strikes Starbucks Corporation Shutdowns (Institutional) Shopping and Retail Protective Clothing and Gear Organized Labor Labor and Jobs Instacart Fedex Corporation Costco Wholesale Corporation Coronavirus (2019-nCoV) Amazon.com Inc
Credit…Allison V. Smith for The New York Times

“That’s a fear of mine for sure,” said Mr. Solis, who took part in the May Day walkout. “The opening up of businesses to the general public will create an environment where the coronavirus can rear its ugly head, spread further.”

Mr. Solis said he had greatly reduced his hours since the pandemic’s onset because of an autoimmune disorder. He said that Shipt had agreed to provide workers with masks but that many, including him, could not obtain them consistently.

“I’m afraid I wouldn’t make if I caught this virus,” said Mr. Solis, who is 41.

A Shipt spokeswoman said that workers could pick up masks at any Target location and that the company had sent kits including gloves and hand sanitizer to workers who requested them. Mr. Solis said that masks were not available at every Target he checked and that some locations said the masks were intended only for Target employees, not Shipt workers.

By contrast, in Illinois, where Gov. JB Pritzker has moved to tighten some safety protocols in the past two weeks — for example, by requiring a face covering in indoor public spaces — workers and labor leaders said they felt most large employers were taking safety concerns seriously.

Bob O’Toole, the president of United Food and Commercial Workers Local 1546 in Chicago, which represents about 19,000 grocery, meatpacking and food-processing workers, said his union had been meeting regularly with regional grocery stores and asking them to make additional protective equipment available and to install plastic shields around cashiers.

“Our retailers have been cooperative — they’ve been responsive,” Mr. O’Toole said, a reaction he attributed partly to the tone set by Mr. Pritzker and the state government.

Marc Perrone, the president of the United Food and Commercial Workers International, said the union planned to begin advocating for the interests of nonunion workers as well as its more than one million members.

“The last four, five, six, seven weeks, we’ve been focusing on making sure our folks had personal protective equipment, that people were getting their pay, that we were addressing those issues legislatively,” he said. “We’re going to do the same thing on their behalf, to put some weight behind them.”

Real Estate, and Personal Injury Lawyers. Contact us at: https://westlakelegal.com 

3 Vans, 6 Coolers, a Plane, a Storm and 2 Labs: A Nasal Swab’s Journey

Westlake Legal Group 3-vans-6-coolers-a-plane-a-storm-and-2-labs-a-nasal-swabs-journey 3 Vans, 6 Coolers, a Plane, a Storm and 2 Labs: A Nasal Swab’s Journey Virginia Teterboro (NJ) Tests (Medical) Quest Diagnostics Inc Quarantines Paramus (NJ) Nursing and Nurses New Jersey Laboratories and Scientific Equipment Fedex Corporation Coronavirus (2019-nCoV)
Westlake Legal Group merlin_171490422_6f2eb368-294e-4ca6-9196-71c80ab281da-facebookJumbo 3 Vans, 6 Coolers, a Plane, a Storm and 2 Labs: A Nasal Swab’s Journey Virginia Teterboro (NJ) Tests (Medical) Quest Diagnostics Inc Quarantines Paramus (NJ) Nursing and Nurses New Jersey Laboratories and Scientific Equipment Fedex Corporation Coronavirus (2019-nCoV)

The lines start forming the night before, as people with glassy eyes and violent coughs try to get tested for the virus. In the darkness, they park their cars, cut their engines and try to sleep.

The backlog for coronavirus testing in New Jersey, the state with the second-highest caseload in the country, has been getting worse, not better, officials say.

So far, New Jersey has conducted over 115,000 tests, about one for every 75 residents. Across the river in New York, the epicenter of the crisis, there is about one for every 18. The tests are a critical tool in measuring the disease’s spread and a requirement for certain forms of treatment. Yet they remain hard to get, and many are actively discouraged from trying.

“It’s unequivocally worsening,” Gov. Philip D. Murphy of New Jersey said recently, adding, “We’ve got constraints in the entire food chain.”

Initially, the strain came from a lack of test kits, but now there are not enough nasal swabs, not enough nurses. There is a pileup at the labs themselves and a limited supply of the chemicals needed to identify the virus.

Two weeks ago at the Bergen Community College in Paramus, a drive-through FEMA testing site in the hardest-hit area of New Jersey, residents had to arrive by 3 a.m. to get a spot. Within days, they were told to show up at 11 p.m. the night before.

On Monday of last week, Anita Holmes-Perez felt so sick that she asked her husband to drive her there even earlier, at 10:45, but a car was already ahead of her. The entrance was blocked off by an armored personnel carrier; members of the National Guard idled in camouflage nearby.

Ms. Holmes-Perez spent the night constantly adjusting the reclining seat inside her Mercedes S-Class, lying down until the congestion in her chest forced her to sit up again.

She was battling a fever, a cough, dizziness and a feeling of confusion. “Like you don’t know where you are,” the 45-year-old said. “You forget what you’re doing.”

When medical workers finally took a sample from her the next morning, it would be shipped across the country because the local lab was too full. Three vans would take it part of the way. A plane, sent on a detour by a storm, would take it further. It would be days before she got a result. Until then, Ms. Holmes-Perez waited.

Shortly before the drive-through opened at 8 a.m. last Tuesday, a police car drove up and down the mile-long line of parked vehicles, sirens blaring.

“I think they did it to wake us up,” said 29-year-old Kayla Codina, who had spent the hours before dawn swiping through TikTok, too anxious to sleep inside her Ford Fusion.

When testing finally began, the cars surged forward, approaching a triage site marked in orange cones.

From a distance, the station appeared to be manned by astronauts. The nurses were wearing face shields and bright white scrubs, their first names written in black marker on the front along with the digits 0800: the hour they got suited up. A grid of temperatures and times advised how long before they would need to discard the uniforms.

“Please roll up your window,” one of the nurses said. “Higher, please.”

The people coming to get tested are not allowed out of their cars, and their windows can be open no more than an inch — just enough for workers to slip in a pink square of paper with a number on it. They give out only 500 numbers a day.

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Before patients can get one, they are asked to hold their New Jersey drivers’ licenses against the glass to prove they are residents. On previous days, desperate people drove in from out of state.

Those with no symptoms are also turned away. When the medical staff asked Ms. Codina to describe how she was feeling, she said she could no longer take a full breath. She was handed Square No. 14, allowing her to drive a few dozen feet up to a white tent.

Farther down the line, Andres Chia, 54, who had tested positive days earlier, was worried that he had infected his younger brother and their 84-year-old father. The nurse handed them Nos. 145 and 146 and waved their Nissan forward.

“My father keeps asking: ‘Is it my time now? Is this how I am going to go?’” said the younger brother, Israel Chia, 44.

A nurse leaned in with a long Q-tip but was corrected by her manager. “Tell him to face forward,” he said to her.

When she inserted the swab into the older man’s nose, pushing as far back as it could go, he erupted into an explosive cough, the kind that aerosolizes the virus, sending tiny, potentially dangerous droplets into the air, most of them trapped inside the Nissan.

By midafternoon, they’d run out of tests. Workers placed the day’s work — hundreds of test tubes in plastic bags — into two large boxes covered in ice packs.

Douglas Ortmann, a 20-year FedEx veteran, eased the two boxes into his empty van. Since screening began weeks ago, he has waited for the phone call each day, dashed to the Paramus testing site and then driven the samples to Teterboro, 14 minutes away.

“I understand how important it is,” he said.

At 2:55 p.m., the van pulled into the loading dock of Quest Diagnostics’ flagship lab.

As tests were underway in the drive-through, their destination was being decided 900 miles across the country.

In Brookfield, Wis., Quest’s executive vice president James E. Davis was working from home, like much of the country. The floor-to-ceiling windows of his home office face a verdant lawn, but his eyes were trained on his desktop monitor, where he had loaded a spreadsheet of how many nasal swabs each of his labs had received.

This much was obvious: The Teterboro lab, one of the company’s largest, was overwhelmed. Over the preceding 24 hours, FedEx drivers like Mr. Ortmann had arrived with samples from elsewhere in New Jersey — including hospitals, whose patients take priority over those at drive-throughs — and from New York.

While other countries quickly ramped up screening, the United States lost valuable time. It wasn’t until late February that private labs were given the go-ahead to create tests of their own.

Quest began with a test in a single lab in California, and has since expanded screening to 12 locations. It can process 35,000 specimens a day, though not at the same facility. A fleet of 23 planes ferry coolers of nasal swabs to one lab or another.

New Jersey’s state-operated lab runs no more than 70 tests a day, according to Christopher Neuwirth, an assistant commissioner at the state’s Health Department. Some hospitals can do on-site tests, but they’re a drop in the bucket. So the burden has fallen on private labs like Quest, whose workload comes from all over the nation.

Mr. Neuwirth said that was hurting New Jersey right now, because it sits within driving distance of New York. “We happen to be in a region with all these hot spots, and when you have commercial labs doing this across the country, every state competes to get their tests done,” he said.

At Quest, Mr. Davis jumps on a conference call twice a day to decide which labs have wiggle room and which don’t. For much of last week, the Teterboro lab was at capacity, with almost half its caseload from high-priority hospital patients.

Before the FedEx van pulled up to the 250,000-square-foot lab in New Jersey, Mr. Davis’s decision was already made: The test tubes would be diverted to a lab in Chantilly, Va.

Workers brought them inside to prepare them for the next leg of the journey. Two women in lab coats created a manifest, logging each patient’s information into a computer. The specimens were moved to six coolers the color of key lime pie and packed with dry ice.

At 1:24 a.m. on Wednesday, another van drove them to the airport across the street, where a small single-engine plane was waiting. The pilot, George Fendley, would be flying solo, as he did several times a week. If there ever were passenger seats inside the plane, they’d been ripped out, the coolers filling the belly of the aircraft.

It was less than an hour to Virginia, about 270 miles away, and the plane took off at 1:53 a.m. Along the way, Mr. Fendley flew into a thunderstorm and had to touch down in Pennsylvania. He took off again, trying to skirt around the lashing winds and rain. When he landed, it was 4:28 a.m.

Another van drove the cargo 27 minutes to Chantilly. Soon the sun was rising, and as the operators unpacked the samples, almost 24 hours had elapsed.

At the drive-through, New Jersey residents had been told to expect a three- to five-day wait. “Do you know if they mean business days or regular days?” Ms. Codina later asked.

In an effort to alleviate the strain on the system, some doctors have advised patients to avoid testing.

That was the case for Ms. Holmes-Perez, who received the following message from her doctor’s office: “There is no benefit to being tested as you probably would not qualify anyway. Just stay on your medications.”

But with each passing day, her symptoms worsened. She struggled to breathe. Then she started to slur her speech. Next she began to feel confused. “I would enter a room and forget where I was,” she recalled.

For many, the concern is not just their own health but that of loved ones.

Ms. Codina said she was waiting to find out her status so she could decide where to live until she got better: Her roommate had been experiencing Covid-like symptoms. If Ms. Codina’s test came back negative, she planned to move in with either her boyfriend or her parents.

“This impacts many, many people in my life,” she said

And in their shared home in Hackensack, N.J., the Chia brothers were self-quarantining, each in his own bedroom. They wanted to know which members of their family were positive so they could protect their father.

In Chantilly, the machine used to analyze the samples, known as the Roche Cobas 8800, can run 376 tests at once. It takes between three and four hours for the machine to do one cycle. In theory, it can perform 500 tests in under eight hours.

