The joint strikes launched by the United States and Israel on Iran over the weekend, in an initiative geared halting Iran’s development of nuclear weapons, are expected to bring about various logistics- and supply chain-related issues on various fronts, according to industry observers. Those issues include things such as the likelihood of higher energy prices, restricted shipping lanes in and around the Middle East, as well as the most recent example in what could be viewed as an ongoing series of heightened global logistics challenges, or concerns, among others. Bruce Chan, Managing Director, at investment firm Stifel, observed in a research note that perhaps the biggest takeaway of this development is that the conflict has caused a shuttering of the Straight of Hormuz “and a prolonging effect of reduced Suez Canal and Red Sea shipping traffic.” Which, in turn, reduced recent signs that Red Sea shipping traffic, that, going back to late 2023, when an ongoing series of attacks on the Red Sea shipping lane by the Yemeni Houthi pirates in response to the ongoing Israel-Palestine conflict took hold, had started to show signs of a return to more normalized operations. Prior to the late 2023 attacks, the Red Sea/Suez Canal shipping route saw 10%-to-15% of global maritime trade moving through it, according to industry estimates. In terms of ocean cargo operations, Chan explained that the conflict could curtail global fleet capacity and also keep ocean container rates elevated for longer, adding that in the aftermath of these strikes on Iran by the U.S. and Israel have seen container shipping lines suspend transit through the Strait of Hormuz—representing around 2% of the global ocean container fleet. “Increased uncertainty from geopolitical conflict presents a broad risk to demand, especially if fuel prices increase substantially enough to affect consumer discretionary expenditures,” wrote Chan. Daniel Moore, Baird & Co. analyst, noted that the ostensible closing of the Straight of Hormuz is viewed as “especially critical because around 20% of global petroleum liquids consumption and roughly one-third of globally traded seaborne crude oil, which is equivalent to 17 million-to-20 million barrels per day move through it, adding that 90% of Saudi Arabia’s oil exports flow through the Strait of Hormuz. As for the nations most impacted by this conflict, Moore cited the following: India imports around 85% of its oil needs, approximately 60% of which comes from the Gulf; China sources around 40% of its oil needs via the Strait of Hormuz, which is especially significant given its reliance on Venezuela, which is now effectively controlled by the U.S; and it is reasonable to expect meaningful consequences for Japan, which imports 90% of its oil needs, approximately 60%-70% of which comes from the Gulf region. “The most immediate consequence of these developments is higher energy prices,” wrote Moore. “However, the impact is unlikely to stop there. Disruption to maritime corridors will likely push container rates incrementally higher in some lanes as transit times lengthen and insurance premiums rise. At the same time, shippers seeking to mitigate delay risk may shift incremental volume to air cargo, increasing demand for lift capacity, which is likely to place upward pressure on airfreight rates across much of the region. We expect the direct economic impact on U.S. and European markets to be more limited.” Commentary from Peter Sand, chief analyst, for global freight intelligence platform Xeneta, observed that repercussions of this conflict will see what he described as the further weaponization of trade and also shatter hopes of a largescale return of container shipping to the Red Sea this year. “Carriers had been returning selected east-west ocean container services to transits via Suez Canal in recent months after sailing around Cape of Good Hope since late 2023 due to attacks by Iran-backed Houthi militia in the Red Sea region,” noted Sand. “If Houthi militia resume attacks, as now seems likely, carriers will reverse the decision to return services to the Red Sea and prioritize the safety of crew, ship and cargo. Any plans for a phased return of container shipping to the Red Sea in 2026 will be shelved until the security situation becomes clearer. Carriers are on red alert and we have seen signs of them pre-empting this security deterioration in the Middle East, notably with CMA CGM last month reversing a decision to return its FAL1, FAL3 and MEX to the Red Sea citing ‘the complex and uncertain international context.’” And with a largescale return of container ships to Red Sea in 2026 now unlikely, Sand said that freight rates on major global trades will continue to soften, but will not fall as hard as previously expected in the second half of the year as more services returned to Suez Canal transits. Chris Clowes, associate director at SCALA, a global supply chain and consultancy, said that from a supply chain perspective, the biggest risk of the escalation in the Middle East is wider instability that could affect both energy prices and the routes used to move everyday goods. “Air freight is likely to feel the impact fastest,” said Clowes. “If airlines must avoid certain airspace, capacity falls and flight times increase, pushing up rates quickly, with time-critical goods such as medicines, semiconductors and high-value technology among the most exposed. When it comes to sea freight, which is typically used to transport everything from clothing to consumer electronics, the Suez Canal isn’t formally closed, but if security risks rise, more Asia to Europe services are likely to divert via the Cape of Good Hope. That can add around 10-to -15 days and increase fuel and insurance costs. Longer voyages also tie up ships and containers, which can tighten wider capacity and push up rates beyond the region. Then there is the matter of energy; even partial disruption or perceived risk around the Strait of Hormuz could trigger a rapid rise in oil and liquefied natural gas prices, feeding through into transport, manufacturing and packaging costs in turn.”

