Dynamo Dispatch (2025/06/02)
Issue 333 | E2open, Pallet, Rivan
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Weekly Commentary š
This weekās headlines reflect continued instability across global supply chains, as tariff policy whiplash continues to disrupt planning and pricing. A US appeals court reinstated the Trump administrationās tariffs, while Chinaās rare earth dominance and new export controls underscore the Westās vulnerability in critical materials. Meanwhile, companies from Hyundai to Gap are adjusting strategies in response, and rail and ocean carriers are planning for volatility ahead.
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ā Trump's Tariffs to Remain in Effect After Appeals Court Grants Stay. As of the time of writing, a US federal appeals court has temporarily reinstated President Trumpās tariffs after a lower trade court ruled they exceeded presidential authority under the International Emergency Economic Powers Act (IEEPA). The Trump administration argued that maintaining the tariffs was vital for national security and is now exploring alternative legal pathways, including provisions of the 1974 Trade Act, to reimpose tariffs with a stronger legal basis. The back and forth has only added additional uncertainty and complexity for importers, exporters, and beyond. For additional context, Trade Court Strikes Down Trumpās Global Tariffs.
Chinaās Rare Earth Grip Tightens as Western Diversification Falls Short. China continues to dominate rare earth supply chains, controlling 69% of global production in 2024 and nearly half of the worldās reserves. Despite Western efforts to diversifyāsuch as U.S. investments in recycling and Japanās innovation to reduce dependencyāalternatives remain limited and slow to scale. Recycling is still energy-intensive and inefficient. Recent Chinese export controls on key rare earths like terbium and cerium have heightened supply risks for industries from EVs to defense. While some export licenses were issued, approvals remain inconsistent. The West urgently needs resilient supply strategies as China tightens its grip on materials critical to clean energy and manufacturing. Related, US-China Trade Tensions Escalate Over Rare-Earth Exports.
Gap Inc. Braces for $300M in Tariff Costs While Holding Prices Steady. Gap Inc. is facing $250ā$300M in additional tariff-driven costs this year, with an expected $100ā$150M hit to operating income after mitigation efforts. Despite this, the company plans to maintain current pricing across its brands, even as trade policy remains volatile. Executives emphasized supply chain adjustments, efficiency gains, and cautious optimism, while analysts warned tariffs could dampen second-half momentum. Management is focused on protecting margins without alienating consumers through price hikes. Related, Retailers are Grappling with Whether to Pass Tariff Costs Onto Customers.
Hyundai Weighs Sweeping US Price Hikes to Blunt Tariffs. Hyundai is planning to raise prices on all new US vehicles by about 1% and increase fees for shipping and pre-installed options to offset the impact of President Trumpās tariffs, according to sources familiar with the matter. The price hike would apply only to newly built vehicles and not to those already on dealership lots, and Hyundai emphasized that the strategy is part of its regular pricing review, though final decisions are still pending. Despite significant US manufacturing investments, Hyundai remains one of the largest importers of vehicles into the country and joins other automakers like Ford and Subaru in adjusting prices in response to tariff-related cost pressures. Elsewhere, Volvo Cars to Slash 3,000 Workers Amid Global Trade Uncertainty.
BNSF Prepares for Container Surge. BNSF is preparing for a surge in import volumes following the recent US-China tariff pause. The company expects activity to ramp up post-Fourth of July, noting early signs of recovery such as full vessel utilization and increased traffic build-up on the West Coast. Despite limited signs of nearshoring to North America, BNSF sees steady movement from Asia, stable rail flows, and a balanced supply chain, with low dwell times indicating readiness for higher freight volumes in the months ahead. Completely unrelated, Congress, States Join DOT Targeting Non-English-Speaking Truckers and Supreme Court Rules in Favor of Utah Crude Oil Railway.
Ocean Carriers Bring in More Trans-Pacific Container Services Amid Rate Surge. Maersk and Hapag-Lloyd are launching a new trans-Pacific express service from China and South Korea to Long Beach, CA, starting June 24, while MSC plans to restart its suspended East Coast Empire service amid rising demand. The moves come as trans-Pacific shipping rebounds sharply following a 90-day tariff reprieve, with spot freight rates from China to the US West Coast nearly doubling since April. Container ship capacity from Asia to the West Coast is expected to hit a seven-month high in June, although some carriers may not restore capacity until July due to prior vessel reassignments. Completely unrelated, Plastic Waste Drifts Ashore After MSC Boxship Sinks.
53% of Manufacturers Adopting Industrial Robots to Improve Quality. ABI Research reports that 53% of manufacturers are deploying industrial robots to enhance quality control, with 28% already using them and 40% identifying quality as the top driver. This marks a shift from using robotics solely for productivity to focusing on precision and compliance. While lack of expertise and implementation time remain barriers, the trend is accelerating. Collaborative robots ("cobots") are also gaining traction among SMEs for tasks requiring accuracy and adaptability. These developments point to growing reliance on automation to meet stricter quality standards. Related, Humanoid Robots Spark Debate About Safety, Form and Function.