But before anything can happen, a human being needs to do the painstaking work of loading each sample into the machine. As the sun rose on Wednesday morning, a scientist used a pipette to remove liquid from each tube and place it in the testing apparatus.

The machine gave off a purple hue. In the hours that followed, its mechanized arms and levers carried out a process known as the polymerase chain reaction to replicate genetic material. The lab was trying to match the samples against a sequence unique to the new coronavirus, according to Lawrence Tsao, Quest’s East Region medical director.

The process requires high heat and a number of chemical reagents. One of those, an enzyme called Taq polymerase, is sourced from bacteria deep in the ocean’s hydrothermal vents. Because it is in short supply, there is a cap on how many tests Quest can do per day.

“Usually we have extra reagents on hand,” Mr. Tsao said. “Now they calculate what we’re doing, and they give us just that.”

The last step is delivering the results. Twelve times a day, Quest sends batches of results to Maximus, a federal contractor. Because of privacy concerns, the Reston, Va.-based company’s call center does not leave voice messages. Its operators call back only twice before moving to the next patient.

By the time they called Ms. Holmes-Perez, three days had passed since she spent all night waiting in line. By then, the congestion was so bad she had a hard time hearing the operator.

“Negative,” the caller told her.

“At first, I felt relief, but then I started to worry about what is actually going on with me,” Ms. Holmes-Perez said.

In North Bergen, Ms. Codina feared she might not hear the call, so she bought herself a new ringtone: a Ricky Martin song. On Friday, her phone started blasting “Livin’ La Vida Loca” just as she had started to make herself a sandwich. She left the door to the refrigerator open in her haste to answer. Like a little over half the people who have been tested in the state, she, too, was told she was negative.

But when the operator called Israel Chia in Hackensack on Friday, it was with bad news: Both he and his elderly father were positive.

Over the weekend, the situation got worse. The oxygen monitor he had bought put his father in the range of 85 to 90 percent. Doctors are concerned if a patient’s reading falls below 95. On Saturday, he called 911.

Paramedics confirmed the low oxygen level but had a warning for the son: Once your father goes to the hospital, you won’t be able to see him. And he will be surrounded by extremely sick people, who may have a worse strain of the virus.

The test had brought one level of clarity, but now the brothers were facing another dilemma. “Here at home, I can give him his vitamins, his Pedialyte, his protein shake. He’s comfortable,” Mr. Chia said. “Should I keep him home? For now, that’s what we’ve decided to do.”

Real Estate, and Personal Injury Lawyers. Contact us at: https://westlakelegal.com 

90,000 Packages Disappear Daily in N.Y.C. Is Help on the Way?

Westlake Legal Group 00packagetheft1-facebookJumbo 90,000 Packages Disappear Daily in N.Y.C. Is Help on the Way? Shopping and Retail Robberies and Thefts Postal Service and Post Offices Postal Service (US) New York City Fedex Corporation E-Commerce Delivery Services Amazon.com Inc

Online deliveries to an apartment building in northern Manhattan are left with a retired woman in 2H who watches over her neighbors’ packages to make sure nothing gets stolen.

Corporate mailrooms in New York and other cities are overwhelmed by employees shipping personal packages to work for safekeeping, leading companies to ban packages and issue warnings that boxes will be intercepted and returned to the senders.

A new start-up company is gambling that online shoppers who are worried about not getting their packages will be willing to pay extra to ship them to a home-based network of package receivers in Brooklyn.

With online shopping surging and another holiday season unfolding, customers’ mounting frustration and anger over stolen packages are driving many to take creative and even extreme measures to keep items out of the hands of thieves.

In New York City, where more orders are delivered than anywhere else in the country, over 90,000 packages a day are stolen or disappear without explanation, up roughly 20 percent from four years ago, according to an analysis conducted for The New York Times.

About 15 percent of all deliveries in urban areas fail to reach customers because of package theft and other less frequent issues, like deliveries to the wrong house, according to transportation experts.

In suburbs and rural areas, thieves often follow delivery trucks and snatch just-delivered packages from homes, often out of sight of neighbors.

Now online shoppers are turning to a variety of strategies to stymie thieves. Some are installing video doorbell cameras or, at the urging of postal workers, replacing outdated mailboxes from a bygone era of postcards and letters with models that can accommodate large packages.

Online retailers and shipping services, recognizing the scope of the problem, are trying to help customers. Amazon has launched a real-time tracking service so shoppers can arrange to be home when a delivery arrives. UPS is working with a technology company to enable drivers to deposit orders for apartment buildings in locked package rooms.

Amazon, UPS and FedEx also offer an expanding network of secure delivery sites for packages when no one is home. Amazon has over 100 “Hub Lockers” in Manhattan alone. Today, a growing number of bodegas, supermarkets, convenience stores, drugstores and florists are acting as makeshift package holding centers.

Package theft has become so rampant in an apartment building in Brooklyn Heights that one resident, Julie Hoffer, says she now avoids shipping anything to her home that cannot fit in a mailbox.

She sends large boxes to a nearby UPS store, or to a relative in Manhattan. “It’s an issue every time I have to order anything,” Ms. Hoffer, said. “Do they offer tracking? Is it too big for a mailbox? Do I have it diverted?”

“I can’t have my medications delivered here or anything that is essential,’’ she said. “I don’t know what the solution is, but I do know that it’s getting worse.”

Around the country, more than 1.7 million packages are stolen or go missing every day — adding up to more than $25 million in lost goods and services, according to an analysis for The Times by José Holguín-Veras, an engineering professor and director of the Rensselaer Polytechnic Institute Center of Excellence for Sustainable Urban Freight Systems.

In a new survey by insuranceQuotes.com, an online insurance service, nearly 1 in 5 respondents nationally reported having had a package stolen.

“The internet economy has brought tremendous efficiencies but it has also created unintended consequences,” Professor Holguín-Veras said. “Human history shows that new technology solves some problems, but in doing so, it creates others.”

Yet the extent of package theft has been largely underestimated because most cases are not reported to the police. Customers have little incentive to do so when online retailers typically refund or replace items for free, often with few questions.

Most police departments do not track package thefts, but those that have examined the problem have reported notable increases.

The Denver Police Department started compiling data on package thefts in 2015, and has seen a 68 percent increase in reported cases, to 708 last year, from 421 four years ago.

In Washington D.C., 1,846 cases of package theft were reported as of mid-November, already exceeding last year’s total of 1,546 cases, according to police records.

In New York, the police do not break out stolen packages into a separate category. Instead, these cases generally fall under grand larceny if an item is valued at more than $1,000, or petit larceny if valued at less.

Even so, package theft has become a concern in some police precincts. The 77th Precinct in Brooklyn recently posted a reminder on Twitter: “Don’t let your purchase become a steal for someone else.”

Package horror stories have become so common that some state lawmakers are taking aim at thieves. In Texas, package thieves could face up to 10 years in prison under a new law. A South Carolina bill, called the Defense Against Porch Pirates Act, would make package theft a felony.

Amazon, the world’s largest e-commerce company, did not respond to repeated questions about how often its packages are stolen, saying only that the “vast majority of deliveries” arrive without an issue.

UPS and FedEx also declined to share numbers about pilfered packages.

FedEx and UPS offer delivery options that allow customers to leave instructions where to leave packages and UPS drivers have been trained to leave parcels in inconspicuous locations like behind bushes.

Concerns about package theft have helped push video doorbell camera sales to about 1.2 million cameras nationally this year from less than 100,000 cameras sold in 2014, according to Jack Narcotta, a senior analyst for Strategy Analytics.

“It’s a sense of, ‘I’m going to protect what’s mine — even if I have to get my camera,’” Jason Hargraves, managing editor of insuranceQuotes.com, said of the concerns about package theft.

Still, many New Yorkers have little, if any, package security. Parcels are routinely left outside brownstones and houses in crowded neighborhoods with heavy foot traffic.

In apartment buildings without doormen, residents — and anyone else passing through — can pick through boxes piled in lobbies or hallways in a kind of honor system.

Mercedes Alonte, 26, a wardrobe stylist who gets shipments of clothing for work, had packages disappear last fall from her Brooklyn building, which she has since moved out of. “It made me really on edge,” she said. “I can’t do my job if I can’t trust the packages are going to be there when I get home.”

Shane Reidy, 30, an architectural designer, used to ship packages to his Manhattan office. But he grew tired of carrying his orders — one was a 30-pound exercise bar — home on the subway, so now he takes his chances at his building in Queens.

Some companies that have become inundated with personal packages are telling their employees to find other options. JPMorgan Chase has asked its workers not to have shipments sent to the office, while Warner Media warns that packages will be returned to the sender.

Assuaging the anxiety of online shoppers has provided a new source of income for some businesses.

One mailbox store, the Brooklyn Postal Center, receives about 100 packages a day for residents who pay $5 for each delivery. “People used to come in for mailboxes,” said Suhaib Ali, the owner. “Over time, more and more people were signing up for mailboxes but didn’t actually want them for mail. They just wanted to receive their packages.”

Gabriel Cepeda, 23, came up with the idea for a start-up company built around collecting packages, called Pickups Technologies, after his own Amazon order of computer hard drives was stolen last year outside of his parents’ home in New Jersey. He spent hours on the phone trying to get his order replaced. “It was bad enough to motivate me to brainstorm,” he said.

Now Mr. Cepeda’s company connects online shoppers with a network of about 30 residents in the Brooklyn neighborhood of Williamsburg who will accept packages at their homes at all hours, for fees ranging from $4.99 for a single delivery, to $9.99 for a monthly service. The company plans to expand to more neighborhoods.

In East Harlem, Miriam Cruz, a retired nurse’s aide, is almost always home so a couple of neighbors asked her to keep their packages for safekeeping. Soon, word spread around the building, and over the past five years she has opened her door to thousands of packages.

Nothing has been stolen on her watch — unlike the box of Nike sneakers that disappeared recently from outside another apartment. “Put Nikes in front of anyone’s door, of course they’re going to take it,” she said.

Ms. Cruz, 69, said her family did not want her to do it at first because of worries about strangers showing up at her door. She did it anyway. Now, during the holidays, she has boxes filling her hallway and spilling into her bedroom. If neighbors do not pick them up, she posts reminder notes on their doors.

Ms. Cruz, who is known as “Ma” to her neighbors, refuses to take money so they have thanked her with cake and chocolates.

“This is something I do,’’ she said, “because I love my neighbors and I want to pay it forward.’’

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Prime Mover: How Amazon Wove Itself Into the Life of an American City

Credit

For most people, it’s the click that brings a package to their door. But a look at Baltimore shows how Amazon may now reach into Americans’ daily existence in more ways than any corporation in history.

Westlake Legal Group author-scott-shane-thumbLarge Prime Mover: How Amazon Wove Itself Into the Life of an American City Whole Foods Market Inc Television Supermarkets and Grocery Stores Shopping and Retail Robots and Robotics Ring Inc National Security Agency Moving and Moving Industry Movies Lennar Corporation Kohl's Corporation johns hopkins university Haven Health Care Goodreads Inc Fedex Corporation ExpressJet Airlines Inc E-Commerce Delivery Services Computers and the Internet Cloud Computing Book Trade and Publishing Bezos, Jeffrey P Baltimore-Washington International Thurgood Marshall Airport (Md) Baltimore Ravens Baltimore Orioles Baltimore (Md) Audible.com Amazon.com Inc Amazon Mechanical Turk ABX Air Incorporated

Nov. 30, 2019


BALTIMORE — Another big Prime Air 767 takes off from Baltimore-Washington International Airport — where Amazon’s shipping last year eclipsed that of FedEx and U.P.S. put together — and wheels above the old industrial city. Below, the online giant seems to touch every niche of the economy, its ubiquity and range breathtaking.

