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 đ
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Supply Chain đŠ
â Itâs Mexicoâs Big Moment, But Violence and Truck-Jackings Are Scaring Away Investors. Despite significant growth in trade between the US and Mexico, ongoing violent crime in Mexico, particularly in key manufacturing hubs, is hindering the country's ability to fully capitalize on its position in the near-shoring trend. Persistent security challenges, including violent cargo truck hijackings that increased 3% YoY to 7.9K in 2023, pose a significant risk to businesses operating in these areas. Without addressing these security concerns, Mexico may struggle to maximize its potential as a manufacturing powerhouse especially as the trucking union is already threatening a nationwide strike unless additional steps are taken to provide more safety. Relatedly, Mexico Aims to Compete with Panama Canal By Using Cargo Trains.
Retailers Return to Bringing in Inventory âJust in Timeâ. Retailers are reverting to just-in-time inventory management strategies, focusing on replenishing items rather than stockpiling goods in response to supply-chain disruptions. Improved visibility into production overseas and enhanced forecasting tools are enabling companies to adjust orders based on demand signals, reducing the need for excess inventory. Despite potential disruptions, retailers are more confident in the supply chain's stability and are aiming to maintain leaner inventories while boosting sales. On the topic of potential disruptions, Red Sea Disruption Wonât Sink Apparel Companies â for Now and Hapag-Lloyd to Offer Land Transit Through Saudi Arabia Amid Red Sea Disruption.
Trucks Are Getting Smarter and Truck Drivers Arenât Happy About It. Truck drivers are facing challenges with overly helpful yet flawed advanced driver-assistance systems, leading to concerns about their reliability and impact on safety. While these systems aim to mitigate accidents, they can also contribute to passive fatigue among drivers, who may become overly reliant on technology. As some startups in the driverless trucking space skip lower levels of automation to focus on fully driverless solutions, concerns about driver training, responsibility, and workplace surveillance persist among truck drivers. In other trucking news, Why Walmart Pays Its Truck Drivers Six Figures and Ryder and Kodiak Open Autonomous Truckport In Houston.
Where Textile Mills Thrived, Remnants Battle for Survival. The American garment industry, once thriving, faces challenges from the de minimis trade rule, which allows foreign companies to bypass tariffs when shipping goods worth less than $800 directly to US consumers. While this policy benefits retailers seeking lower prices, it undermines domestic manufacturers that has to invest heavily in training and efficiency to compete. Despite efforts to maintain quality and efficiency, the industry struggles amid declining orders and increasing overseas competition, highlighting the need for policy changes to support American manufacturing. Elsewhere, Japan Export Beat Lifts Odds Economy Resumed Growth Last Quarter.
Supply Chain and Procurement Leaders Are Flocking to GenAI. Supply chain leaders are increasingly adopting GenAI to enhance productivity and decision-making processes, with half planning deployment within the next 12 months. Additionally, 46% of respondents anticipate increased productivity as a key benefit of AI implementation, while 5.8% of supply chain budgets are allocated to AI investment. Other anticipated benefits include increased business agility, cost reductions, and improved profitability, although expectations of significant staff reductions may be overly ambitious given the early stages of adoption. Across the tech landscape, CH Robinson Says It Is First 3PL to Deploy Electronic Bill of Lading Standard and Samsara Files Federal Lawsuit Against Motive for Patent Infringement.
Mobility đ
â The US Desperately Needs EVs Under $50,000. Theyâre On the Way. Despite some carmakers trimming production of EVs at the end of last year, 24 all-new all-battery-powered vehicles are expected to launch in the US in 2024, representing a nearly 50% increase in available models. Some of these new EVs will start at less than $50,000, addressing the issue of affordability which has been a barrier to widespread adoption. While EV adoption is on the rise, challenges like high interest rates, charging infrastructure concerns, and inventory issues still persist, but the production of more affordable EVs at scale is seen as a solution to these problems. On the other end of the price spectrum, Hereâs the Production Version of Porscheâs First Electric Macan SUV and elsewhere, Ford Rival Stellantis Says it Will Avoid EV Price Cuts.
FAA Halts Boeing 737 Production Expansion; Allows MAX 9 to Fly. The FAA has denied Boeing's request to expand 737 MAX production following a mid-air emergency on an Alaska Airlines flight involving the MAX 9 model. The incident, which occurred on January 5th, led to the grounding of 171 737 MAX 9 jets and the cancellation of numerous flights by U.S. carriers. The FAA cited the need to ensure accountability and quality control procedures as the reasons behind the production halt, causing Boeing's shares to drop about 4% in after-hours trading. Related, Alaska Airlines and United Airlines are Returning Boeing 737 Max 9 Jets to Service.
US New Vehicle Sales to Slip in January - Report. Driven by slower seasonal sales and reduced demand for EVs, US new vehicle sales are anticipated to drop by 1.5% in January compared to the previous year. This decline is attributed to consumers typically making their vehicle purchases in December to take advantage of year-end sales and incentives. Additionally, changes in government rebate criteria for EVs, effective from January 1st, led to a drop in EV retail share from 9.2% to 8.1% in January, resulting in a decrease in the average transaction price for new vehicles to $45,106. Also, US New-Vehicle Inventory Expected to Rise Again in 2024, Forecast Says and Dealerships Look to Cut Costs Through Sustainability Projects.
