Ben Ames has spent 20 years as a journalist since starting out as a daily newspaper reporter in Pennsylvania in 1995. From 1999 forward, he has focused on business and technology reporting for a number of trade journals, beginning when he joined Design News and Modern Materials Handling magazines. Ames is author of the trail guide "Hiking Massachusetts" and is a graduate of the Columbia School of Journalism.
A White House executive order issued today to push back against monopolistic mergers and consolidations is getting mixed grades from industry voices, earning praise from small business groups but criticism from corporate trade associations.
According to the Biden Administration, the order is intended “to promote competition in the American economy, which will lower prices for families, increase wages for workers, and promote innovation and even faster economic growth.” It would do that by ordering 72 initiatives at more than a dozen federal agencies, including a call for the two top antitrust agencies—the Department of Justice (DOJ) and Federal Trade Commission (FTC)—to enforce antitrust laws vigorously and even consider challenging prior mergers.
The order, titled “Promoting Competition in the American Economy,” also calls out to the Department of Transportation (DOT), saying that the air travel, freight rail, and maritime shipping sectors are dominated by a few, large corporations.
In examining airplane operators, the policy focuses mostly on the passenger travel segment, saying that the top four commercial airlines control nearly two-thirds of the domestic market, leading to reduced competition and increased fees for baggage and cancellations. The order could lead to better disclosure or refunding of those charges under some conditions.
For the rail market, the order says the number of “Class I” railroads has shrunk from 33 in 1980 to just seven in 2021, and four major rail companies now dominate their respective geographic regions. Under those conditions, “Freight railroads that own the tracks can privilege their own freight traffic—making it harder for passenger trains to have on-time service—and can overcharge other companies’ freight cars,” the order says. In response, the order encourages the Surface Transportation Board “to require railroad track owners to provide rights of way to passenger rail and to strengthen their obligations to treat other freight companies fairly.”
Finally, in the maritime shipping segment, the largest 10 shipping companies controlled 12% of the market in 2000 but control more than 80% today. Armed with that much leverage, container shippers have been charging exporters exorbitant fees for detention and demurrage time when freight is sitting waiting to be loaded or unloaded, the White House said. To address that, the order encourages the Federal Maritime Commission to ensure vigorous enforcement against shippers charging American exporters inflated charges.
According to the Main Street Alliance, a national coalition of small business owners, the executive order would help tip the scales against “monopolistic market practices” often deployed by huge corporations. “For policymakers interested in a robust, competitive small business economy, passing new anti-monopoly laws must be a key federal priority in 2021. Antitrust regulation is one place where we can look to build a more resilient and fair economy coming out of the pandemic,” Main Street Alliance Executive Co-Directors Chanda Causer and Stephen Michael said in a release.
But change may be slow to come. The “massive consolidation” of ocean and rail providers over the last 20 years has indeed contributed to the historically tight freight capacity and high costs now pinching shippers, according to the supply chain visibility platform provider FourKites. But the regulatory solutions proposed by this executive order face an “uphill train ride with many bumps” before they could provide any relief, Glenn Koepke, senior vice president of Customer Success at FourKites, said in an email.
“Each presidency brings a shift in policies, and with the Trump era a lot of the focus was around a strong push to protect the American economy by implementing tariffs and other duties, which caused immediate challenges for operators to get goods in when needed,” Koepke said. “The Biden era presidency has been placing a strong focus on supporting competition and introducing policies that may make it harder for larger companies to continue to dominate their trade. Major companies all have lobbyists in DC helping to push certain agendas. So on the surface, while this seems like a potential relief valve, shippers will continue to see a volatile market for as long as demand remains high globally.”
Trade groups representing corporate interests were even more skeptical, with the National Association of Manufacturers saying its members were already keeping their promise to invest, hire, and grow wages. “Some of the actions announced today are solutions in search of a problem; they threaten to undo our progress by undermining free markets and are premised on the false notion that our workers are not positioned for success,” National Association of Manufacturers President and CEO Jay Timmons said in a release. “We have challenges, to be sure, which is why we are advocating infrastructure investment, competitive tax rates, immigration reform, ensuring availability of lifesaving cures, expanded export opportunities, and more.”
Supply chain planning (SCP) leaders working on transformation efforts are focused on two major high-impact technology trends, including composite AI and supply chain data governance, according to a study from Gartner, Inc.
"SCP leaders are in the process of developing transformation roadmaps that will prioritize delivering on advanced decision intelligence and automated decision making," Eva Dawkins, Director Analyst in Gartner’s Supply Chain practice, said in a release. "Composite AI, which is the combined application of different AI techniques to improve learning efficiency, will drive the optimization and automation of many planning activities at scale, while supply chain data governance is the foundational key for digital transformation.”
Their pursuit of those roadmaps is often complicated by frequent disruptions and the rapid pace of technological innovation. But Gartner says those leaders can accelerate the realized value of technology investments by facilitating a shift from IT-led to business-led digital leadership, with SCP leaders taking ownership of multidisciplinary teams to advance business operations, channels and products.
“A sound data governance strategy supports advanced technologies, such as composite AI, while also facilitating collaboration throughout the supply chain technology ecosystem,” said Dawkins. “Without attention to data governance, SCP leaders will likely struggle to achieve their expected ROI on key technology investments.”