To the east stand two mammoth Amazon warehouses, built with heavy government subsidies, operating on the sites of shuttered General Motors and Bethlehem Steel plants. Computers monitor workers during grueling 10-hour shifts, identifying slow performers for firing. Those on the floor earn $15.40 to $18 an hour, less than half of what their unionized predecessors made. But in Baltimore’s postindustrial economy, the jobs are in demand.

To the south, near the harbor, are the side-by-side stadiums of the Ravens and the Orioles, where every move on the field is streamed to Amazon Web Services for analysis using artificial intelligence. Football players have a chip in each shoulder pad and baseball players are tracked by radar, producing flashy graphics for television and arcane stats for coaches.

Up in northwest Baltimore, a pastor has found funding to install Amazon Ring video cameras on homes in a high-crime neighborhood. Privacy advocates express alarm at proliferating surveillance; footage of suspects can be shared with the police at a click. But the number of interested residents has already outstripped the number of cameras available.

In City Hall downtown and at Johns Hopkins University a few miles away, procurement officers have begun buying from local suppliers via Amazon Business — and even starred in a national marketing video for the company. Buyers say the convenience more than justifies interposing a Seattle-based corporation between their institutions and nearby businesses. Critics denounce the retail giant’s incursion into long-established relationships. It is a very Amazon dispute.

As federal regulators and Congress assess whether Amazon’s market power should be curbed under antitrust laws — and whether, as some politicians argue, the company should be broken up — The New York Times has explored the company’s impact in one American community: greater Baltimore.

Baltimore’s pleading pitch last year to become an additional headquarters city for Amazon, promising a whopping $3.8 billion in subsidies, did not even make the second round of bidding. But Amazon’s presence here shows how the many-armed titan may now reach into Americans’ daily lives in more ways than any corporation in history. If antitrust investigators want to sample Amazon’s impact on the ground, they could well take a look here.

Anirban Basu, a Baltimore economist who has studied the region for years, is skeptical of apocalyptic claims about Amazon, saying Sears and Walmart were both once seen as all-powerful. But he called Amazon a “profit-margin killer” and said it should be scrutinized, particularly because technological trends that include artificial intelligence, driverless trucks, drones and new payment systems all play to its advantage.

“All these things are a threat to other industries,” Mr. Basu said. “But they’re all good for Amazon. As powerful as it is, Amazon is set to be much more powerful.”

ImageWestlake Legal Group merlin_163632588_d5942e8b-3ab5-498a-bb0a-b0fe87bd3426-articleLarge Prime Mover: How Amazon Wove Itself Into the Life of an American City Whole Foods Market Inc Television Supermarkets and Grocery Stores Shopping and Retail Robots and Robotics Ring Inc National Security Agency Moving and Moving Industry Movies Lennar Corporation Kohl's Corporation johns hopkins university Haven Health Care Goodreads Inc Fedex Corporation ExpressJet Airlines Inc E-Commerce Delivery Services Computers and the Internet Cloud Computing Book Trade and Publishing Bezos, Jeffrey P Baltimore-Washington International Thurgood Marshall Airport (Md) Baltimore Ravens Baltimore Orioles Baltimore (Md) Audible.com Amazon.com Inc Amazon Mechanical Turk ABX Air Incorporated

The BWI2 fulfillment center, one of two major Amazon warehouses in Baltimore, is on the site of a former General Motors plant.Credit…Gabriella Demczuk for The New York Times

Ken Knight has felt Amazon’s long reach. He plans to close his 152-year-old Baltimore houseware and hardware store, Stebbins Anderson, at the end of the year. He pins most of the blame on Amazon.

“It’s put me out of business,” said Mr. Knight, 70, who had hoped to pass the business to his son. Mr. Knight is especially aggrieved by government subsidies to the company in the name of job creation; he will be laying off 40 employees.

Amazon insists, in an argument it is likely to use in antitrust proceedings, that its market power is nothing like what people imagine. Yes, it accounts for 40 to 50 percent of online retail in the United States — but that is only four to five percent of total retail. (Walmart’s revenue is still twice that of Amazon, though Amazon’s total value on the stock market is the fourth largest among American companies, more than double Walmart’s.) And while Amazon may sell nearly half of cloud-computing services, it points out that the cloud makes up a small fraction of information technology spending.

“We welcome the scrutiny,” said Jay Carney, Amazon’s top Washington representative and a former White House press secretary for President Barack Obama. “We operate in huge competitive arenas in which there are thousands and thousands, if not millions, of competitors. It’s hard to argue that if you’re four percent of retail you’re not in competition.”

Baltimore offers in microcosm the contentious issues that Amazon’s conduct has raised nationally: The erosion of brick-and-mortar retail. Modestly paid warehouse work and the looming job destroyer of automation. An aggressive foray into government and institutional procurement, driving local suppliers to partner with Amazon or face decline. A swift expansion in air cargo, challenging FedEx and U.P.S. The neighborhood spread of video and audio surveillance. And the steady conquest of the computing infrastructure that underlies commerce, government and communications, something like an electric utility — except without the regulation imposed on utilities.

Amy Webb, founder of the Future Today Institute, a strategy firm, who lives part time in Baltimore, said Amazon’s impact only began with its retail platform.

“It’s the invisible infrastructure that powers our everyday lives,” said Ms. Webb, who examines Amazon in her book on the tech giants, “The Big Nine.” “Most of us don’t know 95 percent of what Amazon is doing.”

She called the contest for Amazon’s second headquarters a “ridiculous parade, a beauty contest” in which communities nationwide offered up inducements while failing to make a cleareyed assessment of costs and benefits. With its capabilities, market sway and long-term strategy, she said, Amazon now conducts itself like a “nation-state.”

None of this was imaginable in 1994, when Jeff Bezos paged through a dictionary in search of a name for an online bookseller and stopped at “Amazon.” Not only was it the largest river in the world by volume — it was four times bigger than the runner-up, which appealed to Mr. Bezos’ outsize ambitions. Books were just the start.

Some 25 years later, fueled by customers’ addiction to click-and-done convenience and speedy delivery, Amazon has quietly flowed into many areas of life, bringing to more and more arenas its tireless innovation, relentless focus on data, unforgiving employment practices and omnivorous competition. In many homes here, as across the country, it is the ultimate labor-saving device: supplier of electronics, clothes, groceries, books, movies, music, information and security. More than half of American households now have an Amazon Prime membership, and most shopping searches begin on Amazon, not Google. Globally, Amazon, whose critics call it the “apex predator” of digital business, delivered 10 billion packages last year — more than the number of people on the planet.

Greater Baltimore accounts for one percent of Amazon’s sales nationwide — just about its share of the population, according to data prepared for The New York Times by Rakuten Intelligence, which tracks e-commerce.

But as a transportation hub, with Interstate 95 and major rail lines converging near a busy port and airport, Baltimore punches above its weight — originating 2.38 percent of Amazon’s shipments in the United States, Rakuten said.

Even with all that shipping and logistics, Amazon ranks just 14th among local employers, according to The Baltimore Business Journal. Yet like an online shopper who realizes one day that half his possessions came from Amazon, a Baltimorean who looks for the company’s footprints can find them everywhere.

Westlake Legal Group merlin_163632285_aed5919e-6d73-42a1-ad4e-9b27a262c609-jumbo Prime Mover: How Amazon Wove Itself Into the Life of an American City Whole Foods Market Inc Television Supermarkets and Grocery Stores Shopping and Retail Robots and Robotics Ring Inc National Security Agency Moving and Moving Industry Movies Lennar Corporation Kohl's Corporation johns hopkins university Haven Health Care Goodreads Inc Fedex Corporation ExpressJet Airlines Inc E-Commerce Delivery Services Computers and the Internet Cloud Computing Book Trade and Publishing Bezos, Jeffrey P Baltimore-Washington International Thurgood Marshall Airport (Md) Baltimore Ravens Baltimore Orioles Baltimore (Md) Audible.com Amazon.com Inc Amazon Mechanical Turk ABX Air Incorporated  Credit…Gabriella Demczuk for The New York Times

“Amazon is a jungle. It’s the Wild West. But I’m happy to deal with these problems in order to have the sales I have.”

Todd Blatt, Amazon Marketplace vendor

On a midtown back alley, Todd Blatt, one of 18,000 Maryland sellers on Amazon Marketplace, uses a laser printer to turn out little models of the iconic bus-stop benches that read “Baltimore: The Greatest City in America,” peddling them online with an assortment of toys and bric-a-brac. He’s battled counterfeits from competing sellers on Amazon but isn’t really complaining: “I haven’t had a real job since 2012,” he said.

When the Baltimore Behavioral Lab, a research organization, conducts consumer surveys, it posts them on Amazon’s Mechanical Turk microtask site. Users earn tiny sums of money for participating.

Amazon Smart Home is partnering in one Baltimore suburb with Lennar, the country’s largest homebuilder, to install Amazon Echo devices, which use voice-activated Alexa to control Amazon Ring video cameras outside. In a tough city neighborhood where drug dealers intimidate neighbors, the Rev. Terrye Moore is organizing a subsidized video setup after hearing a radio promotion for Ring by the N.B.A. great Shaquille O’Neal.

Westlake Legal Group merlin_163632522_ed230f94-47a0-4fdb-81e8-bc534803d9c5-jumbo Prime Mover: How Amazon Wove Itself Into the Life of an American City Whole Foods Market Inc Television Supermarkets and Grocery Stores Shopping and Retail Robots and Robotics Ring Inc National Security Agency Moving and Moving Industry Movies Lennar Corporation Kohl's Corporation johns hopkins university Haven Health Care Goodreads Inc Fedex Corporation ExpressJet Airlines Inc E-Commerce Delivery Services Computers and the Internet Cloud Computing Book Trade and Publishing Bezos, Jeffrey P Baltimore-Washington International Thurgood Marshall Airport (Md) Baltimore Ravens Baltimore Orioles Baltimore (Md) Audible.com Amazon.com Inc Amazon Mechanical Turk ABX Air Incorporated  Credit…Gabriella Demczuk for The New York Times

“Why can’t we use technology to be the virtual eyes of the citizens and not have to worry about retaliation?”

The Rev. Terrye Moore

Public libraries are stocked with digital audiobooks from Amazon’s Audible, and browsers can check reviews on Amazon’s Goodreads. Down the road in Annapolis, Amazon Studios filmed scenes in the Jack Ryan television series.

Amazon owns two Whole Foods grocery stores in Baltimore and is opening a third, and recently began free delivery to Prime members without a fee. In a dozen convenience stores, it operates Amazon Lockers, where customers can pick up purchases. It has enlisted Kohl’s stores to handle returns. Its trucks and vans are everywhere.

Experts at Baltimore’s academic medical complexes are discussing whether Amazon is preparing to disrupt their industry too. In just the past 18 months, the company joined the health care venture Haven and bought the e-medicine pioneer Health Navigator as well as Pillpack, now part of Amazon Pharmacy.

