Businesses appear to be doubling down on plans to consolidate their supply chains closer to home, as leaders have prioritized moving out of China thanks in large part to U.S. tax credits for domestic clean energy, electric vehicles and semiconductor manufacturing.
Of the 166 CEOs and COOs surveyed by consulting firm Bain & Company, of which 39% were based in the U.S., more than 80% said that they have plans to bring their supply chains closer to market, while 64% have invested in either split-shoring or nearshoring their operations. That's been driven by a variety of factors, Bain says, including heightened geopolitical turbulence, rising costs in China, pressure to reduce carbon emissions, and incentives from countries like the U.S. to reshore manufacturing efforts.
"The multiple disruptions companies have grappled with since the pandemic mean the question for company leaders is no longer whether to reinvent supply chains, but how to do that so their operations are made more cost-competitive, resilient, sustainable and agile in responding to evolving markets and customer needs," Bain partner Hernan Saenz said.
Read More: Nearshoring to Mexico in 2024 — What to Consider Before You Relocate
This comes as businesses have been faced with the possibility of new tariffs from the upcoming Trump administration in the U.S. Over the course of his campaign, Trump vowed to enact 60-100% tariffs on Chinese imports, as well as 25% tariffs on all Mexican imports. Should the president-elect follow through on his proposed tariffs against Mexico, it could potentially curtail efforts from many businesses across the globe to move their operations south of the U.S border.
According to a report from the Boston Consulting Group, foreign investments in manufacturing in Mexico have risen 20% annually since 2019, as companies from Germany, Canada and Japan among others have looked to take advantage of the country's low labor costs and proximity to U.S. markets.
Source: https://www.supplychainbrain.com/articles/40677-businesses-ramp-up-investments-in-nearshoring-split-shoring
The strong year in air cargo has been credited to ecommerce – but “traditional” air cargo might also see a bump next year, according to Xeneta.
Air cargo’s strong seasonal fourth quarter (Q4) appears to have peaked, with tonnages and rates dropping slightly in the second full week of December, including from Asia...
Since the beginning of 2024, the total volume of goods transported through seaports is estimated to have increased by approximately 14%, reaching over 570 million tons. Among...
Major disruptions in the Red Sea have triggered one of the largest realignment of global shipping routes in recent years, with Asia-Europe maritime capacity plunging by 33...
Carriers are thought to have increased rates by about 10%, both for long-haul and intra-Asian routes, according to Dimerco.
The air cargo market is unusually busy as 2024 draws to a close as shippers have been exporting goods out of China to the US ahead of expected new tariffs in January.
Global air cargo average spot rates rose by a further +4% in the first full week of December to a 2024 high of US$3.30 per kilo
With rate and surcharge increases looming from both FedEx and UPS, businesses that need bulkier products delivered are going to feel the sting
A “very strong Q4” for air cargo will likely turn into a record peak season, according to IATA economist Ghislaine Lang, but the growth will be hard to sustain next year.
A combination of strong heavy-lift and outsized cargo demand, tight air cargo capacity and surging air freight rates has led to a modal shift in shipments from air to multipurpose...
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