Cruise Reveals DOJ, SEC Probes as it Releases Internal Report on Pedestrian Crash. Federal investigations by the DOJ and the SEC have been initiated into GM's self-driving subsidiary Cruise following an incident where a pedestrian was hit and dragged by one of its robotaxis on October 2nd. The investigations, revealed in an internal report by law firm Quinn Emanuel Urquhart & Sullivan, have led to a loss of permits for Cruise to operate in California, significant layoffs, and the resignation of its CEO, Kyle Vogt. The report attributes Cruise's troubles to leadership missteps, strained relations with regulators, and a focus on correcting media narratives rather than providing complete information. As autonomous vehicles continue in their journey to mass adoption, this incident highlights the importance of prioritizing safety in the technologyâs path to market.
Worldâs Largest EV Battery Maker Set to Cut Costs in Half by Mid 2024. Chinese battery storage manufacturer CATL is planning to cut the cost per kWh of its lithium iron phosphate (LFP) cells by 50% by mid-2024. These high-capacity cells can be fully charged in under 30 minutes and will be sold to EV makers at an average price of RMB 400/kWh ($56.47/kWh). This significant reduction in battery costs, from the previous average of RMB 800 to RMB 900 per kWh in mid-2023, is expected to save EV makers over $3,000 per vehicle. This reduction as well as the pressure it puts on competitors to further reduce their own costs should aid manufacturers in the journey to making electric cars more affordable. Elsewhere in batteries, Northvolt Joins the Fair Cobalt Alliance.
The Future of Supply Chain đïž
Check out our podcast series thatâs 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 đž
Cargado Raises $3M in Pre-Seed Funding. Cargado aims to create a tailored software platform for US-Mexico cross-border logistics. The funding will be used to build the initial team, technology, and launch the product with a select group of beta users. The round was led by Ty Findley, co-founder at Ironspring Ventures, with participation from Zenda Capital, Nichole Wischoff of Wischoff Ventures, Proeza Ventures, and Sahil Bloom, and additional professionals.
Shamba Pride Raises $3.7M in Pre-Series A Funding. Shamba Pride uses its merchant network to enhance last-mile distribution for farm inputs as well as reduce price exploitation and quality issues for farmers. The funding will enable the company to build its franchise network and source agri inputs in bulk. The round was led by EDFI AgriFI â the EU Agriculture Financing Initiative â alongside contributions from Seedstars Africa Ventures.
Bulk Exchange Raises $4.5M in Seed Funding. Bulk Exchange offers a marketplace to enable construction companies and contractors to purchase and dispose of materials in bulk. The capital will be used to accelerate growth and primarily comes from strategic individuals within construction.
Heex Technologies Raises âŹ6M in Funding. Heex Technologies is a Paris-based smart data platform focused on leveraging AI usage in autonomous use cases. The funding will be used to expand beyond the initial focus on AVs and into adjacent industries like Smart Cities and Industry 4.0. Investors include Shift Invest, Karista, and Techstars.
Captura Raises $21.5M in Series A Funding. Captura is a direct ocean carbon capture company that aims to turn it into lower GHG emission fuel. The capital will be used to expand operations and its business reach. The round included investment from Maersk Growth, Eni Next, EDP Ventures, Future Planet Capital, Equinor Ventures, Freeflow Ventures, Hitachi Ventures, Aramco Ventures, mTerra Ventures, and EIC Rose Rock Venture Fund.
Albedo Raises $35M in Series A-1 Funding. Albedo aims to provide commercial orbital imagery satellites for a wide range of use cases including farming and logistics. The latest funding will help it work towards the launch of its first commercial satellite in the first half of 2025. The round was led by Standard Investments and included other investors such as Booz Allen Ventures and Cubit Capital.
Bluewhite Raises $39M in Series C Funding. Bluewhite is a robots-as-a-service platform that enables autonomous operations of tractors. The funding will be invested in R&D to enhance the firmâs service stack as well as its autonomous hardware technology. Leading the round is Insight Partners with participation from new investors Alumni Ventures and LIP Ventures as well as existing backers EntrĂ©e Capital, Jesselson, Peregrine Ventures, and more.
Sion Power Raises $75M in Series A Funding. Sion Power is a Tucson-based company using compression in lithium metal battery for better EV batteries. The capital will be used to achieve technical and market validation of its technology. The round was led by LG Energy Solution.
Monta Raises âŹ80M in Series B Funding. Monta is a software company which handles the app and operations for businesses that run charging stations. The round will enable the firm to expand across Europe and the US. Energize Capital, Denmarkâs Export and Investment Fund, and GreenPoint Partners led the round.
CMA CGM Acquires Wincanton for $700M. CMA GGM is the French shipping giant offering end-to-end transport services and supply chain management. Wincanton is a logistics firm operating in more than 170 warehousing and grocery sites across Britain and Ireland. This deal is a strategic investment for CMA CGM to expand its offering in the UK while building complementary grocery and consumer expertise.
Who's Hiring? đ©âđ»
Be sure to check out the Dynamo website for more job opportunities at our portfolio companies!
Customer Success Specialist at Zeelo in London, UK.
Implementation Specialist at Stord in Atlanta, GA.
Director of Finance at PaintJet in Norfolk, VA.