Through Amazon Web Services, the biggest provider of cloud computing, the company is building the country’s digital backbone. A.W.S. employs a small staff of software engineers in Baltimore — the company declined to say how many — and provides the computing infrastructure for many institutions, from Johns Hopkins to the investment firm T. Rowe Price and the sportswear company Under Armour. Even the secretive National Security Agency, south of Baltimore at Fort Meade, acknowledged that it relied on A.W.S. “for various administrative and mission needs.”

The arms of Amazon sometimes cross in unexpected ways. Though Under Armour uses A.W.S., the clothier has had to balance its own online sales with its Amazon.com “storefront.” The Maryland Department of Human Services downtown partners with A.W.S. in a cloud-computing effort called MD THINK, designed to streamline social services. At the same time, the department said, it provides food stamps to nearly 600 local Amazon employees, largely part-time warehouse workers.

Even as its omnipresence draws antitrust scrutiny, Amazon seems unlikely to pull back. In June, Mr. Bezos, by most accounts the world’s richest person, trumpeted a new Amazon plan to launch 3,200 satellites to provide internet service around the world. He argued that Amazon’s size meant it should take on huge, new challenges.

“Amazon is a large enough company now that we need to be doing things that, if they work, can actually move the needle,” Mr. Bezos said.

Mr. Bezos, who is renovating a $23 million house in Washington, an hour south of Baltimore, has long pushed the mantra of “customer obsession,” and it has paid off. In the Harris Poll on the popularity of major American companies, Amazon has ranked No. 1 or 2 each year since 2012. By comparison, Google fell to 41 this year, and Facebook to 94.

But putting customers’ convenience first, a key to Amazon’s spectacular growth, can put a big squeeze on everyone in the company’s long supply chains — warehouse workers, independent sellers, delivery drivers, cargo pilots — not to mention smaller competitors.

Shaquetta Taylor, who goes by Shaq, scanned an item — a bag of glazed pecans. Her screen directed her to “Stow Item,” and the digital clock started counting — 1, 2, 3, 4, 5, 6, 7 — as she found space for it in the robotic pod. Then there were cactus-shaped tea lights — 17, 18, 19, 20 — and a children’s crafting kit and a magnetic door screen (“Actually, I have this myself,” she remarked).

Ms. Taylor, 43, in glasses and a “Toy Story” T-shirt, mother of two sons and grandmother of a 3-year-old, arrived four years ago at Amazon’s warehouse awed by the company’s cachet. “When I first came here, I thought, ‘I’m not good enough for Amazon,’” she said, taking a brief break from Stow Station 3301.

But after a year, she was asked to become an “ambassador,” helping out newer colleagues at this Amazon Fulfillment Center, shorthand name BWI2, built where G.M.’s Baltimore Assembly Plant operated for seven decades. Its scale is mammoth: 27 acres of floor space, 2,500 employees, 14 miles of speeding conveyor belts.

Westlake Legal Group merlin_163632624_a1279518-28eb-47bd-911c-db396904055d-jumbo Prime Mover: How Amazon Wove Itself Into the Life of an American City Whole Foods Market Inc Television Supermarkets and Grocery Stores Shopping and Retail Robots and Robotics Ring Inc National Security Agency Moving and Moving Industry Movies Lennar Corporation Kohl's Corporation johns hopkins university Haven Health Care Goodreads Inc Fedex Corporation ExpressJet Airlines Inc E-Commerce Delivery Services Computers and the Internet Cloud Computing Book Trade and Publishing Bezos, Jeffrey P Baltimore-Washington International Thurgood Marshall Airport (Md) Baltimore Ravens Baltimore Orioles Baltimore (Md) Audible.com Amazon.com Inc Amazon Mechanical Turk ABX Air Incorporated  Credit…Gabriella Demczuk for The New York Times

“When I first came here, I thought, ‘I’m not good enough for Amazon.’ I became an ambassador about a year ago.”

Shaquetta Taylor, stower at BWI2

If Ms. Taylor doesn’t make her numbers, she can be fired. She’s thrived because she’s fast and accurate, over a demanding 10-hour shift with two half-hour breaks, one of them paid.

The warehouse is run by Preet Virdi, general manager, an Amazon true believer who moved from India to attend Georgia Tech 13 years ago. Mr. Virdi, 35, said his top priority was safety — a whiteboard recently listed 40 head injuries and 109 foot injuries so far in 2019 — and added that his next priority was “how we make the workplace more fun.”

The real boss is data, however, as it is everywhere in Amazonland. Everything that happens is timed and measured in a way that efficiency experts of earlier generations could only dream about. If the computers say Ms. Taylor or other “associates” are too slow or sloppy, they’re out. And if Mr. Virdi doesn’t make his numbers, he’ll be out too.

That is nothing new in industrial practice. But Amazon, with an unparalleled mastery of digital tools and the coolly calculating tone set by Mr. Bezos, has brought it to a rare extreme. The company’s astonishing success has made it, in turn, a powerful influence on other companies.

Some workers thrive despite the pace. “The day goes by quick,” said Robert Taylor, 51, a leader in the warehouse chapter of Glamazon, for L.G.B.T. employees. “All these other people go to the gym. Amazon pays me to stay in shape.”

Some see a path to advancement. Samaira Johnson, 26, a high-school graduate with a pet iguana at home, is already a leader among the employees trained to work with the warehouse robots. Asked where she saw herself in 10 years, she replied, “Running an Amazon building like this one.”

Others falter. Sharon Black, 70, a veteran Baltimore activist who has held assembly-line jobs at G.M. and other plants, worked for a few months at BWI2 last year and found a striking difference: At Amazon, the computers ruled.

That wasn’t entirely negative, she said. In the application process, Amazon didn’t care about age, gender or race — only that a person could walk several miles a day and lift 50 pounds. “They’re an equal opportunity exploiter, I’ll tell you that,” Ms. Black said. “You could come in with three arms and they wouldn’t care.”

Ms. Black said she quit after two written warnings that she wasn’t meeting productivity standards, knowing a third would get her fired.

“The machines determine so much,” she said. “You’re clocked from beginning to end. They grind through people.”

When another employee told the National Labor Relations Board that he had been fired for complaining about working conditions, the company said he had it wrong: He had been fired for working too slowly.

In fact, an Amazon lawyer wrote to the N.L.R.B. last year, it had fired “hundreds of other employees” at the Baltimore warehouse for failing to make their numbers. The letter, obtained by The Verge, listed more than 800 workers fired in the previous year, but the company now says the correct number was 309.

Automated dismissals are a feature, the letter said, not a flaw. “Amazon’s system,” the lawyers wrote, “automatically generates any warnings or terminations regarding quality or productivity without input from supervisors.” Amazon says termination decisions are ultimately made by managers.

Workers at Amazon who run into that kind of trouble have no unions to represent them — a shift from Baltimore’s past. G.M. employees were represented by the United Automobile Workers. At the second warehouse, on the old Bethlehem Steel site, United Steelworkers held sway. At both plants, the pay was adequate to support a family.

In the G.M. plant’s final years, line workers made an average of $27 an hour, equivalent to more than $35 today. G.M. workers could make $80,000 annually with overtime, according to contemporary news reports, equal to $102,000 in 2019 dollars.

The vehemently anti-union Amazon has raised its lowest hourly pay to $15.40, which is a little over double the federal minimum wage, the company points out. But even a veteran worker at its BWI2 warehouse would have to put in considerable overtime to get to $40,000 a year, less than half of what a G.M. worker could make in the past.

Nor are the job numbers comparable. The G.M. plant employed 8,000 at its peak; Bethlehem Steel employed 30,000. Amazon has a total of 4,500 workers at the two warehouses.

In a statement, the company called its jobs “safe and innovative,” noting that the warehouses were built on “blighted property” that was vacant for years before Amazon “injected life (and jobs)” back into the East Baltimore brownfields.

In a city that has shed most unionized industrial jobs, Amazon gets plenty of applicants. Its hourly pay is $2 or $3 higher than at many comparable employers, and benefits are also more generous: medical, dental and vision coverage and a 401(k) with a 50 percent match. The company will reimburse an employee up to $3,000 a year for further education, or give a worker $10,000 to start a business delivering Amazon goods.

Under the circumstances, government officials here are grateful for Amazon’s presence. The company has gotten $65 million in tax incentives and loans to build the two big warehouses and related smaller facilities, according to the Maryland Department of Commerce.

The company said it had spent about $1 billion on infrastructure in Maryland to date; hired about 7,000 full-time direct employees, nearly all at warehouses; and used contractors who hired another 2,100 people.

But economists say online shopping has also erased thousands of retail jobs, and critics point to other costs, including traffic congestion and environmental effects, so assessing the company’s net impact is difficult. Few of the Amazon jobs in Baltimore are the highly paid tech and management positions appearing in Northern Virginia, which Amazon chose for its 25,000-strong second headquarters, called HQ2. (Amazon chose New York City for a similar hub but withdrew in the face of local opposition.)

Such a boon might have been transformative for Baltimore, a struggling city surrounded by wealthier suburbs. But the city ended up on the company’s long list of also-rans, 230 locales that turned over reams of valuable work force and work site data to Amazon in elaborate applications — and got nothing in return.

In a statement, Amazon said the top criterion for choosing a location was “the availability of tech talent.” It added, “Nowhere did Amazon say HQ2 was a project designed to help communities in need.”

Westlake Legal Group 00baltimore-black-jumbo Prime Mover: How Amazon Wove Itself Into the Life of an American City Whole Foods Market Inc Television Supermarkets and Grocery Stores Shopping and Retail Robots and Robotics Ring Inc National Security Agency Moving and Moving Industry Movies Lennar Corporation Kohl's Corporation johns hopkins university Haven Health Care Goodreads Inc Fedex Corporation ExpressJet Airlines Inc E-Commerce Delivery Services Computers and the Internet Cloud Computing Book Trade and Publishing Bezos, Jeffrey P Baltimore-Washington International Thurgood Marshall Airport (Md) Baltimore Ravens Baltimore Orioles Baltimore (Md) Audible.com Amazon.com Inc Amazon Mechanical Turk ABX Air Incorporated  Credit…Gabriella Demczuk for The New York Times

“This is all by the numbers. There’s no leeway.”

Sharon Black, who left her job as a picker at BWI2

For Ms. Black, the former employee, one experience captured what she thought was the eerily inhuman warehouse culture. In November last year, two contract workers were killed when a tornado collapsed a wall of a smaller Amazon warehouse opposite BWI2.

Ms. Black said she drove to work the next morning, steering around fallen trees, wondering how the company would handle the deaths at the brief standing meeting that began each shift.

“I thought they’d have two minutes of silence,” she said. “Nope. We didn’t pause.” Instead, she said, there was the usual tribute to the “power picker” — the outstanding performer in her unit, as measured by the computers. Michael Jackson music played, she said, and the supervisor shouted, “Let’s have a better day than yesterday!”

It was a reference to production levels, not to the overnight catastrophe.

Rachael Lighty, an Amazon spokeswoman, said the company offered counseling and hosted the most affected employees for a meal. “We are committed to constantly improving how we communicate with and engage with our employees,” she said.

Despite the demanding nature of their jobs, many warehouse workers fear Amazon intends to replace them with robots, a worry shared by some experts and politicians like Andrew Yang, the presidential candidate who warns that automation will create mass unemployment. Amazon has begun testing machines that can pack boxes, and human beings can be prone to injury, easily exhausted, eager to unionize and outspoken about gripes.

