Dynamo Dispatch (2023/10/02)
Issue 252 | UnitX, Peregrine Hydrogen, Kneron
Dynamo Dispatch. A weekly update from Dynamo Ventures covering the latest and greatest in supply chain, mobility, and building venture-scale businesses.
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Weekly Commentary 💭
The team spent some time last week at the MOVE Mobility conference in Austin. Companies there spanned the spectrum from startups to large corporations, but there was a persistent theme of realizing the promise of electrification. It was perfectly summed up at a talk called ‘Electrifying a Fleet While Preserving the Grid’, where the FedEx Manager of Technology and Integration said, “We’re done with science experiments, we’re now trying to really implement”.
Needless to say, we’re excited to see all of the progress and all the startups working to build the future of the mobility space.
🥰 Love reading the Dispatch? Make sure you forward it to anyone looking to stay up to date with all things supply chain and mobility.
We Are Dynamo,
Madelyn, Derrek, and the rest of the Dynamo team
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Supply Chain 📦
⭐ FTC, 17 States File Antitrust Suit Against Amazon. The 172-page complaint filed by the FTC and 17 state attorneys general alleges that the company has used monopoly power to “inflate prices, degrade quality, and stifle innovation for consumers and businesses” and that it “engages in a course of exclusionary conduct that prevents current competitors from growing and new competitors from emerging”. One prominent complaint, among others, is that Amazon has harmed its competition by requiring the use Fulfillment by Amazon, the company’s logistics platform, which in turn drives up the cost for sellers to also offer their products on other platforms. While the outcome of this lawsuit remains to be seen, it is a notable moment for the eComm landscape as the giant that has reshaped global supply chains faces a meaningful legal battle to its otherwise unchecked growth. Completely unrelated, FedEx Testing AI-powered, Trailer-Loading Robots.
1K Km with Hydrogen: Mercedes-Benz Shows What the GenH2 Truck Can Do. Prepped with two 40-kilo tanks and an additional battery charging connection, a hydrogen-powered Daimler truck has completed a record journey of 1,047 kilometers (650 miles for my fellow Americans) as it traveled from Wörth am Rhein to Berlin. This monumental feat is proof that hydrogen technology is an essential way forward for long-distance trucking decarbonization. However, the inability of the truck to drive back to its starting point due to a lack of hydrogen fuel sources in Berlin also demonstrates the need for refueling infrastructure to enable its scale. Related, Schneider National Tests Hydrogen-Powered Truck, Almost Half of California’s Hydrogen Filling Stations Offline After H2 Supply 'Disruption', and Forget Autonomous Cars, Autonomous Long Haul Trucking Is The Key To Real Emissions Reductions.
The Next Supply-Chain Challenge Isn’t a Shortage — It’s Inventory Glut. The aftereffects of the spike in demand and the supply chain shocks during the pandemic are beginning to come to fruition. Excess inventory has piled up as growth has slowed with companies now turning to dispositions of excess goods to remove them from balance sheets, leading to trillions of lost value across the globe and enormous environmental consequences. While the pandemic drove a wave of excess inventory it is not the only time this issue has or can arise. Manufacturers can fall prey to the idea that demand is “infinite” or fully predictable, and so can find themselves drowning in goods. More accurate planning parameters, collaborating with customers, and active redistribution of goods for other applications can all serve as solutions. AI can also be a powerful tool, and we anticipate seeing a swath of AI products for this purpose come to market and grow in adoption. Also, Logistics Companies Grow Cautious on Holiday Hiring.
$1.4B Committed to Rail Safety, Supply Chain Boost. Fueled by the 2021 infrastructure bill the Biden administration has awarded $1.4B to projects that improve railway safety and boost capacity. Projects include track upgrades, bridge repairs, railway connectivity, and the implementation of extreme weather safeguards. States from Tennessee to Kentucky and to California will be recipients of these funds. These improvements should function to advance a more efficient and resilient supply chain within the US. Completely unrelated, Alibaba’s Logistics Arm Files for $1B+ IPO and GIC-Backed Line Man Said to Gear Up for $300 Million IPO.
