But some level of stability on the trade front developed when the Trump administration cancelled the round of tariffs slated to take place in June (only to reimplement them, then postpone again in August), and airfreight markets cooled down considerably during the first half of the year. The industry saw both volumes and rates erode in key international markets. Since November 2018, rates have declined by over 15% and international volumes by 4%, according to the International Air Transport Association (IATA). This drop marks the first decline in seasonalized freight tonne kilometers (FTK) growth since 2015. Some carriers like Cathay Pacific have responded by managing capacity.1 But IATA has also reported that demand volumes have slowed faster than capacity has left the market.
While airfreight service providers were wrestling with a tough market, innovation was kept at bay in the industry. As a result, the development of digital air forwarding solutions has lagged relative to other modes of transportation. But in the past year, digital has taken center stage. In addition to digital offerings, other technological innovations, such as the possibilities of drone transport, are becoming more real, with cargo-focused drones being tested—and now contracted—for commercial cargo lift.
Startups in the digital forwarding space are graduating from beta status. For example, SkySpace Cargo announced late in 2018 that it had eclipsed 50,000 users of its booking platform. SkySpace and other companies like Cargo.One are focused on creating transparency in pricing and capacity for small- and medium-sized forwarders. This increased visibility enables smaller forwarders to compete more effectively with larger companies.
For shippers wanting to explore digital forwarding, companies like Freightos are creating solutions for both forwarders and shippers. Freightos' WebCargo Sky solution allows other forwarders to book directly with large airlines via a network of real-time APIs (application programming interfaces). The solution also allows shippers themselves to compare and book airfreight and ocean freight shipments with global forwarders and ocean carriers. Freightos has also created a hub of distribution centers that feeds directly into Amazon fulfillment centers, enabling smaller manufacturers to achieve levels of scale comparable to much larger shippers.
Cargo drones are also driving changes to the airfreight ecosystem. Drones are generally discussed as candidates for last-mile package delivery. Now, however, companies developing bulk cargo drones are at an advanced enough stage to enter into commercial contracts. Sabrewing Aircraft Co. signed a $40 million contract in Alaska to test cargo deliveries on an isolated island more than 700 miles from Anchorage.2 The deal includes 10 drones that have a capacity of between 800 and 4,400 pounds. Natilus, another startup, is planning to test comparable seaplane drones in 2020, with ambitions of bringing 130-ton freighter drones on line.3
The implications of cargo drones on the industry will be enormous. The cost of drones is significantly lower because the airframe is design tailored specifically to move cargo, not people. Additionally, the drone's slower airspeeds will also substantially reduce fuel consumption. Finally, the fact that drones do not require a crew will provide further cost savings. Ultimately, Natilus believes their large-scale drones will operate at half the cost of the current generation of air cargo planes while creating a new class of service that bridges the gap between existing air and ocean transit times.
While the familiar pattern of boom and bust for rates is playing out in the airfreight industry, shippers reliant on air freight for their networks can get ready for these game-changing technologies. Regular dialogue with digital forwarding providers to understand the maturity of their capabilities will enable shippers to identify when the time is right for partnerships and to unlock new capabilities like dynamic spot bids and other new abilities. And while it might be several years before shippers are booking space on drones, keeping an eye on providers and building relationships with innovators now will help both sides. Innovators will get critical support to test and build value propositions for their solutions whileshippers have an opportunity to shape the development solutions tailored to their unique needs.
Specifically, 48% of respondents identified rising tariffs and trade barriers as their top concern, followed by supply chain disruptions at 45% and geopolitical instability at 41%. Moreover, tariffs and trade barriers ranked as the priority issue regardless of company size, as respondents at companies with less than 250 employees, 251-500, 501-1,000, 1,001-50,000 and 50,000+ employees all cited it as the most significant issue they are currently facing.
“Evolving tariffs and trade policies are one of a number of complex issues requiring organizations to build more resilience into their supply chains through compliance, technology and strategic planning,” Jackson Wood, Director, Industry Strategy at Descartes, said in a release. “With the potential for the incoming U.S. administration to impose new and additional tariffs on a wide variety of goods and countries of origin, U.S. importers may need to significantly re-engineer their sourcing strategies to mitigate potentially higher costs.”
The new funding brings Amazon's total investment in Anthropic to $8 billion, while maintaining the e-commerce giant’s position as a minority investor, according to Anthropic. The partnership was launched in 2023, when Amazon invested its first $4 billion round in the firm.
Anthropic’s “Claude” family of AI assistant models is available on AWS’s Amazon Bedrock, which is a cloud-based managed service that lets companies build specialized generative AI applications by choosing from an array of foundation models (FMs) developed by AI providers like AI21 Labs, Anthropic, Cohere, Meta, Mistral AI, Stability AI, and Amazon itself.
According to Amazon, tens of thousands of customers, from startups to enterprises and government institutions, are currently running their generative AI workloads using Anthropic’s models in the AWS cloud. Those GenAI tools are powering tasks such as customer service chatbots, coding assistants, translation applications, drug discovery, engineering design, and complex business processes.