The robots that silently cruise through the warehouses, each carrying up to 1,200 pounds of purchases, are none of these things.

But Ms. Webb, the futurist and technology writer, said she believed Amazon had made a different discovery: that the job of moving products from bin to pod and pod to box is presently more cheaply performed by humans than by robots.

“It’s not that the robots are taking over,” Ms. Webb said. “It’s that we’ve been relegated to robot status.”

Asked whether the Baltimore-area might automate further, Ms. Lighty, the Amazon spokeswoman, said there was no such plan.

“We have hundreds of robots here, but thousands of people,” she said. “And it’s the people that make the Amazon magic happen.”

A marketing video released last spring appears designed to capture some of that magic, right in Baltimore. Shots of the city’s harbor and iconic rowhouses alternate with views of the busy Amazon warehouse. “We help Baltimore businesses buy from other Baltimore businesses,” says Mr. Virdi, the warehouse manager, as packages race past on conveyor belts.

More surprising than Mr. Virdi’s remarks are enthusiastic endorsements from City Hall and Johns Hopkins, whose chief purchasing officers laud Amazon in the video for helping them connect with local suppliers.

It is a glimpse of Amazon’s major push into territory it has not yet conquered: purchasing by government and other institutions that relies on competitive bids and fixed-price contracts. At the federal level, Amazon lobbied for legislation — congressional staffers called it “the Amazon amendment” — designed to help it win government sales. At the local level, it has fended off accusations of predatory competition by saying it can actually connect local buyers with local suppliers.

Brian Smith, the Johns Hopkins purchasing officer and a subject of the video, said local businesses often found the big university hard to approach. But he met an Amazon representative at a convention, and now Johns Hopkins has a customized Amazon Business page that gets local vendors “in front of a lot of eyeballs here,” he said. Erin Sher Smyth, Baltimore’s chief procurement officer, noted that Amazon’s website flagged such criteria as minority and female owners and made record-keeping easy.

But like many people who find Amazon both convenient and worrisome, Ms. Smyth admitted to a certain ambivalence about its impact.

“In my role as city purchasing agent, I’m trying to get the best product for the best price, efficiently, and Amazon lets me do that,” she said. “In my personal life, I do worry about Main Street shops.”

Her anxiety is widely shared. As in other cities, many Baltimore shopping districts are anemic and pocked with vacancies. The waterfront Harborplace shopping pavilions, once a symbol of urban revival, are in receivership.

The causes include mismanagement, shifting tastes and big-box competition, but Amazon’s unstoppable growth is a factor. In Baltimore and its suburbs, the average Amazon shopper makes nearly 40 purchases a year, totaling about $1,300 — spending that is up more than 50 percent since 2016, according to Rakuten.

Now, as it moves into institutional procurement, Amazon has sought to persuade civic-minded public officials that it can be a booster. Both the city and the university designated a particular company located about 15 miles southwest of Baltimore, AJ Stationers, as a preferred supplier of office products via Amazon, in part because the firm is owned by a minority woman, Angela Jeung.

That has been a windfall for AJ Stationers, said Rusty Balazs, the sales manager, who estimated that annual sales to Johns Hopkins had climbed from $100,000 to $2 million. But AJ Stationers has shrunk from two stores and about 50 employees two decades ago to a website and a dozen employees today, he said.

Mike Tucker, chief executive of the Baltimore-based independent office product dealers’ association, said AJ was really a “poster boy” whose local deals, highlighted in the marketing video, were a public relations tactic intended to obscure Amazon’s impact on small businesses already battered by Office Depot and Staples. (His association, which had 12,000 member businesses in the 1980s, now has 1,500.)

“That Amazon convenience comes at a big price,” said Mr. Tucker, noting that he welcomed the antitrust inquiries down the road in Washington. The price is paid, he said, not just by local dealers but by their myriad business connections, from cleaning services to gas stations, eroding local employment.

“It doesn’t matter that the local business served you and helped you with your problems for years and years,” he said. “Amazon does whatever it takes to crush the competition.”

Addressing such criticism, Amazon said it offered “best-value pricing for education and public-sector organizations” and helped small businesses thrive “because customers are able to discover suppliers.”

Mr. Tucker said he shared the Amazon marketing video with a local office products executive who had seen his Baltimore sales drop. When the executive realized Amazon had moved into his market, his “head exploded,” Mr. Tucker said.

But the executive declined to speak with The Times, Mr. Tucker said, for fear of angering Amazon. “He’s afraid that they may have to make a deal with the Devil to survive,” Mr. Tucker said.

Anyone who wants a glimpse of Amazon’s expansive appetite might pay a visit to B.W.I. airport, where a new white warehouse seems to stretch on and on. Workers are putting the final touches on a $36 million 200,000-square-foot building, financed with tax-exempt bonds, that will dwarf Amazon’s current airport operations. There are bays for 93 tractor-trailers to load and unload at once.

The growth at what Amazon Air calls its “gateway” — one of 25 around the country — has been rapid. In 2016, Amazon Air, a new division, did not operate through B.W.I. The following year, Amazon moved more freight through the airport than either FedEx or U.P.S., the industry leaders. And in 2018, it loaded and unloaded 9,300 metric tons of goods at B.W.I., more than FedEx and U.P.S. combined, though globally their fleets remain far larger.

Morgan Stanley warned a year ago that “the market is missing the risk Amazon Air poses” to FedEx and U.P.S., knocking down those companies’ stocks. Other analysts are skeptical. But FedEx, worried that its longtime partner was becoming a competitor, announced last summer that it was ending air and ground delivery for Amazon.

Until recently, the company’s B.W.I. expansion here was swathed in secrecy — environmental reports referred only to a “Midfield Cargo Operator,” and Maryland’s governor, Larry Hogan, spoke last year of welcoming to B.W.I. “a very well-known e-commerce giant.” Though its Boeing 767s are often painted with the Prime Air logo, Amazon contracts its flying to several lower-profile operators, including Atlas Air, ABX Air, Air Transport International and Southern Air.

One reason for Amazon’s reticence may be stormy negotiations between its biggest carriers and the Teamster units that represent pilots. Union records show that Atlas Air, the biggest Amazon flyer, pays pilots about a third less than FedEx or U.P.S.

Ed Nirel, a first officer for Atlas, said he had flown into Baltimore “at 3 a.m. and 3 p.m.” and had watched the operation expand, with a half-dozen Amazon Air jets now sometimes jockeying for docking space. He said the pilot pay gap had led to staffing problems; he has worked as many as 17 days in a row for Atlas, he said, compared with a maximum of four days at his last job, with ExpressJet.

“I’d love to stay at Atlas — it’s a great group of pilots,” Mr. Nirel said. “The Amazon airport operations are pretty cool to see. But if FedEx or U.P.S. offers me a job, I’m going to go. My working life would be better, and it would be better for my family.”

Robert Kirchner, who recently retired as an Atlas pilot and now is a union negotiator, said Amazon’s drive for speedy delivery was stretching the work force to the breaking point.

“Atlas’s fatigue complaints are through the roof,” Mr. Kirchner said. “They’re wearing the pilots out, and it’s a completely unsafe situation.” He said the union was closely tracking the still-unexplained crash of an Atlas 767 carrying Amazon cargo into a Texas swamp last February, killing three, to see if fatigue was a factor.

Atlas, responding to questions from The Times, said its pilots got a “competitive total compensation package” and flew an average of 42 hours a month, compared with an industry average of 53. It said it was working with the National Transportation Safety Board to understand what went wrong in the Texas crash.

Drive five minutes from Amazon’s new air cargo hub and you find a humbler scene: a package delivery station, surrounded by Prime tractor-trailers, unmarked white vans used by Amazon contractors and the flex drivers who load their cars with packages for what the industry calls the “last mile.” There are new SUVs, compacts with rooftop carriers and banged-up sedans. The drivers use the Amazon Flex app to sign up for “blocks” — $54 for delivering a certain number of packages between 7 a.m. and 10 a.m. on one recent day, or $72 between 5:15 p.m. and 8:15 p.m.

Amazon just opened a second Baltimore delivery station. Every such station Amazon opens, said Marc Wulfraat, a supply chain consultant, means that about 40,000 packages a day, previously delivered by the United States Postal Service and other carriers, shift to Amazon’s own operation.

One consequence is a steady shift of work from unionized Postal Service jobs to flex drivers, many of them struggling to get by. In August, the Postal Service explained a big third-quarter loss by saying in a filing that “certain major customers” were cutting back on package shipping. In Baltimore over the past two years, the Postal Service share of Amazon deliveries has dropped from about 60 percent to under 30 percent, according to Rakuten. Amazon’s own share of its Baltimore deliveries has risen to 50 percent from 20 percent in 2017.

On a private Facebook group for flex drivers working the Hanover, Md., station near B.W.I., the replacements for postal workers and FedEx truckers trade tips and grumble.

Several said the station was so jammed they had to load packages outside in the rain. Whoever at Amazon designed the 25-mile route to Sykesville, Md., one driver groused, “needs to be drug-tested, like seriously.” Another complained that a 28-package nighttime route listed at two-and-a-half hours took her more than four hours to complete, and “a dog came out on me on top of that because it was too dark to see.”

But the most profitable part of Amazon’s operations has nothing to do with the clamor of warehouses, airports and trucks. All but invisible to the public, Amazon Web Services hums quietly in the background of a huge and growing slice of American life.

Countless Baltimore-area businesses, nonprofits and government programs use A.W.S. When Baltimoreans stream a movie on Netflix instead of Amazon Prime, they are still using Amazon — because Netflix relies on A.W.S.’s cloud computing. (The Times is also an A.W.S. customer.)

Many companies see A.W.S. as the computing equivalent of Baltimore Gas & Electric, the local utility: They plug into the cloud — the generic term for rented, off-site computer space — and pay for what they use. Some fret about what will happen when Amazon’s cloud crashes, as happens periodically with power companies. But A.W.S. has proved quite reliable so far.

Consider T. Rowe Price, the global investment firm headquartered on Baltimore’s Inner Harbor, which has steadily replaced its own information infrastructure with Amazon’s service.

As it adds customers in Asia and Europe, said Nigel Faulkner, chief technology officer at T. Rowe Price, the traditional approach would be to build its own data servers in new markets.

“With Amazon we can rely on their servers in those places,” he said. “That’s cheaper.” T. Rowe Price can increase or decrease its use of A.W.S. services at any time, paying only for what it uses. And there are hundreds of applications built on A.W.S. offering specialized services, from database management to artificial intelligence.

The N.F.L. also uses Amazon’s software tools, crunching data from more than 200 metrics in every football game. Data streams to the A.W.S. cloud from chips embedded not just in players’ shoulder pads but in referees’ jerseys, the football and even the chains used to measure first downs. Machine-learning tasks that used to take all night are completed in 20 minutes using the massive computing capacity of A.W.S.

“What we’ve really done is take a lot of the gut instinct some people have and quantified it,” said Matt Swensson, the football league’s vice president of emerging products and technology.

When the Baltimore Ravens faced the Miami Dolphins, for example, N.F.L. analysts could annotate the video with the time Lamar Jackson took to get a pass off (3.8 seconds), the precise distance of the throw (46.9 yards) and the odds that Marquise Brown would catch it: 32 percent. (For the record, he did catch it — for a touchdown.)

A.W.S., like its cloud competitors, is especially popular with tech start-ups, which can pay as they grow, said Chris Sachse, founder of Think|Stack, a Baltimore company that works closely with A.W.S. and provides cybersecurity and infrastructure consulting.