Dive Brief:

• Manufacturers are expecting to more than double their use of automation, artificial intelligence and other advanced technologies by 2030, according to an industry outlook from PricewaterhouseCoopers published Friday.
• The U.K.-based professional services firm, also known as PwC, surveyed 443 industrial manufacturing executives around the world for the report. The median share of respondents believe that advanced technology adoption throughout their operations is set to increase from 26% to 68% over the course of five years.
• Two areas with the heaviest use of advanced technology today are production/operations and product design/development, according to the report. Other areas where adoption is relatively low, such as business support functions like finance and human resources, are set to quadruple by the end of the decade.

Dive Insight:

The race is on for manufacturers looking to enable AI and automation across their operations to boost efficiencies or create growth opportunities across the $16 trillion sector, but not everyone is starting from the same place. 

There is a widening gap between the “future-fit” companies and those falling behind due to poor data quality, skills gaps or fragmented systems, Ryan Hawk, global and U.S. industrials and services leader at PwC and author of the manufacturing outlook, said in an email. The gap could grow further as technology and capability advantages build on one another.

“The question is no longer whether companies will adopt new technologies, but how fast they can integrate them,” Hawk said. “As automation becomes ubiquitous, the advantage shifts from who has tools to who can orchestrate them across the enterprise.”

Automation of key business processes, such as data capture and analytics and physical production, is set to boom. According to PwC, adoption of highly automated processes will nearly triple by 2030, extending from the front and back offices to research and development and the shop floor. Survey results show a more even distribution of technology enablement across the value chain, not just in production/operations.

Hawk said this even spread was “most eye-opening.” It signals a fundamental shift toward AI-supported engineering, digital twins and more simulation-driven development, “not just smarter factories,” he said. There’s also growing interest in sensor technologies and physical AI.

As technology enablement and automation surge, manufacturers are looking beyond their core products for ways to generate revenue. They are positioning themselves as providers of “integrated solutions” that combine hardware with software, data, services and technology support, Hawk said. Deere & Co., for example, has been moving beyond equipment toward a digital platform that helps farmers make faster, better decisions.

“Instead of simply shipping equipment, they’re looking to own more of the lifecycle from predictive maintenance to data-driven optimization,” he said. “In many cases, that requires ecosystem collaborations and new capabilities that didn’t sit at the core of the organization five or 10 years ago.”

PwC survey respondents are expecting “fully 44%” of their companies’ total revenue to come from outside of manufacturing industrial or consumer products by 2030. The top three “growth hotspots” are technology, digital and communications products and services; defense, governmental and educational offerings; and energy and fuel production and distribution.

Fostering a strong company culture is also important for manufacturers on their adoption journeys. When leaders are confident about their digital transformation, but their frontline teams do not feel safe or supported in learning new skills, adoption slows, Hawk said.

To bridge the gap, manufacturers need to communicate effectively on how roles will change, invest in upskilling and create environments that encourage experimentation, he said. “Companies that treat workforce readiness as a core pillar of their automation strategy will be far better positioned to turn technology ambition into measurable performance gains.”

