Dynamo Dispatch (2024/10/07)
Issue 304 | Joby Aviation, Dexory, HungryPanda
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
US ports reopened after dockworkers agreed to end their first major strike in decades, averting further supply chain disruptions and clearing a backlog of over 40 ships. The settlement represents a significant win for the union, although the wage increase falls short of their initial demand. This strike's impact will extend beyond these few days, as increased costs are likely to be passed on to cargo owners and shipping lines. Additionally, discussions about limits on automation remain unresolved. Read on for more details.
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Supply Chain đŠ
â US Dockworkers Head Back to Work, Talks Extended to January. The US dockworkers ended a three-day strike that had halted trade along the East and Gulf Coasts, potentially averting a significant economic disruption. The International Longshoremenâs Association (ILA) and the US Maritime Alliance (USMX) agreed to extend their contract until January 15, allowing for further negotiations on a long-term deal, which currently includes a 62% wage increase. The brief strike raised concerns about its economic impact, with estimates suggesting losses between $3B to $5B per day. Lingering issues, such as automation in port operations, remain to be addressed in future talks. Looking ahead, US Ports Start 100-Day Countdown Clock to New Strike, and Automation is Poised to be the Dealbreaker and Debunking ILA Dockworkersâ Claims About Carrier Price Gouging.
Factory Workers Are Dying Because Machines Arenât Being Turned Off. Hundreds of US factory workers have died over the past decade in accidents involving machinery that could have been prevented by following the "lockout/tagout" safety regulation that requires machines to be powered down during maintenance. The regulation is designed to prevent unexpected machine restarts, yet violations are common in industries where productivity pressures often outweigh safety concerns. Companies sometimes use alternatives that allow machines to stay powered, which can lead to tragic consequences, as seen in multiple cases where workers were killed or seriously injured. Despite these incidents, legal and regulatory challenges persist, with debates over how best to protect workers while balancing operational demands.
âDown For the Foreseeable Futureâ: Truckers Grapple with Hurricane Heleneâs Aftermath. Hurricane Helene devastated the Southeastern US, killing over 100 people, leaving millions without power, and washing out major highways crucial for aid delivery. In North Carolina, key trucking routes are impassable, creating severe disruptions of the supply chain and compounding challenges for the trucking industry. Bottled water shipments have become a priority as water treatment facilities remain offline, while widespread road closures and power outages have halted operations for many carriers. Despite the damage, experts do not expect a significant long-term boost to freight rates, with only localized increases anticipated. Also, Hurricane Helene to Tighten Truckload Capacity Beyond US Southeast.
Second Regional NLRB Office Rules Amazon, Delivery Service Partners Employ Drivers Jointly. A recent decision by the National Labor Relations Board (NLRB) has declared Amazon and one of its Delivery Service Partners (DSPs) as joint employers, a move with significant implications for Amazonâs labor practices. This ruling follows a similar finding in California, challenging Amazonâs claim that DSP workers are solely employees of the DSPs. The NLRB found that Amazon exerted sufficient control over key employment conditions to be considered a joint employer, particularly in cases involving unionization efforts. The decision could disrupt the current legal structure of Amazonâs relationship with DSPs and may affect how Amazon handles labor relations and unionization across its logistics network. For more on labor, Amazon Warehouse Employees in SF Join Teamsters Union, Demand Voluntary Recognition and Flexport Reorganizes Fulfillment Division, Cuts 2% of Staff.
This Garment Maker Is Finding New York Manufacturing Is Back in Style. Ferrara Manufacturing, a garment factory in Queens, is experiencing a resurgence in demand for US-made apparel as brands seek to bolster supply chain reliability and meet consumer demand for domestic goods. The company, which had shifted focus to producing US military uniforms as many apparel brands moved production overseas, is now signing private-label contracts with luxury and workwear brands. This trend is part of a broader push by companies to nearshore production and reduce reliance on foreign supply chains, especially in light of pandemic-related disruptions. Ferrara Manufacturing is investing in automation and expanding its factory to meet growing demand, positioning itself as a stable alternative to overseas production despite higher labor costs. Unrelated, Silicon Valley is Getting a New Treat: Drone Delivery.