Mr. Sachse, whose grandfather and father sold trucks for a living and who serves on a state work force development board, said he saw tech jobs as a potential path for Baltimoreans without higher education, because they require expertise but not degrees.

“A college degree doesn’t help you with A.W.S., because it’s all brand-new,” he said. “A lot of people think the death of industry has made it impossible to have middle-class jobs. I think we have a path to those middle-class jobs.”

Mr. Sachse said he has advised Baltimore start-ups gratis, including one working to streamline philanthropy and another selling subscriptions to products like razors. He often asks A.W.S. to provide free training and other services, and they usually step up.

“I’m sure they see the capitalist return on it,” he said. “For them it’s — the more people we train to use A.W.S., the more business we’ll have. If these start-ups hit it big, so does A.W.S.”

Mike Subelsky, a Baltimore tech entrepreneur, once extolled A.W.S.’s virtues at the trendy South by Southwest festival, talking about his email start-up while dressed as “Mr. Spam.” A regular Amazon shopper, he said Amazon had saved him more than once, recalling its speedy delivery of a crucial Spanish-English dictionary for his middle-school daughter.

Yet these days, he’s ambivalent. He worries about Amazon’s invasive data collection, the influence exercised by its algorithms, the heat generated by its enormous computer centers and the exploitation of its workers. “It’s a U.S. company that’s hyperdominant and rich and has incredible market power, and they’re not in it for social good,” he said.

His mixed feelings echo those of many Americans about the emerging dark side of digital life.

“For my generation, the internet was the equivalent of landing on the moon. But the internet seems to have made some things so much worse,” he said. “I’m not sure this is the world I want my kids to be growing up in.”

At Stebbins Anderson, the home products store dating to 1867, a 30-percent-off closing sale is underway. Mr. Knight, the owner, recalls the beginning of his long battle with Amazon nearly 20 years ago, when customers would ask for a six percent discount to match the online retailer, which for many years collected no sales tax.

Amazon started imposing sales tax after building warehouses in Maryland. By then, it was also receiving loans and tax credits from the state, while drawing away more and more of Mr. Knight’s patrons, he said. Even his own daughters, busy at their jobs, found online ordering irresistible.

“It would have been nice to get some of the benefits Amazon gets,” he said. “But the little guy always ends up footing the bill.”

Across town, however, there’s an unexpected development in the area where Amazon got its start: books. It decimated Borders and Barnes & Noble in Baltimore. But that made room for a small, hardy band of independent bookstores, led by the Ivy Bookshop, which opened a second bookstore-cafe called Bird in Hand in 2016.

Westlake Legal Group merlin_163632498_c826238b-ca3e-4a6f-80d8-a210a8aa585d-jumbo Prime Mover: How Amazon Wove Itself Into the Life of an American City Whole Foods Market Inc Television Supermarkets and Grocery Stores Shopping and Retail Robots and Robotics Ring Inc National Security Agency Moving and Moving Industry Movies Lennar Corporation Kohl's Corporation johns hopkins university Haven Health Care Goodreads Inc Fedex Corporation ExpressJet Airlines Inc E-Commerce Delivery Services Computers and the Internet Cloud Computing Book Trade and Publishing Bezos, Jeffrey P Baltimore-Washington International Thurgood Marshall Airport (Md) Baltimore Ravens Baltimore Orioles Baltimore (Md) Audible.com Amazon.com Inc Amazon Mechanical Turk ABX Air Incorporated  Credit…Gabriella Demczuk for The New York Times

“There’s much more of a consciousness of supporting a bookstore and specifically not using Amazon.”

Emma Snyder, owner of the Ivy Bookshop

Like independents making a comeback around the country, the Ivy sells books at full price, making its success all the more striking. Customers will pay $30 for a book they might get with a click for $20 online, in part because they don’t like the world they believe Amazon is building, said Emma Snyder, the shop’s owner.

“There’s much more consciousness of supporting a bookstore and specifically not using Amazon,” Ms. Snyder said. “Part of what people don’t like is that Amazon debases the value of things. We’re commercial spaces, but we fundamentally exist to feed and nurture people’s souls.”

Top video illustration by Dave Horn. Source: Gabriella Demczuk for The New York Times; Baltimore Ravens, via YouTube; and Anne Arundel County Police.

Real Estate, and Personal Injury Lawyers. Contact us at: https://westlakelegal.com 

How FedEx Cut Its Tax Bill to $0

Westlake Legal Group 00DC-FEDEXTAX-01-facebookJumbo How FedEx Cut Its Tax Bill to $0 United States Politics and Government United States Trump, Donald J Taxation Tax Cuts and Jobs Act (2017) Stock Buybacks Smith, Frederick Fedex Corporation Federal Taxes (US) Corporate Taxes

WASHINGTON — In the 2017 fiscal year, FedEx owed more than $1.5 billion in taxes. The next year, it owed nothing. What changed was the Trump administration’s tax cut — for which the company had lobbied hard.

The public face of its lobbying effort, which included a tax proposal of its own, was FedEx’s founder and chief executive, Frederick Smith, who repeatedly took to the airwaves to champion the power of tax cuts. “If you make the United States a better place to invest, there is no question in my mind that we would see a renaissance of capital investment,” he said on an August 2017 radio show hosted by Larry Kudlow, who is now chairman of the National Economic Council.

Four months later, President Trump signed into law the $1.5 trillion tax cut that became his signature legislative achievement. FedEx reaped big savings, bringing its effective tax rate from 34 percent in fiscal year 2017 to less than zero in fiscal year 2018, meaning that, overall, the government technically owed it money. But it did not increase investment in new equipment and other assets in the fiscal year that followed, as Mr. Smith said businesses like his would.

Nearly two years after the tax law passed, the windfall to corporations like FedEx is becoming clear. A New York Times analysis of data compiled by Capital IQ shows no statistically meaningful relationship between the size of the tax cut that companies and industries received and the investments they made. If anything, the companies that received the biggest tax cuts increased their capital investment by less, on average, than companies that got smaller cuts.

FedEx’s financial filings show that the law has so far saved it at least $1.6 billion. Its financial filings show it owed no taxes in the 2018 fiscal year overall. Company officials said FedEx paid $2 billion in total federal income taxes over the past 10 years.

As for capital investments, the company spent less in the 2018 fiscal year than it had projected in December 2017, before the tax law passed. It spent even less in 2019. Much of its savings have gone to reward shareholders: FedEx spent more than $2 billion on stock buybacks and dividend increases in the 2019 fiscal year, up from $1.6 billion in 2018, and more than double the amount the company spent on buybacks and dividends in fiscal year 2017.

A spokesman said it was unfair to judge the effect of the tax cuts on investment by looking at year-to-year changes in the company’s capital spending plans.

“FedEx invested billions in capital items eligible for accelerated depreciation and made large contributions to our employee pension plans,” the company said in a statement. “These factors have temporarily lowered our federal income tax, which was the law’s intention to help grow G.D.P., create jobs and increase wages.”

FedEx’s use of its tax savings is representative of corporate America. Companies have already saved upward of $100 billion more on their taxes than analysts predicted when the law was passed. Companies that make up the S&P 500 index had an average effective tax rate of 18.1 percent in 2018, down from 25.9 percent in 2016, according to an analysis of securities filings. More than 200 of those companies saw their effective tax rates fall by 10 points or more. Nearly three dozen, including FedEx, saw their tax rates fall to zero or reported that tax authorities owed them money.

From the first quarter of 2018, when the law fully took effect, companies have spent nearly three times as much on additional dividends and stock buybacks, which boost a company’s stock price and market value, than on increased investment.

The law cut the corporate rate to 21 percent from 35 percent, and allowed companies to deduct the full cost of new equipment investments in the year that they make them. Those cuts stimulated the American economy in 2018, helping to push economic growth to 2.5 percent for the year and fueling a boost in hiring. Business investment rose at an 8.8 percent rate in the first quarter of 2018, and was nearly as strong in the second quarter.

But the impact dwindled quickly.

In the summer, the economy grew at just 1.9 percent and business investment fell 3 percent, including a 15.3 percent plunge in spending on factories and offices. Over the spring, companies spent less on new investments, after adjusting for inflation, than they had in the winter.

Overall business investment during Mr. Trump’s tenure has now grown more slowly since the tax cuts were passed than before.

Some conservative economists and business leaders say the effects of the tax cuts were undercut by uncertainty from Mr. Trump’s trade war, which is slowing global growth and prompting companies to freeze projects. Other economists say the fizzle is predictable because high tax rates were not holding back investment.

“It did provide a short-term boost, but it wasn’t the big response that many people expected,” said Aparna Mathur, an economist at the conservative American Enterprise Institute, who recently concluded that the 2017 law has not meaningfully changed investment patterns in America.

Mr. Smith, 75, a former Marine who built FedEx from a small package delivery service into a global logistics giant, was no stranger to pressing for lower taxes. He tried, without success, to get President Barack Obama to cut the corporate rate. But with Mr. Trump’s ascension, the corporate chief began a one-man campaign to convince Washington that now was the moment. He met with the president-elect at Trump Tower on Nov. 17, just days after the election, and appeared alongside the president at official events.

In a conference call with analysts the month after Mr. Trump’s election, Alan Graf, FedEx’s chief financial officer, called the prospect of a 20 percent corporate tax rate “a mighty fine Christmas gift.”

Mr. Smith teamed up with his competitor, David Abney, the chairman and chief executive of UPS, to push for a tax overhaul, including jointly writing an op-ed in The Wall Street Journal.

“Fred and I even jointly had some meetings about this with key people, and we were both pushing pretty hard,” Mr. Abney said in a recent interview.

FedEx spent $10 million on lobbying in 2017, in line with previous spending, with much of it focused on tax issues, according to federal records. Its team pushed hard to shape the bill behind the scenes, meeting regularly with House and Senate committee staff who were writing the provisions.

Mr. Smith met with Mr. Trump and Vice President Mike Pence in February 2017, and on May 26 he spoke on the phone with Steven Mnuchin, the Treasury secretary, according to Mr. Mnuchin’s public calendar.

Eight months after Congress passed the law, Mr. Trump celebrated the tax cuts by hosting Mr. Smith and other business leaders at a dinner at his Bedminster, N.J., golf club. He singled out Mr. Smith several times, bantering with him about a term paper that Mr. Smith had written while a student at Yale. The paper formed the basis for the creation of FedEx.

The next week, Mr. Smith boasted of his company’s influence on the law in the company’s annual report, which noted that FedEx is “investing more than $4.2 billion in our people and our network as a result of the tax act.”

FedEx increased the size of its work force by around 4 percent in its 2018 fiscal year and around 7 percent in its 2019 fiscal year.

The company also accelerated previously scheduled wage increases for hourly employees by six months. It gave performance-based pay to other managers and said it would invest $1.5 billion over seven years in its Indianapolis shipping hub. The company also bought 24 Boeing freight jets for $6.6 billion, a purchase officials say would not have happened without tax cuts.

But the company ended its 2018 fiscal year having spent $240 million less on capital investments than it predicted it would in December 2017, shortly before the tax cuts passed. The company’s capital spending declined by nearly $175 million in fiscal 2019.

This year, the company cut back employee bonuses and has offered buyouts in an effort to reduce labor costs in the face of slowing global growth. The company has also added to its pension fund, a move that carried the benefit of reducing its tax liability even further.

