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Tariffs in Post-Election Spotlight; Suppliers Furnishing Wayfair Sales By Paul Page
Companies that depend on global trade are bracing for a wave of new tariffs under a second Trump administration. An aggressive set of levies promised by President-elect Trump could reset the flow of goods around the world, effectively reshaping global supply chains as retailers, manufacturers and shipping companies weigh a changed economic landscape.
The WSJ Logistics Report's Liz Young writes that the tariffs would likely have a significant impact on American importers and on exporters who may find their access to overseas markets complicated by a regime of tit-for-tat levies. The broad outlines may follow the patterns that Trump established in his first administration, which was marked by a trade war with China and hefty tariffs even on traditional trading partners.
But Trump has signaled he'd go further this time, with talk of tariffs on all imports and big levies of some 60% on imports from China. The impact in the coming months is likely to be a scramble by U.S. importers to pull forward orders from overseas before tariffs kick in, a rush that shipping industry officials say would eat up shipping capacity and drive up freight rates.
Longer-term, that may accelerate nearshoring strategies and likely raise the costs of goods. The effects may reach well beyond the U.S. market.
Shares in apparel companies fell as investors digested the impact of potential tariff increases on companies that source and manufacture their goods abroad. (WSJ) Donald Trump's opposition to the CHIPS Act leaves U.S. factory plans for Samsung and Taiwan Semiconductor Manufacturing uncertain. (Nikkei Asia) CONTENT FROM: PENSKE LOGISTICS Gain X-Ray Vision. Gain Ground with Penske Logistics.
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Wayfair is leaning on its suppliers to help bring in customers. The online furniture retailer has been churning out deals on desks, couches and more this year without any big hit to its profit margins. The WSJ's Jennifer Williams reports that is because Wayfair, which doesn't hold much inventory, has suppliers cover nearly all of the costs tied to a promotion. Wayfair's home furnishings sector has stumbled since the pandemic, as shifting consumer demand has hit sales, particularly e-commerce business. Furniture and home furnishing sales were down 5.1% in the first nine months of this year, according to the Commerce Department. Wayfair has some 20,000 manufacturers and distributors in its network. CFO Kate Gulliver says that as the company rolls out promotions to boost sales volumes, it's turning to those suppliers to fund the reduction in their wholesale prices, which Wayfair then passes on through discounts and price adjustments.
Number of the Day In Other News
German manufacturing orders jumped a more-than-expected 4.2% from August to September. (WSJ)
Schneider National cut its profit guidance after results from its network trucking business dragged down revenue in the third quarter. (WSJ)
Boeing supplier Spirit AeroSystems warned it has substantial doubts about its ability to continue operating. (WSJ)
Toyota cut its annual sales outlook after second-quarter profit fell by more than half. (WSJ)
Profitability in BMW's key automotive unit fell sharply. (WSJ)
A.P. Moller-Maersk says three-quarters of European shippers suffered supply-chain disruptions that affected their operations in the last 12 months. (Port Technology)
Germany's Hapag-Lloyd ordered 24 midsize containerships with liquefied natural gas dual-fuel capability. (TradeWinds)
China's Cosco Shipping is preparing to open its partly complete container at Peru's Port of Chancay. (Maritime Executive)
Walmart sharply cut back its Christmas imports this year to avoid being stuck with excess inventory. (Reuters)
Several containerships are offshore waiting out the labor lockout at British Columbia ports in hopes of a speedy resolution. (Journal of Commerce)
Canadian National halted rail service to terminals hit by a strike at the Port of Montreal. (The Loadstar)
Nikola sold 88 of its hydrogen-electric trucks in the third quarter, a 22% increase over the second quarter. (FleetOwner)
FedEx opened a 1.3 million-square-foot, four-story sorting facility at the carrier's Memphis International Airport hub. (Logistics Management)
Prologis says average U.S. warehouse rents declined by 3% in the third quarter. (Logistics Management)
About Us
Paul Page is editor of WSJ Logistics Report. Reach him at [paul.page@wsj.com].
Follow the WSJ Logistics Report team: @PaulPage , @bylizyoung and @pdberger . Follow the WSJ Logistics Report on X at @WSJLogistics .
This article is a text version of a Wall Street Journal newsletter published earlier today.
(END) Dow Jones Newswires
November 07, 2024 07:05 ET (12:05 GMT)
Copyright (c) 2024 Dow Jones & Company, Inc.
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