Mobility đ
â Chinaâs Drive for Global EV Dominance and the Roadblocks Itâs Facing, in Charts. Chinese EVs makers are facing increasing barriers to exporting their vehicles due to new tariffs and restrictions imposed by several countries. The European Union voted to impose tariffs of up to 45% on Chinese-made EVs, while countries like Brazil, Turkey, and Canada have also raised import duties, significantly affecting Chinese EV exports. In response, Chinese manufacturers are looking to build factories outside of China, such as BYD's planned factory in Turkey. These protective measures have slowed China's EV export growth, particularly in key markets like the EU and Brazil. Related, EU Leaders Back Extra Chinese EV Tariffs Despite Split Vote and As EU Targets Chinese Cars, European Rivals Sputter.
Auto Sales Are Idling as Prices Remain High. US vehicle sales in the third quarter of 2024 fell 1.9% compared to last year, with General Motors and Toyota reporting notable declines due to factors such as high vehicle prices and borrowing costs. The average price of a new vehicle, though slightly lower than last year, remains high at $44,467, a substantial increase from pre-pandemic levels. Disruptions from Hurricane Helene and a dockworker strike further affected sales, with automakers concerned about long-term economic impacts. Consumers are shifting towards more affordable smaller vehicles, with leasing becoming a more popular option as new-car finance payments remain elevated. For more, Biggest Winners and Losers in Auto Sales in Q3 2024.
Toyota Maps Out When Its ICE Age Will End in America. The EV market is facing setbacks with automakers scaling back sales targets, delaying new products, and struggling with battery costs, leading some to shift focus back to hybrids. Toyota, which has continued to push hybrids despite predictions that they would be phased out, has seen electrified vehicles grow to nearly half of its US sales, compared to just 20% two years ago. Toyotaâs chief scientist, Gill Pratt, highlights the challenges of rapid EV adoption, stressing that wishful thinking about a smooth transition has been unrealistic. Toyota is pressing ahead with a $13.9B battery factory and is optimistic about renewable energy advances but urges a pragmatic approach to decarbonization efforts. Also in Toyota news, Toyota Bets $1 Billion On Flying Taxis; Joby Aviation Reverses Lower and Toyota and Subaru to Jointly Develop EV for 2026 Launch.
Stellantis US Auto Sales Extend Free Fall in Third Quarter. Stellantis' US vehicle sales continued to decline sharply in the third quarter, with a 19.8% drop compared to the same period last year and an 11.5% fall from the previous quarter. CEO Carlos Tavares acknowledged past mistakes in US operations including issues with inventory, manufacturing, and market strategy, but noted some progress, such as a slight increase in market share and a reduction in vehicle inventory. All of the company's brands, except Fiat, experienced sales declines, with Chrysler and Dodge seeing the largest drops. Stellantis has faced further challenges, including a lowered 2024 profit forecast and a recall due to fire risks in its plug-in hybrid Jeep models. Also, Stellantis Files Federal Lawsuit Against UAW After Local Strike Vote, With More Planned.
Why Auto Industry Woes are Dragging Down Chip Stocks. The semiconductor sector faced significant losses, with Nvidia losing nearly $110B in market cap. This volatility is common in the semiconductor industry, with automotive sector weakness being a major factor behind the recent downturn as autos account for 10-15% of the sector. Despite recent declines, AI-related demand, led by companies like Nvidia, AMD, and Broadcom, has been a strong growth driver, with AI now accounting for 30% of the sector.
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
Senvo Raises âŹ2.5M in Venture Funding. Senvo is a Germany-based provider of a spend visibility and reconciliation tool that enables large shippers to reduce shipping costs. The funding will be used to accelerate product development. Defy.vc and Two Ravens led the round with participation from Fund F.
Paren Raises $3M in Venture Funding. Paren helps companies and organizations optimize EV charging and fleet management. The funding will be used to scale its current data platform and build new services on top of it. Base10 Partners led the round, with participation from Founders Network Fund and Luc Vincent.
Foodforecast Raises âŹ3M in Seed Funding. Foodforecast aims to optimize the food supply chain through an AI-driven sales forecasting solution. The funding will fuel expansion across Europe and scaling of operations. The round was led by Scalehouse Capital and Future Food Fund II, with support from existing investors Blue Horizon Ventures and Aeronaut Invest.