This article was written by Nathan Owens from Manufacturing Dive and was legally licensed through the DiveMarketplace by Industry Dive. Please direct all licensing questions to [email protected].

RXO issues updated Curve forecast from Charlotte

Charlotte, N.C.-based full truckload brokerage RXO released the latest edition of its proprietary "Curve" truckload forecast this week. The report noted that spot truckload rates rose both year-over-year and sequentially in the fourth quarter — the first time rates have shown sequential growth in four quarters — and projects further annual and sequential increases in 2026 as carrier capacity tightens relative to shipper demand.

History and structure of the Curve model

The Curve was originally introduced by Coyote Logistics in 2018. Coyote was later acquired by UPS in August 2015 and then sold to RXO in September 2024. RXO describes the Curve as a proprietary forecasting tool that assists shippers and carriers in positioning for varying market conditions.

How the Curve analyzes market cycles

RXO’s model evaluates three overlapping cycles to reveal recurring patterns that can guide logistics decisions:

• Seasonal demand cycles
• Annual procurement cycles
• Market capacity dynamics, which are often harder to quantify

Principal findings highlighted in the report

The Curve’s recent edition emphasized several core observations that underpin its outlook for late 2025 and 2026.

• Spot rates showed both year-over-year and sequential gains in Q4 after a period of sequential softness.
• The jump in spot rates between Q3 and Q4 was substantial — moving from a 1.8% annual gain in Q3 to a 5.2% annual gain in Q4.
• RXO expects 2026 to produce further annual and sequential gains as carrier capacity tightens against shipper demand.
• Volatility may ease somewhat later in the first quarter, but the market is likely to remain in inflationary territory with Q1 ending higher than Q4.
• The report flagged continued carrier exits tied to enforcement of new government rules as a potential upward pressure on rates, while also noting upside signs such as stronger industrial production data and government stimulus.

Insights from RXO’s Corey Klujsza

In an interview with LM, Corey Klujsza, RXO’s vice president of pricing and procurement strategy, said the report’s biggest takeaway is the widening split in rate behavior across the market amid what most view as a soft demand backdrop. He noted that demand remains the primary catalyst for meaningful changes in rate volatility.

Shippers’ forecasts versus carrier signals

Klujsza pointed out a growing disconnect between shipper forecasts and carrier commentary. Many shippers are budgeting and planning for largely flat volumes in 2026, while carriers are signaling conditions that look materially different than a year earlier. He said aligning shipper and carrier perspectives is crucial to keeping freight moving efficiently.

Comparisons to prior cycles and inventory dynamics

Unlike easily explained shifts during the pandemic, when annual changes in goods consumption clarified rate moves, Klujsza said current drivers are more nuanced. He observed potential signs of restocking: inventories were generally lower into 2025, and December showed different inventory behavior. Those inventory adjustments, along with modest changes in consumer behavior and manufacturing orders, could be influencing the observed rate volatility and suggest structural shifts on the supply side.

Causes of the Q4 spot rate surge

The report and Klujsza attributed the near threefold sequential increase in spot rates — from 1.8% in Q3 to 5.2% in Q4 — to a string of capacity-constrained events across 2025. Typical seasonal peaks, short demand surges and episodic supply shocks such as DOT’s Road Check Week combined to tighten available capacity.

Klujsza added that some capacity elected to sit out of the market during those events, and that during constrained periods RXO observed outperformance relative to the prior three years. He described how the market rebounded quickly back to baseline behavior, but that September through November showed upward momentum in annual rates, with December acting as the catalyst that pushed spot rates to the Q4 result.

First quarter outlook and market balance

Looking ahead, the Curve’s first-quarter forecast expects volatility to ease somewhat later in the quarter while remaining inflationary overall, meaning Q1 should finish higher than Q4. The report also warned that additional carrier exits — whether from regulatory enforcement or shifts in demand — could keep upward pressure on rates.

Reasons for cautious optimism

Despite inflationary pressures and structural supply-side changes, RXO identified positives that could temper the market: improving industrial production readings and certain government stimulus measures. These factors provide some optimism even as the industry braces for tighter capacity and evolving demand patterns in 2026.