At the heart of global logistics, the network of trade lanes and supply-chain flows is undergoing a profound structural shift — one that the world’s largest freight-forwarder believes will not simply reverse once current disruptions subside.
Raj Subramaniam, Chief Executive Officer of FedEx Corp., was quoted as saying at an event that his company is witnessing what he described as a “new equilibrium state” in supply-chain patterns — one characterised by stronger regionalisation, heightened geopolitical frictions and faster capacity-shifting by logistics players.
Trade Volatility Hits Hard
FedEx first flagged the gravity of these disruptions in September, estimating that trade volatility in 2025 may cut its revenue by approximately US $1 billion — most of the impact attributed to a sharp decline in shipments from China into the United States. The China-US lane, once among the most lucrative intercontinental flows, has been hit hardest by tariffs and regulatory shifts.
Subramaniam noted that while industrial-economy flows will take longer to recalibrate, once the shift has occurred “it’s difficult to go back.”
The Rise of Regionalisation
According to FedEx’s assessment, several dynamics are pushing companies toward more regionally anchored supply chains:
Geopolitical risks and trade-policy shocks are increasing the cost of long, global supply chains.
Advances in technology and automation are enabling logistics players to redeploy capacity more rapidly than manufacturing can shift production. “We can move our capacity far faster than manufacturing can move. So we know from the bottom up… we can react,” said Subramaniam.
Trade flows are already shifting: FedEx reports a noticeable diversion of flow volumes from China not only to the U.S., but increasingly to Europe, Latin America and other parts of Asia.
Implications for the Logistics Ecosystem
For logistics providers, this evolving supply-chain landscape demands both flexibility and foresight:
Asset-deployment strategies must become more dynamic: aircraft, warehouses and fleets will need to be repositioned faster in response to changing trade flows.
Inventory strategies will need adjustment as firms may choose to hold more buffer stock or shift sourcing closer to end-markets to hedge against disruption risk.
Logistics service providers should expect sustained pressure on previously high-margin long-haul lanes — especially those linking China to the U.S. — and must be ready to pivot into emerging corridors.
At the same panel, Peter Voser, Chairman of ABB Ltd., echoed the view that these are not episodic disruptions tied to an election cycle, but structural shifts. “Companies across the world, in all industries, are taking much more into account that the disruption effect is much more costly compared to actually keeping your product on the inventory side,” he observed.
What This Means for India and Asia
For the Indian logistics and export community, the long-term message is clear:
With Western importers increasingly looking to diversify away from China or establish regional supply-chain nodes, India has an opportunity to position itself as an alternative or complementary manufacturing-logistics base.
Logistics service providers and freight-forwarders in India may see an uptick in inbound and outbound activity from Asia-Pacific, Latin America or intra-Asia corridors.
Service-model innovation — such as quicker asset-turnaround, modular logistics hubs and improved regional hub-and-spoke models — will become a differentiator.
In short, what might have looked like a temporary shock is unfolding into a structural realignment of how goods move globally. For logistics players — from integrators to regional freight networks — the challenge will be anticipating this change, not simply reacting to it.
Source: https://www.logisticsinsider.in/global-supply-chain-shocks-signal-lasting-change-fedex-warns/
Rates continue rising as Southeast Asia to US demand booms
China's implementation of licensing requirements for yttrium exports represents a calculated strategic manoeuvre in the broader context of critical minerals diplomacy.
The International Air Transport Association (IATA), alongside the governments of Japan, Malaysia and key industry partners, has issued a joint statement at COP30 calling for...
Optimism was the prevailing tone as Asia Pacific’s airline leaders convened in Bangkok from 14–15 November 2025 for the 69th Association of Asia Pacific Airlines (AAPA) Assembly...
Air cargo services between India and Afghanistan will be launched soon, an Indian foreign ministry official said on Friday, as the two countries seek to reset ties amid soured...
A new MHI report for 2026 predicts a shift toward earlier planning and stronger resilience
European Union ministers on Thursday voted to eliminate duty-free status for small parcel imports, joining the United States in upending a popular mechanism for e-commerce...
PwC India's survey says shifting tariffs, uncertainty are testing supply chain resilience, even as firms underuse AI, face rising ESG pressures and struggle to give supply...
Preliminary figures for China’s biggest shopping event of the year indicated slower sales as consumers tie their purse strings tighter amid weak economic growth.
ALS