Permanent Agriculture Raises $3.7M in Seed Funding. Permanent Agriculture is a wholesale food marketplace and distributor. The capital will be used to hire team members across sales and technology. Better Tomorrow Ventures led the round, with participation from Atman Capital, Autopilot, Gaingels, Progression, Sugar Mountain, and other investors.
Ameba Raises $7M in Seed Funding. Ameba uses AI to analyze supply chain data from various sources, helping retailers predict disruptions and address bottlenecks in their global supply chains. The company claims it can reduce manual data input by 30%. Hedosophia led the round and was joined by Visionaries Club and Anamcara Capital.
DocJuris Raises $8M in Series A Funding. DocJuris offers an AI-driven contract management solution for departments such as procurement within businesses. The round will enable the company to further enhance its platform. Silverton Partners led the round, with participation from Watertower Ventures, Surface Ventures, and Seed Round Capital.
Salient Motion Raises $12M in Pre-Seed and Seed Funding. Salient Motion is an aerospace and defense supplier of critical motion control components. Cantos Ventures led the funding, with participation from Andreessen Horowitz, AE Ventures, Hummingbird Ventures, and BoxGroup.
Voliro Raises $12M in Series A Funding. Voliro designs advanced flying robots used for industrial inspections and maintenance tasks in difficult-to-reach areas. Cherry Ventures led the round.
Anaphite Raises $13.7M in Series A Funding. Anaphite has developed an electrode dry coating technology for battery manufacturing which lowers the cost of battery production and associated emissions. The funding comes from World Fund and Maniv.
Valdera Raises $15M in Series A Funding. Valdera is an AI-driven sourcing platform for chemicals and raw materials. Index Ventures led the round, with participation from Susa Ventures, Lerer Hippeau, and Box Group.
Pallet Raises $18M in Series A Funding. Pallet is an all-in-one transportation and WMS that uses AI to help businesses streamline operations from order entry to dispatching drivers, managing inventory, and accounting. Bain Capital Ventures led the round, with participation from Bessemer Venture Partners and Activant Capital.
Bot Auto Raises $20M in Pre-A Funding. Bot Auto is an AV trucking company operating a TaaS business model. The funding will be used to fuel the tech development. Investors include Brightway Future Capital, Cherubic Ventures, EnvisionX Capital, First Star Ventures, Linear Capital, M31 Capital, Taihill Venture, Uphonest Capital, and Welight Capital.
Numa Raises $32M in Series B Funding. Numa provides AI-powered automation tech for car dealerships. The funding will be used to expand the AI engineering team and accelerate product development. Touring Capital and Mitsui led the round and were joined by Costanoa Ventures, Threshold Ventures, and Gradient.
Utility Global Raises $53M in Series C Funding. Utility Global converts and concentrates streams of hydrogen and syngas from industrial waste gases to a cleaner, more efficient alternative. The funding will be used to accelerate commercialization and go-to-market strategies for its first commercial units. OPG Pension Plan led the round, with participation from XCarb Innovation Fund, Ara Partners, and Aramco Ventures.
HungryPanda Raises $55M in Funding. HungryPanda is an asian-food focused delivery platform. The funding will be used to expand into new categories like groceries and focus on AI and ML to optimize operations. Mars Growth Fund led the round, with previous investors Perwyn, Kinnevik, 83North, and Felix also participating.
Dexory Raises $80M in Series B Funding. Dexory builds ultra-tall robots which help warehouses efficiently inventory goods. The funding comes from Latitude Ventures, Wave-X and Bootstrap Europe, along with existing backers Atomico, Lakestar, and Capnamic.
Joby Aviation Raises $500M in Funding. Joby Aviation is developing electric air taxis. The funding will be used to complete the Type 2 certification process with the FAA and support commercial production of its electrical vertical takeoff and landing aircraft. Toyota led the round.
Who's Hiring? đ©âđ»
Be sure to check out the Dynamo website for more job opportunities at our portfolio companies!
Founding Software Engineer at Importal in Austin, TX.
Chief of Staff at Solvento in Mexico City, MX.
NPI Engineer at Gatik AI in Mountain View, CA.