May 17, 2020

Obama's State of the Union alludes to more jobs in the supply chain

Freddie Pierce
3 min
The topic of supply chain risk management continues to be discussed, with U.S. President Barack Obama stepping in to offer his thoughts on the subject
If you watched the State of the Union Address last night or read the transcript on NPR today, then its likely that you already have an opinion about Pre...
If you watched the State of the Union Address last night or read the transcript on NPR today, then it’s likely that you already have an opinion about President Barack Obama’s message. I should let you know now that I have no intentions of either reaffirming that opinion or refuting it. If you are looking for fanatical commentary to spin Obama’s message into a certain political affiliation, then you are definitely in the wrong space.

Instead of making this about political allegiance, I would rather discuss how it seems that Obama’s vision for the future of the United States includes a boost in jobs relating to the supply chain industry. Let me explain.

Obama suggested that for the US to “win the future” it will be in three areas: education, clean technology, and infrastructure. America’s success will come from its ability to create productive jobs in these industries. It's no surprise that Obama would highlight education and clean technology because those are staples that hold together any great State of the Union address. It was the part about infrastructure that Obama alluded to last night that was the real surprise to me. American needs infrastructure improvements that will yield the “fastest, most reliable ways to move people, goods and information.”

“We have to make America the best place on Earth to do business,” Obama said.

Obama’s point resonated in my mind long after his speech ended last night. Infrastructure and business go hand in hand. Most of the time infrastructure precedes business, but today we see a world where innovations in infrastructure are supplementing well-established businesses. America’s infrastructure used to be the best, Obama said, but the dominance has fallen to nations like China, South Korea and Russia.

“We have to do better. America is the nation that built the transcontinental railroad, brought electricity to rural communities, constructed the Interstate Highway System. The jobs created by these projects didn't just come from laying down track or pavement. They came from businesses that opened near a town's new train station or the new off-ramp.”

Even though he doesn’t say it explicitly it seems to me that Obama is talking about the supply chain of the United States. Infrastructure might be more of a buzz word that the American public can relate to, but ultimately infrastructure supports the movement of goods, or in other words the supply chain. The movement of goods is only as good as the infrastructure that supports it, whether it be the Internet, highways, airports, seaports, etc. Obama wants US infrastructure, the supply chain, to be the best in the world. The supply chain industry is naturally a lead indicator of economic growth because it tracks things like freight volume and total shipping capacity. 

In terms new jobs, Obama laid a plan to double American exports by 2014 because “the more we export, the more jobs we create here at home.” Obama said the US has signed agreements with India and China that will support more than 250,000 jobs in the United States. If a job is export-related, then it's definitely supply chain-related. Supply Chain Digital will be tracking these international deals with a keen eye to give you any updates. The President also said the US finalized a trade agreement with South Korea that will support at least 70,000 American jobs.

Another one of Obama's big messages was about the future of education. Do you think he was possibly talking about one of the colleges that we named in the Top Universities for Supply Chain Management?Also, when Obama was talking about keeping jobs at home rather than abroad, do you think the people working on the Boeing 787 Dreamliner were nodding their heads accordingly? 


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Jun 21, 2021

Elon Musk's Boring Co. planning wider tunnels for freight

2 min
Elon Musk’s tunnelling firm plans underground freight tunnels with shipping containers moved on “battery-powered freight carriers”, according to reports

Elon Musk’s drilling outfit The Boring Company could be shifting its focus towards subterranean freight and logistics solutions, according to reports. 

A Boring Co. pitch deck seen and shared by Bloomberg depicts plans to construct wider tunnels designed to accommodate shipping containers. 

Founded by Tesla CEO Musk in 2016, the company initially stated its mission was to offer safer, faster point-to-point transport for people, particularly in cities plagued by traffic congestion. It also planned longer tunnels to ferry passengers between popular destinations across the US. 

The Boring Co. completed its first commercial project earlier this year in April. The 1.7m tunnel system is designed to move professionals between convention centres in Las Vegas using Tesla EVs. It says the Las Vegas Convention Centre Loop can cut travel time between venues from 45 minutes to just two. 


Boring Co.'s new freight tunnels

The Boring Co.'s new tunnel designs would allow freight to be transported on purpose built platforms, labelled as “battery-powered freight carriers”. The document shows that, though the containers could technically fit within its current 12-foot tunnels, wider tunnels would be more efficient. Designs for a new tunnel, 21 feet in diameter, show that they can comfortably accommodate two containers side-by-side, with a one-foot gap between them.

The Boring Co.’s new drilling machine, dubbed Prufrock, can tunnel at a rate of one mile per week, which is six times faster than its previous machine, and is designed to ‘porpoise’ - mimicking the marine animal by ‘diving’ below ground and reemerging once the tunnel is complete. 

Tesla’s supply chain woes 

Tesla is facing its own supply chain and logistic issues. The EV manufacturer has raised the price of its vehicles, with CEO Musk confirming the incremental hike was a result of “major supply chain pressure”. Musk replied to a disgruntled Twitter user, confused as to why prices were rising while features were being removed from the cars, saying the “raw materials especially” were a big issue. 

Elon Musk Tweet

Car manufacturing continues to be one of the industries hit hardest by a global shortage in semiconductor chips. While China’s chip manufacturing levels hit an all-time high in May, and the US is proposing a 25% tax credit for chip manufacturers, demand still outstrips supply. Automakers including Volkswagen and Audi have again said they expect reduced vehicle output in the next quarter due to a lack of semiconductors, with more factory downtime likely

Top Image credit: The Boring Company / @boringcompany

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