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Korean Air Buys Boeing Jets; Factory Robots Find New Jobs, Limits; China Sets Rare-Earths Rules

By Mark R. Long

 

President Trump spoke with South Korean President Lee Jae Myung in the Oval Office on Monday.  PHOTO: MANDEL NGAN / AFP via Getty Images

Boeing plans to sell 103 airplanes to Korean Air in what would be the aerospace giant’s biggest-ever wide-body order from an Asia-based carrier.

The deal, signed at a U.S.-South Korea roundtable in Washington, came the same day that President Trump met with his South Korean counterpart, Lee Jae Myung, at the White House. Korean Air’s total orders from Boeing will reach 175 once Monday’s deal is completed. After their meeting, Trump said his administration and Seoul were set to finalize the details of their previously announced trade deal.

That agreement would reduce U.S. tariffs on Korean goods to 15% from 25% in return for broad tariff reductions and $350 billion of investment commitments, the details of which have yet to be specified. A key sweetener in that agreement was South Korea’s pledge to invest $150 billion to help the U.S. revive its withered shipbuilding industry. President Lee is today scheduled to visit Hanwha Philly Shipyard, which was acquired last year by South Korea’s Hanwha Ocean for about $100 million.

  • The U.S. will increase tariffs and impose export restrictions on countries that tax or regulate American tech firms, Trump said late Monday. (WSJ)
  • A senior Chinese trade negotiator will visit Washington this week for talks, marking the first round of negotiations in the U.S. capital. (WSJ)
  • A White House spokesman clarified that a probe into furniture imports Trump mentioned Friday is part of a continuing investigation into imports of timber, lumber and their derivative products announced on March 1. (WSJ)
  • A draft notice published Monday outlines the Trump administration’s plans to impose a 50% tariff on imports from India. (Bloomberg)
 
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Factory Automation

Car-welding robots at work in the Hyundai plant in Georgia. PHOTO: ANNA OTTUM FOR WSJ

Humans are sparse in much of Hyundai Motor’s ultramodern new plant in Georgia, which opened late last year and illustrates advanced manufacturing’s evolving balance between humans and machines.

The plant deploys 750 robots alongside about 1,450 human workers. That roughly 2-to1 ratio compares with an auto-industry average of 7-to-1, the Journal’s John Keilman writes, a sign of the rapid influx of robotic technology into manufacturing. The plant features robotic dogs and Hyundai plans to deploy humanoid robots. Some incoming workers wonder how long they will be able to keep their jobs. Some industry watchers say they are right to be concerned.

A robot takeover is decades away, though, according to a government-funded nonprofit working to strengthen U.S. manufacturing. Robots struggle with too many tasks and performing the most complex of them will require breakthroughs that aren’t yet on the radar, it says.

 

Quotable

“The minute humans become more expensive, more recalcitrant, the more automation you’re going to get.”

— Salem Elzway, a postdoctoral fellow at Vanderbilt University
 
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Critical Materials

A rare-earth mine in China's Jiangxi province. PHOTO: CHINATOPIX VIA AP

Chinese authorities tightened control over the mining, smelting and separation activities of rare earths used in many high-tech products, extending regulations to imported minerals.

The Dow Jones Risk Journal’s Anwar Faruqi writes that the interim rules require rare-earths producers to keep accurate records of product flows, upload the data to a government tracing system, and operate strictly within approved quota limits.

China supplies around 90% of the world’s rare earths. Earlier this year, as U.S.-China trade tensions ratcheted up, Beijing tightened rare-earth export controls. Beijing allowed them to start flowing after the Trump administration agreed to a tariff truce in June.

 

Number of the Day

4.5 Million

Containership capacity, in 20-foot-equivalent units, required to be scrapped by 2030 to balance a boom in orders for new ships, according to Linerlytica
 

 

In Other News

German business confidence improved slightly in August, with the Ifo business-climate index rising to 89.0 from 88.6 in July. (WSJ)

The Texas Manufacturing Outlook Survey’s index for general business activity fell to minus 1.8 in August– suggesting contraction–from 0.9 in July. (WSJ)

Dillard’s and a partner purchased the Longview Mall in Texas for $34 million, even as other department stores unload properties as fast as they can. (WSJ)

The U.S. government ordered Orsted to stop work on the 80%-complete Revolution Wind project off Rhode Island. (WSJ)

Temu’s Chinese owner, PDD Holdings, posted a smaller-than-expected 3.9% profit decline despite revenue growth slowing. (WSJ)

Chinese car giant Dongfeng Motor plans to delist from Hong Kong and spin off its electric-vehicle arm as an independent listed company. (WSJ)

Australian PPE maker Ansell will continue to make most of its products in Asia and is unlikely to invest in increased U.S.manufacturing. (WSJ)

Warren Buffett said Berkshire Hathaway, which owns BNSF Railway, isn’t in the market to buy another railroad, though he met CSX’s CEO  and discussed cooperating to make freight rail more efficient. (CNBC).

Labor groups and lawmakers oppose a U.S. railroad-industry plan to increase the use of automation in routine track-safety inspections. (Reuters)

A truck driver from India accused of making an illegal U-turn that killed three people in Florida was denied bond on three state counts of vehicular homicide and immigration violations. (Associated Press)

At least 3,000 truckers have been removed from U.S. roads over the past two months after they failed roadside English-proficiency tests. (USA Today)

Taiwan Semiconductor Manufacturing is cutting Chinese-made equipment from its most advanced chip plants to avoid any potential U.S. restrictions. (Nikkei Asia)

An A.P. Moeller-Maersk containership is reportedly safely back underway with no visible damage after firefighting teams contained a fire burning for nearly two weeks off the coast of Africa. (The Maritime Executive)

The U.S. Coast Guard last week arrested the captain of a Mediterranean Shipping containership for allegedly operating the vessel near Seattle while intoxicated. (KOMO)

 

About Us

Mark R. Long is editor of WSJ Logistics Report. Reach him at mark.long@wsj.com. Follow the WSJ Logistics Report team on LinkedIn: Mark R. Long, Liz Young and Paul Berger.

 
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