Sourcing Shift Causes Surge in South American Logistics Investment. As supply chains continue to be diversified away from China, South American ports and logistics businesses are seeing an outpouring of investment. Forwarders and carriers are also adding services to the region to capitalize on these shifts and the growing trade volumes. As a result, the region has seen both a number of new companies enter the market as well as an increase in the production of well-established players. Challenges for the pace of deployment include the high concentration of commodities, a lack of efficient infrastructure, political-governmental factors in operations, and more. However, these characteristics have not dissuaded investment from coming in, demonstrating the importance of the region given these diversification and near-shoring trends. Related, Turmoil Over Migrants at U.S.-Mexico Border Is Straining Trade Flow.
Mobility 🚗
⭐ UAW Strikes Spread as 7K More Workers at Two Plants Join Picket Line. Now in the third week, the UAW union has expanded strikes against Detroit automakers, ordering an additional 7K workers to walk off the job in Illinois and Michigan. This move is aimed at putting more pressure on Ford and GM to improve their contract offers while holding off at Stellantis due to negotiation momentum. While the automakers are willing to offer raises, they are concerned that costly contracts could make their EVs less competitive in the market. This ongoing labor dispute is watched closely by all, as the results will have long-term implications for the US EV future. For more on the strike, Ford Warns Extended UAW Strike Could Result in Up to 500K Supplier Employee Layoffs and UAW Strike Chaos Isn’t All Good News for Tesla.
Nissan Says All New Models Launched in Europe Will Be Fully Electric. Nissan has announced that all new models it launches in Europe will be fully electric, reiterating its commitment to achieve solely EV sales on the continent by 2030. Globally, Nissan plans to introduce 27 EVs and hybrids by 2030. They also aim to reduce EV battery costs by 65% through cobalt-free technology and introduce all-solid-state batteries to significantly reduce charging times. Nissan's move aligns with other automakers, including Renault, Ford, and Stellantis, who plan to make their European passenger ranges fully electric by 2030. Coming shortly after the UK delayed its ban on the sales of new gas and diesel cars to 2035, it appears that the private industry continues to move towards electrification beyond government mandates. From other automakers, Toyota to Triple EV Output as it Chases Tesla and BYD and Ford Patent Filed for Fleet Inspection and Maintenance Robot.
EV Battery Giant Northvolt to Build Multibillion-Dollar Plant in Quebec. Swedish battery manufacturing giant Northvolt has unveiled plans to construct a multibillion-dollar EV battery plant east of Montreal covering 170 hectares, marking it the largest private investment in Quebec's history. The initial phase of the project, valued at $7B, will have an annual battery cell manufacturing capacity of up to 30 GWh, generating up to 3K jobs in the region. The second phase, doubling output, has no specified timeline yet. Quebec and Ottawa will invest a total of $2.7B in the factory, aiming for completion by the end of 2026. Northvolt's choice of Quebec was influenced by its access to renewable energy and raw materials but now face concerns about potential noise, pollution, and housing issues related to the plant. Related, Quebec in Talks with Battery and Automakers for $11B in EV Supply Chain Investments.
Automakers Say They Face $14B in Fines From Biden’s ‘Unfeasible’ Fuel Rules. The Alliance for Automotive Innovation, representing major automakers like GM, Toyota, Volkswagen, and Hyundai, has voiced concerns over the Biden administration's proposal to increase fuel economy standards through 2032. They argue that the Corporate Average Fuel Economy proposal is not feasible and could result in over $14B in fines for automakers between 2027 and 2032, and would impact a significant portion of light trucks and passenger cars. The Alliance for Automotive Innovation believes that such fines will increase costs for consumers without delivering environmental or fuel savings benefits and may lead to higher vehicle prices and older cars on the roads. This criticism echoes concerns raised earlier about the EPA’s proposal to require a high percentage of EVs by 2032; marking a gap between technological progress and government expectations. Regardless, Truck Stops Upgrade to Recharge EVs and Their Drivers.
Cruise AVs Involved in Fewer Accidents Than Human-Driven Taxis, Study Shows. A joint study conducted by The University of Michigan Transportation Research Institute and Cruise suggests that self-driving taxis are significantly safer than human-driven cabs. The study used data from 5.6M miles of ride-hail driving in SF to show that human-driven taxis were involved in 64.9 collisions per million miles driven, while Cruise AVs experienced only 23 accidents per million miles. However, Cruise AVs have caused some high-profile traffic disruptions and complaints as the company awaits regulatory approval from the NHTSA to begin production of the Cruise Origin, a dedicated self-driving robotaxi. In other autonomous news, Widespread Adoption of AVs Remains at Least a Decade Away.