General Motors Invests $888M in New York Plant for Next-Gen V-8 Engines. General Motors is shelving its planned $300M investment in EV motor production at its Tonawanda plant and redirecting $888M toward building sixth generation V8 engines. The move comes amid a broader industry recalibration as EV sales underperform forecasts. This marks GMās largest-ever investment in an engine plant and reinforces its dual-path strategy across combustion and electric platforms. The new engines, designed for full-size trucks and SUVs, aim to improve performance and lower emissions. Production will begin in 2027, alongside ongoing fifth generation output, with significant upgrades to equipment and manufacturing infrastructure. Related, Volkswagen Plans Major US Investment to Circumvent Tariffs.
US Pharmaceutical Supply Chain Faces Ongoing Crisis. At an Axios roundtable event, experts highlighted that the US pharmaceutical supply chain is in a prolonged crisis, largely due to heavy reliance on foreign nations like China for essential medical supplies. Allan Coukell of Civica Inc. emphasized that the crisis has persisted for 14 years, driven by policy incentives encouraging offshore production. Mark Ey of the National Community Pharmacists Association echoed this concern, pointing to complex market dynamics and manufacturing disruptions that have led to long-term shortages of critical medications. These shortages pose economic, public health, and national security risks. Related, Pharma Shipments Surge Due to Trump Tariffs.
The Future of Supply Chain šļø
Check out our podcast series thatās 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 šø
Way Data Technologies Raises ā¬2.6M in Pre-Seed Funding. Way Data Technologies offers a flexible fleet management platform that consolidates data from vehicles and IoT devices to support electrification planning, emissions reporting, and AI-driven optimization. The funding will be used to launch the Way Platform. The round was led by Pale Blue Dot, with participation from 10x Founders, Greens Ventures, and angel investors including Laura Modiano (Head of Startups EMEA at OpenAI).
PiLogic Raises $4M in Seed Funding. PiLogic specializes in high precision, expert-guided AI for aerospace & defense applications. The funding will enable team expansion and further product development. Scout Ventures and Seraphim Space led the round, with participation from Sovereignās Capital, Flex Capital, FN Fund and angel investor Gokul Rajaram.
Sention Technologies Raises ā¬4.3M in Seed Funding. Sention Technologies offers next-gen battery diagnostic tools. The funding will enable commercialization acceleration, R&D investment, and international customer acquisition. The round was led by Twin Path Ventures, with participation from Doral Energy-Tech Ventures, Endgame Capital, Energy Revolution Ventures, G.K. Goh Ventures, Green Angel Ventures, Third Sphere, and the UK Innovation and Science Seed Fund.
New Generation Raises $4.5M in Seed Funding. New Generation builds AI-friendly digital storefronts that convert product catalogs into formats optimized for use by AI agents and virtual assistants. The funding will support product development and go-to-market efforts aimed at helping brands future-proof for agentic commerce. Investors were not disclosed.
RoboForce Raises $5M in Funding. RoboForce is building an AI robot for demanding jobs within industrial outdoor environments. The funding will help fuel team expansion across AI and robotics.
Alrik Raises ā¬7M in Funding. Alrik is building a construction logistics operating system, connecting suppliers, merchants, carriers, truck drivers and construction sites. The new funding will be used to further develop Alrikās product and go-to-market strategy. Nordive VC People Ventures led the round, and was joined by Pi Labs.
Rivan Raises Ā£10M in Funding. Rivan is developing synthetic fuel technology, specifically modular synthetic fuel plants powered by off-grid solar energy, to enable industrial decarbonization. Plural led the round, with participation from 20VC and NFDG.
Pallet Raises $27M in Series B Funding. Pallet automates logistics workflows such as order entry and quoting through its AI-powered platform, CoPallet. The Series B funding will support Palletās efforts to scale its AI infrastructure and continue building what General Catalyst called a ānew operating system for the logistics industry.ā The round was led by General Catalyst, with participation from Bain Capital Ventures, Activant Capital and Bessemer Venture Partners.
Misfits Market Acquires The Rounds. Misfits Market is a food delivery platform which collects & distributes imperfect groceries that would have otherwise gone to waste. The Round is a household restocking service with reusable packaging. The acquisition enables Misfits Markets to diversify into additional categories, such as cleaning supplies and paper products.
WiseTech Acquires E2open for $2.1B. WiseTech Global is an Australian logistics software giant focused on end-to-end supply chain visibility and automation. It is acquiring E2open, a US-based supply chain execution software provider with over 400,000 connected enterprise users. The acquisition is aimed at consolidating fragmented logistics platforms into a single global operating system.
Who's Hiring? š©āš»
Be sure to check out the Dynamo website for more job opportunities at our portfolio companies!
Quality Assurance Intern at Plus One Robotics in San Antonio, TX.
Insurance Producer at LogRock in Concord, NC (Remote)
Integrations Engineer at Stord in Atlanta, GA (Remote).