Cloudsyte Daily

Dr. Dickson W. Co-Founder, Cloudsyte

13 Oct 2021


Cloudsyte Daily

Friday – 10/22/2021

Continuous manufacturing bill clears House. The US House of Representatives bill, H.R. 4369, aimed at promoting advanced manufacturing. The bill creates national centers for excellence in continuous manufacturing at several universities in the US. This is great news for domestic manufacturing. Ref

Build Back Better. President Joe Biden’s lobbying of Democratic senators Joe Manchin of West Virginia and Kyrsten Synema of Arizona may be yielding results and can lead to the passing of two huge infrastructure bills – one for traditional roads and bridges and the other, for “human infrastructure.” Time to position yourself on what opportunities these bills offer. Ref

Almost out of Warehouse Space? Warehouse space availability fell to record lows adding to the  Supply-Chain crunch. There is a 1% vacancy rate in the Los Angeles area. There is a 3.6% vacancy rate in the 41 million square feet of warehouse space in the US. This is down from 4.3% in the same quarter of 2020. Ref


Thursday 10/21

Chip shortage + Micron. Micron Technology announced that it will be investing $150bn worldwide in the next 10 years “in leading-edge memory manufacturing and research and development, including potential U.S. fab expansion”. This is good news to the industry. Ref

Lasership acquired OnTrac in a $1.3-billion. This will increase competition, ultimately putting pricing pressure on FedEx and UPS. LaserShip and OnTrac cover both U.S. coasts and are now planning to fill out the middle of the country. Ref

Shipmonk expands into Mexico. Shipmonk is an E-commerce fulfillment provider that focuses on companies that manufacture outside of the US. Outsourced manufacturing has played a major role in the growth of this sector. Ref


Wednesday 10/20

XPO Logistics opened a new 150,000-square-foot LTL center in Chicago. This 264 dock doors facility will handle industrial parts, bulk goods and palletized freight. Freight services demand has skyrocketed, thanks to the astronomical growth of e-commerce and a rebound in manufacturing. Ref

Some suppliers are struggling and hurting due to slow-paying customers. With the growing supply chain crisis, suppliers are compelled to accept longer payment terms from buyers. As everyone fights to protect their cash flow, the stability of the suppliers involved is threatened. Ref

SoftBank-funded Flock Freight Raises $215 Million. The startup helps pool goods from shippers to offer less-than-truckload services enabling them to skip freight hubs using AI. The company is now a unicorn at $1.3 billion.Ref


Tuesday 10/19/21

Manufacturing: The future of mobility is definitely electric. Toyota held an event to celebrate the all-new 2022 Tundra coming off the production line. Electric is not the news, the question is how the US manufacturing industry will position itself to serve this growing industry. Are you ready?

Ford also rolled out its China-built Mustang Mach-E today. Competition across the pond? Ref:

Amazon's U.S. parcel shipping volumes are up 21% compared to 2020. The company has now surpassed FedEx volumes and is just behind UPS. Ref

Apple announced a significant revamp of the MacBook Pro. These more powerful computers will bear Apple’s homegrown chips (M1 Pro and M1 Max are said to be 70% faster than M1 chips), This strips Intel Corp of a great partnership. Ref

Monday 10/18/21

Maersk dropped shipping of COVID 19 supplies to $1 for a 40-foot container. This was a partnership with Princeton Foundation for Peace & Learning to deliver donated COVID 19 supplies to India. This signals an opportunity for companies producing COVID 19 related supplies to partner with shippers for special rates. Ref

The limited air cargo shipping capacity from Asia to US is about to see more delays. This has been occasioned by the recent COVID 19 outbreaks in Hong Kong that are expected to add delays of 2-3 days to shipments. Ref

The Biden Administration seems to be doing the best it can to coordinate traffic at the ports. Samsung Electronics North America President and Chief Executive Officer, KS Choi met with Kamala Harris and agreed to move more than 5,000 containers in the next few days out of LA and Long Beach ports. This is expected to ease congestion. Ref


Thursday 10/14/21

Amazon: 1,000 third-party sellers on Amazon marketplace are expected to be acquired in 2021. This will definitely shift the balance. This strategy is called rollup, where PE firms scoop businesses that are similar, combine them into one company, cut redundancies, and sell them for much higher than they bought them for. Watch this space and position yourself appropriately. Ref

Automation: Factory and warehouse automation kick into high gear as companies grapple with labor shortages and increasing costs as well as pandemic complexities. Robotic companies and collaboration software stand to gain.

Logistics: Amazon is reportedly shopping for cargo planes to ship merchandise straight from China. Though more expensive, this can evade port delays leading to quicker deliveries. Ref


Wednesday 10/13/21

Chip shortages continue: There will be things that you won’t get for Christmas. Apple, just like many other companies announced that it will cut down on the number of iPhone 13s made this year due to computer chip shortages. Ref.

Plans are underway to unchoke US ports: The congestion at US seaports has been astounding, but help is on the way. The port of Los Angeles is reported to be preparing to move to a 24/7 operating mode which will see more cargo being moved. Other ports will likely be nudged to move to extended operation hours. DMV reported 50,000 CDL learners permits were issued each month in 2021, a 60% increase since 2021, which will definitely help with ground transportation. Ref.

China’s week-long holiday and backlogs: Shanghai and Ningbo ports are seeing a huge backlog of container vessels waiting to berth following the week-long holiday. This will translate to product shortages for consumers in the United States. Rollover rates for containers missing sailing dates are up to 36%. Ref.

Plan accordingly


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