FedEx reduced its tax liability in part by taking advantage of a provision in the law that allowed companies to immediately deduct the value of any capital investments they make in a given year. But its biggest gains were from the cut in the corporate rate. FedEx had been carrying a large amount of future tax liabilities on its balance sheet — and when the corporate rate fell to 21 percent, those liabilities shrank too.

“Something like $1.5 billion in future taxes that they had promised to pay, just vanished,” said Matthew Gardner, an analyst at the liberal Institute on Taxation and Economic Policy in Washington. “The obvious question is whether you can draw any line, any connection between the tax breaks they’re getting, ostensibly designed to encourage capital expenditures, and what they’re actually doing. And it’s just impossible to know.”

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China Detains FedEx Pilot Amid Rising U.S.-China Tensions

Westlake Legal Group 20fedex-1-facebookJumbo China Detains FedEx Pilot Amid Rising U.S.-China Tensions Pilots International Trade and World Market firearms Fedex Corporation China Blacklisting Airlines and Airplanes

SHANGHAI — Authorities in southern China have detained an American pilot who works for FedEx, in the latest in a series of difficulties for American travelers and companies in China.

The pilot had been waiting to catch a commercial flight out of the city of Guangzhou, where FedEx has a huge hub. In a statement, FedEx said authorities had found an object in his luggage, though it did not specify what the object was.

The pilot was released on bail, FedEx said. “We are working with the appropriate authorities to gain a better understanding of the facts,” it said in a statement and declined to comment further.

The Wall Street Journal, which reported the detention on Thursday, said that the pilot had been carrying nonmetallic pellets used in air guns, and that he was a United States Air Force veteran named Todd A. Hohn who had been trying to catch a flight to his home in nearby Hong Kong.

The Air Line Pilots Association International, the union representing most American pilots, declined to discuss the case, as did Mr. Hohn’s lawyer. The municipal foreign affairs office in Guangzhou declined to comment and referred questions to the police, who did not answer telephone calls.

FedEx is one of a number of companies that have been caught between Washington and Beijing as the trade war has intensified. But it is not clear whether the pilot’s detention was related to the company’s problems in China.

As trade frictions and other disputes fester between the United States and China and as China itself becomes more authoritarian, more Americans have found themselves stuck in China and unable to leave. A Koch Industries executive was held in southern China and interrogated for days in June before being allowed to exit the country.

The State Department issued a travel advisory for China in January, warning Americans, particularly those with dual Chinese-American citizenship, that they may not be allowed to leave China if they go there.

A growing number of foreign companies, particularly American companies but also Canadian and European businesses, have responded by scrutinizing but not prohibiting travel to China by executives and employees.

But the quick release of the pilot, although without allowing him to leave the country, may indicate that China is not eager to turn him into a bilateral issue, said James Zimmerman, a partner in the Beijing office of Perkins Coie, a global law firm.

“The fact that he was released is a critically important message and a positive sign — Beijing probably ordered his release to minimize the significance of the issue, and this is an indication that Beijing doesn’t want this case to be a huge distraction.” Mr. Zimmerman said.

Mr. Zimmerman said that China does not have a bail system as it is generally understood in the West. China relies more on severe travel restrictions on people who are released from detention but remain under investigation.

The detention comes as the United States and China are trying to reach at least a partial truce in their 15-month trade war. Chinese officials have been eager to head off further tariffs that President Trump has planned to impose on Oct. 15 and Dec. 15, but are also loath to agree to the broad Chinese policy changes sought by the Trump administration.

It was unclear on Friday if Chinese authorities had deliberately targeted the pilot because he worked for FedEx. The detention came as Chinese airports have visibly increased security measures in recent months. The authorities have paid particular attention to travelers going to or from Hong Kong, a semiautonomous Chinese territory where large and increasingly violent protests have taken place every weekend this summer.

China has strict laws not just against the possession of weapons but also against the possession of any kind of ammunition.

FedEx has had a series of difficulties in China in recent months. China has accused FedEx of delaying shipments last May by Huawei, the Chinese telecommunications giant accused by American officials of working with Chinese intelligence — accusations that Huawei denies.

FedEx has also been working with Chinese authorities to investigate how one of its American clients was allowed to send a gun to a sporting goods store in southeastern China. The gun was also detected and stopped by Chinese authorities.

Chinese nationalists have called in recent weeks for FedEx to be included on a list of “unreliable entities” that the country’s Commerce Ministry has been drafting. The drafting has begun in response to the United States Commerce Department’s decision to begin putting Huawei on an “entities list” of foreign companies to which goods can only be exported from the United States with special licenses.

Cathay Pacific, a large airline based in Hong Kong, has separately come under heavy scrutiny by the Chinese government after some of its employees expressed support for pro-democracy protesters in Hong Kong. China threatened to revoke the airline’s access to its airspace unless Cathay reined in its employees.

Cathay Pacific and FedEx are two of the largest airlines hauling Chinese exports to the United States. Much of China’s electronics exports, particularly higher-value items like iPhones, travel by air.

In addition to scrutinizing travelers to and from Hong Kong very closely, the Chinese government has also begun checking foreigners visiting or living in the country for any possession or recent use of drugs, sometimes even weeks or months before the foreigners came to China. That has also produced a series of detentions.

Travel experts now strongly advise anyone going to China to carry prescription medicines in their original containers, and not to carry any prescription medicines that may be illegal in China, like prescription cannabis.

FedEx is a well-known company in China as well as in the United States. By coincidence, HBO showed in China on Thursday night the Tom Hanks movie “Cast Away,” the fictional story of a FedEx manager marooned on a Pacific island for years.

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U.S. Tech Companies Sidestep a Trump Ban, to Keep Selling to Huawei

SHANGHAI — A number of the United States’ biggest chip makers have sold millions of dollars of products to Huawei despite a Trump administration ban on the sale of American technology to the Chinese telecommunications giant, according to four people with knowledge of the sales.

Since the Commerce Department enacted the ban in May, American companies including Intel and Micron have found ways to sell technology to Huawei, said the people, who spoke on the condition they not be named because they were not authorized to disclose the sales.

The components began to flow to Huawei about three weeks ago, the people said. Goods produced by American companies overseas are not always considered American-made, and the suppliers are taking advantage of this. The sales will help Huawei continue to sell products such as smartphones and servers.

The deals underscore how difficult it is for the Trump administration to clamp down on companies that it considers a national security threat, like Huawei. They also hint at the possible unintended consequences from altering the web of trade relationships that ties together the world’s electronics industry and global commerce.

ImageWestlake Legal Group merlin_149714850_de19f104-878f-40b3-ba6d-28b0db38a918-articleLarge U.S. Tech Companies Sidestep a Trump Ban, to Keep Selling to Huawei United States Politics and Government Trump, Donald J Micron International Trade and World Market Intel Corporation Huawei Technologies Co Ltd Fedex Corporation Corporations Computer Chips Commerce Department China

American companies like Intel may sell technology supporting current Huawei products until mid-August.CreditAly Song/Reuters

The Commerce Department’s move to block sales to Huawei, by putting it on a so-called entity list, set off confusion within the Chinese company and its many American suppliers, the people said. Many executives lacked deep experience with American trade controls, leading to initial suspensions in shipments to Huawei until lawyers could puzzle out which products could be sent. Decisions about what can and cannot be shipped were also often run by the Commerce Department.

American companies may sell technology supporting current Huawei products until mid-August. But a ban on components for future Huawei products is already in place. It’s not clear what percentage of the current sales were for future products. The sales have most likely already totaled hundreds of millions of dollars, the people estimated.

While the Trump administration has been aware of the sales, officials are split about how to respond, the people said. Some officials feel that the sales violate the spirit of the law and undermine government efforts to pressure Huawei, while others are more supportive because it lightens the blow of the ban for American corporations. Huawei has said it buys around $11 billion in technology from United States companies each year.

Intel and Micron declined to comment.

“As we have discussed with the U.S. government, it is now clear some items may be supplied to Huawei consistent with the entity list and applicable regulations,” John Neuffer, the president of the Semiconductor Industry Association, wrote in a statement on Friday.

“Each company is impacted differently based on their specific products and supply chains, and each company must evaluate how best to conduct its business and remain in compliance.”

The Idaho-based Micron competes with South Korean companies like Samsung to supply memory chips that go into Huawei’s smartphones.CreditKai Pfaffenbach/Reuters

In an earnings call Tuesday afternoon, Micron’s chief executive, Sanjay Mehrotra, said the company stopped shipments to Huawei after the Commerce Department’s action last month. But it resumed sales about two weeks ago after Micron reviewed the entity list rules and “determined that we could lawfully resume” shipping a subset of products, Mr. Mehrotra said. “However, there is considerable ongoing uncertainty around the Huawei situation,” he added.

A spokesman for the Commerce Department, in response to questions about the sales to Huawei, referred to a section of the official notice about the company being added to the entity list, including that the purpose was to “prevent activities contrary to the national security or foreign policy interests of the United States.”

The fate of Huawei, a crown jewel of Chinese innovation and technological prowess, has become a symbol of the economic and security standoff between the United States and China. The Trump administration has warned that Chinese companies like Huawei, which makes telecom networking equipment, could intercept or secretly divert information to China. Huawei has denied those charges.

President Xi Jinping of China and President Trump are expected to have an “extended” talk this week during the Group of 20 meetings in Japan, a sign that the two countries are again seeking a compromise after trade discussions broke down in May. After the talks stalled, the Trump administration announced new restrictions on Chinese technology companies.

While the Trump administration has pointed to security and legal concerns to justify its actions, some analysts have worried that Huawei and other Chinese tech companies were becoming pawns in the trade negotiations. Along with Huawei, the administration blocked a Chinese supercomputer maker from buying American tech, and it is considering adding the surveillance technology company Hikvision to the list.

The SK Hynix plant in Icheon, South Korea. American companies are worried about losing market share to foreign rivals.CreditPool photo by Kim Min-hee

Kevin Wolf, a former Commerce Department official and partner at the law firm Akin Gump, has advised several American technology companies that supply Huawei. He said he told executives that Huawei’s addition to the list did not prevent American suppliers from continuing sales, as long as the goods and services weren’t made in the United States.

A chip, for example, can still be supplied to Huawei if it is manufactured outside the United States and doesn’t contain technology that can pose national security risks. But there are limits on sales from American companies. If the chip maker provides services from the United States for troubleshooting or instruction on how to use the product, for example, the company would not be able to sell to Huawei even if the physical chip were made overseas, Mr. Wolf said.

“This is not a loophole or an interpretation because there is no ambiguity,” he said. “It’s just esoteric.”

In some cases, American companies aren’t the only source of important technology, but they want to avoid losing Huawei’s valuable business to a foreign rival. For instance, the Idaho-based Micron competes with South Korean companies like Samsung and SK Hynix to supply memory chips that go into Huawei’s smartphones. If Micron is unable to sell to Huawei, orders could easily be shifted to those rivals.

Beijing has also pressured American companies. This month, the Chinese government said it would create an “unreliable entities list” to punish companies and individuals it perceived as damaging Chinese interests. The following week, China’s chief economic planning agency summoned foreign executives, including representatives from Microsoft, Dell and Apple. It warned them that cutting off sales to Chinese companies could lead to punishment and hinted that the companies should lobby the United States government to stop the bans. The stakes are high for some of the American companies, like Apple, which relies on China for many sales and for much of its production.