The Future of Supply Chain 🎙️
Check out our podcast series that’s been running since 2018. On each episode of the Future of Supply Chain, we sit down with a different entrepreneur, investor, or industry veteran to discuss innovation, technology, and the most exciting opportunities in supply chain as we build the future of the industry together.
Fundraises and M&A 💸
UnitX Raises $5M in Venture Funding. UnitX is a robotics company building AI vision systems for manufacturing applications such as inspection and defect detection. The investment helps the company expand its geographic reach and accelerate its mission to improve manufacturing operations. The funding comes from SE Ventures, the venture fund backed by Schneider Electric.
Peregrine Hydrogen Raises $7.8M in Seed Funding. Peregrine Hydrogen uses electrolyzing technology to produce industrial chemicals and green hydrogen, decarbonizing ammonia production and simplifying supply chains. The company will use the funding to refine and scale up its proprietary technology and to expand into commodity markets, initially targeting fertilizer applications. The round was led by Bidra with participation from Builders, Gates Frontier, Presidio Ventures, RiSC Capital, and Schox.
Mundi Raises $15M in Series A-2 Funding. Mundi is a fintech platform for importers and exporters to manage payments, collections, FX management, and insurance. The capital will be used to expand operations and business reach. The round was led by Haymaker Ventures, with participation from previous investors Union Square Ventures, GMO Ventures, Upper90, Colibri Ventures, Base10, Asymmetric Capital Partners, Gaingels, Mana Ventures, and GSBackers.
AYRO Raises €19.2M in Series B Funding. AYRO offers a wingsail solution for cargo ships and yachts in an effort to decarbonize this hard-to-abate sector. SWEN Capital Partners led the round and were joined by new investors AmInvest, Colam Impact, Normandie Participations, Normandie Littoral, and another fund of SWEN Capital Partners. Existing investors Ocean Zero and Bpifrance also participated.
Atlas Raises $27M in Series A Funding. Atlas Materials is the developer of a waste-free technology to process low-grade nickel for use in EV batteries. The company has raised its Series A ahead of building a plant in North America with the aim to launch production at commercial scale by 2027 with 1.8K metric tons of annual nickel output. Investors in the round included the Grantham Environmental Trust and Voyager Ventures.
H55 Raises ₣45M in Series C Funding. H55, a Switzerland-based company serving the aviation industry with electric propulsion technologies, has raised a round led by ND Capital, Tippet Venture Partners, and RTX Ventures. The funding will be used to accelerate commercialization of its electric and hybrid propulsion solutions and battery systems and better meet the growing demand for these products.
Kneron Raises $49M in Series B Funding. Kneron is developing AI chips to power self-driving cars and other autonomous machines. The company has raised its Series B to fuel its go-to-market efforts in the automotive industry as well as expand its team, particularly within the R&D division. Leading the round was Horizons Ventures, and joined by Foxconn, Alltek, Liteon Technology Corp., Adata, and PalPilot.
Arc Raises $70M in Series B Funding. Arc is the developer of electric watercraft, beginning with electric sport boats by blending aerospace design and manufacturing techniques with traditional marine craftsmanship. The company’s Series B funding will allow it to develop and produce its next-generation product and expand operations. Eclipse led the round with participation from Menlo Ventures and current investors Andreessen Horowitz, Lowercarbon Capital, and Abstract Ventures.
Cardata Raises $100M in Funding. Cardata provides tax-compliant mileage reimbursement software for organizations. The capital will be used to accelerate market coverage and product innovation in its core systems and new offerings. The round was led by Wavecrest Growth Partners, with participation from MassMutual Ventures.
Who's Hiring? 👩💻
Be sure to check out the Dynamo website for more job opportunities at our portfolio companies!
Sales Coordinator at Steam Logistics in Chattanooga, TN.
Accounts Receivable Manager at Stord in Atlanta, GA.
Manufacturing Technician at Manna in Ireland.