In Case You Missed It

• Who were this year's top disruptors? Check out The Supply Chain Dive Awards for 2017.
• Freight brokers expect higher demand — and rates — to follow the ELD mandate.
• Grocery e-commerce was all the buzz this year, but could it be just hype?

Market Snapshot

The end of the year is the perfect time to look back at old goals and evaluate their feasibility in the year to come.

Over the past year, political discourse in the United States has focused plainly on our manufacturing sector's competitiveness. The Trump administration's goal was to regain global strength in this industry, using all the tools at the Executive Branch's disposal — including trade and economic policy.

The McKinsey Global Institute recently released a report investigating what it would take for the global industry to reshore to the U.S. According to Supply Chain Digest, the Institute concluded the U.S. could "boost manufacturing value added by up to $530 billion (20%) over current trends by 2025," if policies were successful.

The trick? Focusing on the future, not the past. Rather than trying to be competitive in steel and other rust-belt industries, the U.S. should focus on the industries that are currently thriving in the U.S. — such as electronics, pharmaceuticals and aerospace.

Even then, the huge value added will not come easily. Policymakers and the industry alike must find ways to strengthen U.S. suppliers, facilitate global engagement, boost digital adoption and invest in a modern labor force.

In the meantime, manufacturing executives should take stock at the fact the industry is thriving, both in terms of production and labor acquisition. A few highlights based on recent reports:

• Manufacturing added 31,000 jobs in November, bringing annual job growth up to 189,000 for the industry, according to the Bureau of Labor Statistics.
• Last month marked the 15th consecutive month of growth for the industry, according to the Manufacturing ISM Report on Business.
• Productivity in the U.S. rose 3% YoY in Q3, although wages rose "moderately," according to The Wall Street Journal.

Technically Speaking

Delivery robots are still in the test phase, but the city of San Francisco is already implementing rules for how many can be on the streets and how many a company is allowed to make, according to the San Francisco Chronicle.

The report says companies are limited to three robots each and the entire city to nine robots total, and they can only be active in industrial areas. Those are pretty steep restrictions, and could slow robot integration in the area but also prompt companies to innovate elsewhere.

In other robot news, Fetch Robotics just landed $25 million in venture capital to continue manufacturing robots for warehouses, and — to continue the theme of automation this week — brewing company Anheuser-Busch (who makes Budweiser beer) just reserved 40 of Tesla's electric trucks, according to The Wall Street Journal.

Breaking Ground

Big Lots plans to build a 1.35 million square foot distribution center in Southern California, according to the Columbus Dispatch, and the Wilmington Business Journal reported earlier this week that the Port of Wilmington will add a 300,000 square foot "industrial facility."

To "revive" its air cargo business, New York's JFK airport plans to invest $132 million in its air cargo facilities, which includes tearing down two old warehouses and building two new ones, according to The Loadstar.

The airport's move makes sense in light of recent air cargo demand, which is shooting through the roof due to the rise of e-commerce.

Mergers and Analysis

The healthcare industry is consolidating at breakneck speeds, prompting shifts in drug supply networks. This week alone saw a series of deals announced that promise to transform the industry.

On Sunday, news broke CVS bought Aetna for $69 billion. The massive merger would, for the first time, allow a pharmaceutical retail chain to control its full drug supply chain — from procurement to fulfillment. Kate Patrick breaks down how the news could affect drug prices, both for CVS and its competitors. 

Later in the week, UnitedHealth announced its service and innovation arm Optum would buy DaVita clinics for $4.9 billion and team up with Walgreens, to expand its clinical presence. While the two deals are much smaller in value, they reflect the growing competition in the industry, and a drive to integrate business vertically. 

3PLs are not sleeping on this news, however. Consolidation in any industry typically drives to at least temporary gains for logistics providers, as businesses need help managing and redesigning larger supply networks. In recent weeks, Amazon and UPS have made headlines for new healthcare initiatives and cold chain investments.