The U.S. manufacturing sector has become an engine of new job creation over the past four years, thanks to a combination of federal incentives and mega-trends like nearshoring and the clean energy boom, according to the industrial real estate firm Savills.
While those manufacturing announcements have softened slightly from their 2022 high point, they remain historically elevated. And the sector’s growth outlook remains strong, regardless of the results of the November U.S. presidential election, the company said in its September “Savills Manufacturing Report.”
From 2021 to 2024, over 995,000 new U.S. manufacturing jobs were announced, with two thirds in advanced sectors like electric vehicles (EVs) and batteries, semiconductors, clean energy, and biomanufacturing. After peaking at 350,000 news jobs in 2022, the growth pace has slowed, with 2024 expected to see just over half that number.
But the ingredients are in place to sustain the hot temperature of American manufacturing expansion in 2025 and beyond, the company said. According to Savills, that’s because the U.S. manufacturing revival is fueled by $910 billion in federal incentives—including the Inflation Reduction Act, CHIPS and Science Act, and Infrastructure Investment and Jobs Act—much of which has not yet been spent. Domestic production is also expected to be boosted by new tariffs, including a planned rise in semiconductor tariffs to 50% in 2025 and an increase in tariffs on Chinese EVs from 25% to 100%.
Certain geographical regions will see greater manufacturing growth than others, since just eight states account for 47% of new manufacturing jobs and over 6.3 billion square feet of industrial space, with 197 million more square feet under development. They are: Arizona, Georgia, Michigan, Ohio, North Carolina, South Carolina, Texas, and Tennessee.
Across the border, Mexico’s manufacturing sector has also seen “revolutionary” growth driven by nearshoring strategies targeting U.S. markets and offering lower-cost labor, with a workforce that is now even cheaper than in China. Over the past four years, that country has launched 27 new plants, each creating over 500 jobs. Unlike the U.S. focus on tech manufacturing, Mexico focuses on traditional sectors such as automative parts, appliances, and consumer goods.
Looking at the future, the U.S. manufacturing sector’s growth outlook remains strong, regardless of the results of November’s presidential election, Savills said. That’s because both candidates favor protectionist trade policies, and since significant change to federal incentives would require a single party to control both the legislative and executive branches. Rather than relying on changes in political leadership, future growth of U.S. manufacturing now hinges on finding affordable, reliable power amid increasing competition between manufacturing sites and data centers, Savills said.
The British logistics robot vendor Dexory this week said it has raised $80 million in venture funding to support an expansion of its artificial intelligence (AI) powered features, grow its global team, and accelerate the deployment of its autonomous robots.
A “significant focus” continues to be on expanding across the U.S. market, where Dexory is live with customers in seven states and last month opened a U.S. headquarters in Nashville. The Series B will also enhance development and production facilities at its UK headquarters, the firm said.
The “series B” funding round was led by DTCP, with participation from Latitude Ventures, Wave-X and Bootstrap Europe, along with existing investors Atomico, Lakestar, Capnamic, and several angels from the logistics industry. With the close of the round, Dexory has now raised $120 million over the past three years.
Dexory says its product, DexoryView, provides real-time visibility across warehouses of any size through its autonomous mobile robots and AI. The rolling bots use sensor and image data and continuous data collection to perform rapid warehouse scans and create digital twins of warehouse spaces, allowing for optimized performance and future scenario simulations.
Originally announced in September, the move will allow Deutsche Bahn to “fully focus on restructuring the rail infrastructure in Germany and providing climate-friendly passenger and freight transport operations in Germany and Europe,” Werner Gatzer, Chairman of the DB Supervisory Board, said in a release.
For its purchase price, DSV gains an organization with around 72,700 employees at over 1,850 locations. The new owner says it plans to investment around one billion euros in coming years to promote additional growth in German operations. Together, DSV and Schenker will have a combined workforce of approximately 147,000 employees in more than 90 countries, earning pro forma revenue of approximately $43.3 billion (based on 2023 numbers), DSV said.
After removing that unit, Deutsche Bahn retains its core business called the “Systemverbund Bahn,” which includes passenger transport activities in Germany, rail freight activities, operational service units, and railroad infrastructure companies. The DB Group, headquartered in Berlin, employs around 340,000 people.
“We have set clear goals to structurally modernize Deutsche Bahn in the areas of infrastructure, operations and profitability and focus on the core business. The proceeds from the sale will significantly reduce DB’s debt and thus make an important contribution to the financial stability of the DB Group. At the same time, DB Schenker will gain a strong strategic owner in DSV,” Deutsche Bahn CEO Richard Lutz said in a release.
Transportation industry veteran Anne Reinke will become president & CEO of trade group the Intermodal Association of North America (IANA) at the end of the year, stepping into the position from her previous post leading third party logistics (3PL) trade group the Transportation Intermediaries Association (TIA), both organizations said today.
Meanwhile, TIA today announced that insider Christopher Burroughs would fill Reinke’s shoes as president & CEO. Burroughs has been with TIA for 13 years, most recently as its vice president of Government Affairs for the past six years, during which time he oversaw all legislative and regulatory efforts before Congress and the federal agencies.
Before her four years leading TIA, Reinke spent two years as Deputy Assistant Secretary with the U.S. Department of Transportation and 16 years with CSX Corporation.