A FedEx warehouse in Kernersville, N.C. “FedEx is a transportation company, not a law enforcement agency,” the company said in a complaint against the government.CreditTravis Dove for The New York Times

Mr. Wolf said several companies had scrambled to figure out how to continue sales to Huawei, with some businesses considering a total shift of manufacturing and services of some products overseas. The escalating trade battle between the United States and China is “causing companies to fundamentally rethink their supply chains,” he added.

That could mean that American companies shift their know-how, on top of production, outside the United States, where it would be less easy for the government to control, said Martin Chorzempa, a research fellow at the Peterson Institute for International Economics.

“American companies can move some things out of China if that’s problematic for their supply chain, but they can also move the tech development out of the U.S. if that becomes problematic,” he said. “And China remains a large market.”

“Some of the big winners might be other countries,” Mr. Chorzempa said.

Some American companies have complained that complying with the tight restrictions is difficult or impossible, and will take a toll on their business.

On Monday, FedEx filed a lawsuit against the federal government, claiming that the Commerce Department’s rules placed an “impossible burden” on a company like FedEx to know the origin and technological makeup of all the shipments it handles.

FedEx’s complaint didn’t name Huawei specifically. But it said that the agency’s rules that have prohibited exporting American technology to Chinese companies placed “an unreasonable burden on FedEx to police the millions of shipments that transit our network every day.”

“FedEx is a transportation company, not a law enforcement agency,” the company said.

A Commerce Department spokesman said it had not yet reviewed FedEx’s complaint but would defend the agency’s role in protecting national security.

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U.S. Tech Companies Sidestep a Trump Ban, to Keep Selling to Huawei

SHANGHAI — A number of the United States’ biggest chip makers have sold millions of dollars of products to Huawei despite a Trump administration ban on the sale of American technology to the Chinese telecommunications giant, according to four people with knowledge of the sales.

Since the Commerce Department enacted the ban in May, American companies including Intel and Micron have found ways to sell technology to Huawei, said the people, who spoke on the condition they not be named because they were not authorized to disclose the sales.

The components began to flow to Huawei about three weeks ago, the people said. Goods produced by American companies overseas are not always considered American-made, and the suppliers are taking advantage of this. The sales will help Huawei continue to sell products such as smartphones and servers.

The deals underscore how difficult it is for the Trump administration to clamp down on companies that it considers a national security threat, like Huawei. They also hint at the possible unintended consequences from altering the web of trade relationships that ties together the world’s electronics industry and global commerce.

ImageWestlake Legal Group merlin_149714850_de19f104-878f-40b3-ba6d-28b0db38a918-articleLarge U.S. Tech Companies Sidestep a Trump Ban, to Keep Selling to Huawei United States Politics and Government Trump, Donald J Micron International Trade and World Market Intel Corporation Huawei Technologies Co Ltd Fedex Corporation Corporations Computer Chips Commerce Department China

American companies like Intel may sell technology supporting current Huawei products until mid-August.CreditAly Song/Reuters

The Commerce Department’s move to block sales to Huawei, by putting it on a so-called entity list, set off confusion within the Chinese company and its many American suppliers, the people said. Many executives lacked deep experience with American trade controls, leading to initial suspensions in shipments to Huawei until lawyers could puzzle out which products could be sent. Decisions about what can and cannot be shipped were also often run by the Commerce Department.

American companies may sell technology supporting current Huawei products until mid-August. But a ban on components for future Huawei products is already in place. It’s not clear what percentage of the current sales were for future products. The sales have most likely already totaled hundreds of millions of dollars, the people estimated.

While the Trump administration has been aware of the sales, officials are split about how to respond, the people said. Some officials feel that the sales violate the spirit of the law and undermine government efforts to pressure Huawei, while others are more supportive because it lightens the blow of the ban for American corporations. Huawei has said it buys around $11 billion in technology from United States companies each year.

Intel and Micron declined to comment.

“As we have discussed with the U.S. government, it is now clear some items may be supplied to Huawei consistent with the entity list and applicable regulations,” John Neuffer, the president of the Semiconductor Industry Association, wrote in a statement on Friday.

“Each company is impacted differently based on their specific products and supply chains, and each company must evaluate how best to conduct its business and remain in compliance.”

The Idaho-based Micron competes with South Korean companies like Samsung to supply memory chips that go into Huawei’s smartphones.CreditKai Pfaffenbach/Reuters

In an earnings call Tuesday afternoon, Micron’s chief executive, Sanjay Mehrotra, said the company stopped shipments to Huawei after the Commerce Department’s action last month. But it resumed sales about two weeks ago after Micron reviewed the entity list rules and “determined that we could lawfully resume” shipping a subset of products, Mr. Mehrotra said. “However, there is considerable ongoing uncertainty around the Huawei situation,” he added.

The Commerce Department did not immediately respond to requests for comment.

The fate of Huawei, a crown jewel of Chinese innovation and technological prowess, has become a symbol of the economic and security standoff between the United States and China. The Trump administration has warned that Chinese companies like Huawei, which makes telecom networking equipment, could intercept or secretly divert information to China. Huawei has denied those charges.

President Xi Jinping of China and President Trump are expected to have an “extended” talk this week during the Group of 20 meetings in Japan, a sign that the two countries are again seeking a compromise after trade discussions broke down in May. After the talks stalled, the Trump administration announced new restrictions on Chinese technology companies.

While the Trump administration has pointed to security and legal concerns to justify its actions, some analysts have worried that Huawei and other Chinese tech companies were becoming pawns in the trade negotiations. Along with Huawei, the administration blocked a Chinese supercomputer maker from buying American tech, and it is considering adding the surveillance technology company Hikvision to the list.

Kevin Wolf, a former Commerce Department official and partner at the law firm Akin Gump, has advised several American technology companies that supply Huawei. He said he told executives that Huawei’s addition to the list did not prevent American suppliers from continuing sales, as long as the goods and services weren’t made in the United States.

The SK Hynix plant in Icheon, South Korea. American companies are worried about losing market share to foreign rivals.CreditPool photo by Kim Min-hee

A chip, for example, can still be supplied to Huawei if it is manufactured outside the United States and doesn’t contain technology that can pose national security risks. But there are limits on sales from American companies. If the chip maker provides services from the United States for troubleshooting or instruction on how to use the product, for example, the company would not be able to sell to Huawei even if the physical chip were made overseas, Mr. Wolf said.

“This is not a loophole or an interpretation because there is no ambiguity,” he said. “It’s just esoteric.”

In some cases, American companies aren’t the only source of important technology, but they want to avoid losing Huawei’s valuable business to a foreign rival. For instance, the Idaho-based Micron competes with South Korean companies like Samsung and SK Hynix to supply memory chips that go into Huawei’s smartphones. If Micron is unable to sell to Huawei, orders could easily be shifted to those rivals.

Beijing has also pressured American companies. This month, the Chinese government said it would create an “unreliable entities list” to punish companies and individuals it perceived as damaging Chinese interests. The following week, China’s chief economic planning agency summoned foreign executives, including representatives from Microsoft, Dell and Apple. It warned them that cutting off sales to Chinese companies could lead to punishment and hinted that the companies should lobby the United States government to stop the bans. The stakes are high for some of the American companies, like Apple, which relies on China for many sales and for much of its production.

Mr. Wolf said several companies had scrambled to figure out how to continue sales to Huawei, with some businesses considering a total shift of manufacturing and services of some products overseas. The escalating trade battle between the United States and China is “causing companies to fundamentally rethink their supply chains,” he added.

A FedEx warehouse in Kernersville, N.C. “FedEx is a transportation company, not a law enforcement agency,” the company said in a complaint against the government.CreditTravis Dove for The New York Times

That could mean that American companies shift their know-how, on top of production, outside the United States, where it would be less easy for the government to control, said Martin Chorzempa, a research fellow at the Peterson Institute for International Economics.

“American companies can move some things out of China if that’s problematic for their supply chain, but they can also move the tech development out of the U.S. if that becomes problematic,” he said. “And China remains a large market.”

“Some of the big winners might be other countries,” Mr. Chorzempa said.

Some American companies have complained that complying with the tight restrictions is difficult or impossible, and will take a toll on their business.

On Monday, FedEx filed a lawsuit against the federal government, claiming that the Commerce Department’s rules placed an “impossible burden” on a company like FedEx to know the origin and technological makeup of all the shipments it handles.

FedEx’s complaint didn’t name Huawei specifically. But it said that the agency’s rules that have prohibited exporting American technology to Chinese companies placed “an unreasonable burden on FedEx to police the millions of shipments that transit our network every day.”

“FedEx is a transportation company, not a law enforcement agency,” the company said.

A Commerce Department spokesman said it had not yet reviewed FedEx’s complaint but would defend the agency’s role in protecting national security.

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FedEx Says It’s Ending Express Shipping Service for Amazon

Westlake Legal Group 07fedex-facebookJumbo FedEx Says It’s Ending Express Shipping Service for Amazon Shopping and Retail Fedex Corporation E-Commerce Delivery Services Amazon.com Inc

It’s unusual when a major corporation boasts about its decision to cut back on doing business with Amazon.

But FedEx’s announcement on Friday that it would not renew its contract to provide express shipping service for Amazon in the United States was a signal that it believes e-commerce is bigger than just one company. FedEx said its “strategic decision” would allow it to focus on “serving the broader e-commerce market.”

“FedEx has already built out the network and capacity to serve thousands of retailers in the e-commerce space, including brands such as Target, Walgreens and Walmart,’’ a FedEx spokeswoman said in a statement.

Walmart has become a particularly large FedEx customer, analysts say, and the move not to renew the contract shows how the shipping company is deepening ties with Amazon’s biggest rival.

The express service is typically the fastest way customers can send packages, including overnight shipping. Such speed and convenience have become a requirement for a growing number of American shoppers.

Friday’s move also reflects how Amazon has gone from simply a sought-after customer to a direct competitor of FedEx. As Amazon has built its own delivery capacity through a fleet of airplanes and same-day couriers, the internet giant has been able to ship more of its products on its own and control its costs. That has put FedEx in an untenable position of essentially competing with Amazon for Amazon’s own business.

FedEx is betting on other retailers, which are expanding their e-commerce businesses but still need shipping companies to help them fulfill their express orders. FedEx said e-commerce was expected to double to 100 million packages a day in the United States by 2026.

“FedEx is sending a message to all the other customers: We are making delivery capacity available to you that was otherwise consumed by Amazon,” said Satish Jindel, founder of ShipMatrix, a technology provider for the shipping industry.

Amazon accounts for just 1.3 percent of FedEx’s total revenue, and the express contract was only a portion of that business. Analysts said FedEx was likely to continue to provide other services to Amazon, such as ground, freight and international delivery.

The decision to end the express deliveries is part of the profound reordering of the retail industry driven largely by the escalating battle between Amazon and Walmart.

FedEx appears to be siding with Walmart. The retailer has been ramping up its offers of two-day and same-day delivery in more markets, which means vastly more package volume. The two companies also said recently that they were adding 500 FedEx retail locations in Walmart stores.

The e-commerce boom has forced FedEx to look for ways to reduce its costs, especially on time-consuming residential routes in rural areas. Consumers have come to expect free shipping, but it can be costly for retailers and the delivery companies to reach all of these far-flung houses within the short time window.

Earlier this week, FedEx said it was planning to hire 700 flexible, part-time workers, who are expected to earn less than the company’s unionized work force. Amazon already uses a large number of flexible workers to make deliveries.

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