"The response from AWS customers who are developing generative AI applications powered by Anthropic in Amazon Bedrock has been remarkable," Matt Garman, AWS CEO, said in a release. "By continuing to deploy Anthropic models in Amazon Bedrock and collaborating with Anthropic on the development of our custom Trainium chips, we’ll keep pushing the boundaries of what customers can achieve with generative AI technologies. We’ve been impressed by Anthropic’s pace of innovation and commitment to responsible development of generative AI, and look forward to deepening our collaboration."
Specifically, the new global average robot density has reached a record 162 units per 10,000 employees in 2023, which is more than double the mark of 74 units measured seven years ago.
Broken into geographical regions, the European Union has a robot density of 219 units per 10,000 employees, an increase of 5.2%, with Germany, Sweden, Denmark and Slovenia in the global top ten. Next, North America’s robot density is 197 units per 10,000 employees – up 4.2%. And Asia has a robot density of 182 units per 10,000 persons employed in manufacturing - an increase of 7.6%. The economies of Korea, Singapore, mainland China and Japan are among the top ten most automated countries.
Broken into individual countries, the U.S. ranked in 10th place in 2023, with a robot density of 295 units. Higher up on the list, the top five are:
The Republic of Korea, with 1,012 robot units, showing a 5% increase on average each year since 2018 thanks to its strong electronics and automotive industries.
Singapore had 770 robot units, in part because it is a small country with a very low number of employees in the manufacturing industry, so it can reach a high robot density with a relatively small operational stock.
China took third place in 2023, surpassing Germany and Japan with a mark of 470 robot units as the nation has managed to double its robot density within four years.
Germany ranks fourth with 429 robot units for a 5% CAGR since 2018.
Japan is in fifth place with 419 robot units, showing growth of 7% on average each year from 2018 to 2023.
Progress in generative AI (GenAI) is poised to impact business procurement processes through advancements in three areas—agentic reasoning, multimodality, and AI agents—according to Gartner Inc.
Those functions will redefine how procurement operates and significantly impact the agendas of chief procurement officers (CPOs). And 72% of procurement leaders are already prioritizing the integration of GenAI into their strategies, thus highlighting the recognition of its potential to drive significant improvements in efficiency and effectiveness, Gartner found in a survey conducted in July, 2024, with 258 global respondents.
Gartner defined the new functions as follows:
Agentic reasoning in GenAI allows for advanced decision-making processes that mimic human-like cognition. This capability will enable procurement functions to leverage GenAI to analyze complex scenarios and make informed decisions with greater accuracy and speed.
Multimodality refers to the ability of GenAI to process and integrate multiple forms of data, such as text, images, and audio. This will make GenAI more intuitively consumable to users and enhance procurement's ability to gather and analyze diverse information sources, leading to more comprehensive insights and better-informed strategies.
AI agents are autonomous systems that can perform tasks and make decisions on behalf of human operators. In procurement, these agents will automate procurement tasks and activities, freeing up human resources to focus on strategic initiatives, complex problem-solving and edge cases.
As CPOs look to maximize the value of GenAI in procurement, the study recommended three starting points: double down on data governance, develop and incorporate privacy standards into contracts, and increase procurement thresholds.
“These advancements will usher procurement into an era where the distance between ideas, insights, and actions will shorten rapidly,” Ryan Polk, senior director analyst in Gartner’s Supply Chain practice, said in a release. "Procurement leaders who build their foundation now through a focus on data quality, privacy and risk management have the potential to reap new levels of productivity and strategic value from the technology."
Businesses are cautiously optimistic as peak holiday shipping season draws near, with many anticipating year-over-year sales increases as they continue to battle challenging supply chain conditions.
That’s according to the DHL 2024 Peak Season Shipping Survey, released today by express shipping service provider DHL Express U.S. The company surveyed small and medium-sized enterprises (SMEs) to gauge their holiday business outlook compared to last year and found that a mix of optimism and “strategic caution” prevail ahead of this year’s peak.
Nearly half (48%) of the SMEs surveyed said they expect higher holiday sales compared to 2023, while 44% said they expect sales to remain on par with last year, and just 8% said they foresee a decline. Respondents said the main challenges to hitting those goals are supply chain problems (35%), inflation and fluctuating consumer demand (34%), staffing (16%), and inventory challenges (14%).
But respondents said they have strategies in place to tackle those issues. Many said they began preparing for holiday season earlier this year—with 45% saying they started planning in Q2 or earlier, up from 39% last year. Other strategies include expanding into international markets (35%) and leveraging holiday discounts (32%).
Sixty percent of respondents said they will prioritize personalized customer service as a way to enhance customer interactions and loyalty this year. Still others said they will invest in enhanced web and mobile experiences (23%) and eco-friendly practices (13%) to draw customers this holiday season.