More Western companies are trying to lower their risks from growing tensions between Washington and Beijing by effectively placing their China businesses in silos. The strategies by companies including automaker Volkswagen and Japanese bathroom product manufacturer Lixil go as far as forging separate supply chains for China that are walled off from the rest of the world. The WSJ’s Elaine Yu and Yoko Kubota report that pharmaceutical giant Merck, for instance, is adjusting its supply chain so that most of the products it makes in China will be for the domestic market, “de-risking” those investments against geopolitical tensions. Analysts warn such strategies carry high costs and may not totally shield companies from losses if a more serious conflict erupts. Lixil says expenses have risen but that many are one-time costs that will put the supplier in a better position if global disruptions occur in the future.

The Prologis logistics-property portfolio is getting bigger. The industrial real-estate giant is buying an array of warehouses owned by Blackstone for $3.1 billion, the WSJ’s Peter Grant reports, adding some 70 sites counting nearly 14 million square feet in major markets across the U.S. The transaction adds to Prologis holdings that already make the real estate investment trust the world’s largest industrial property company and a major force in the logistics sector. Investment heavyweight Blackstone also is a major investor in industrial real estate, with a global portfolio valued at $175 billion, and is continuing to buy warehouses and distribution centers. Demand for industrial space has been stronger in recent years than commercial office space thanks to the boom in e-commerce which has required an overhaul of supply chains. Nearly 60% of the portfolio being acquired from Blackstone by Prologis are properties in cities or close to consumers.

• TikTok struck a series of deals with warehousing and logistics companies to add fulfillment services to its social-commerce business. (The Information)
• Ace Hardware is building a 1.5 million-square-foot distribution center at a growing industrial park near Kansas City International Airport. (WDAF)
• Supermarket chain Trader Joe’s is building a 1 million-square-foot food packaging and distribution center in Palmdale, Calif. (Los Angeles Daily News)

Surging demand for passenger planes is colliding with the aerospace sector’s ability to quickly produce aircraft. A series of large orders at this month’s Paris Air Show signal growing confidence among the world’s airlines that recovering travel demand will continue in a business that was pummeled during the pandemic. But the WSJ’s Andrew Tangel and Benjamin Katz write that jet manufacturers Airbus and Boeing still face constraints on the supply of things such as engines, chips and workers, leaving them both with long and growing order backlogs. Airlines are reserving production slots for aircraft that won’t be delivered for several years. Indian budget carrier IndiGo recently placed a record order for 500 passenger jets, but those aren’t scheduled for delivery until at least 2030. There’s little prospect for improvement: Boeing CEO David Calhoun doesn’t see his company’s supply chain stabilizing until the end of next year.

• Transportation Secretary Pete Buttigieg says flights may be disrupted ahead of a deadline for airlines to retrofit equipment to avoid potential interference from 5G wireless signals. (WSJ)
• Hong Kong’s Cathay Pacific expects to turn its first profit in four years. (Nikkei Asia)

Government mandates for low-carbon trucking fuel aren’t providing the gusher of incentives that producers had expected. Federal regulators are calling volumes of biofuels in the coming years at levels that fall short of industry expectations, the WSJ’s Bob Henderson reports, raising fears the production capacity that companies were scrambling to build up would be left in a lurch. Analysts say the Environmental Protection Agency’s surprisingly modest blending requirements for trucking fuel could upend a raft of projects that were expected to more than double output of renewable diesel. The rules came as a blow to Darling Ingredients, the country’s largest renewable diesel producer, and companies including Archer-Daniels-Midland and Bunge that produce the plant oils and animal fats that go into renewable diesel. The EPA is trying to balance carbon-emission goals with other concerns, such as the impact on food prices of using vegetable oils for fuel.

• Dozens of major shippers, including PepsiCo, Heineken and Nike, are calling on the European Union to set tougher emissions standards for trucks. (Financial Times)

S&P Global’s “flash” manufacturing index for June fell to a six-month low. (MarketWatch)

The Biden administration added suppliers of chemicals, tools and other materials to the list of companies eligible for subsidies aimed at expanding semiconductor production. (WSJ)

Interstate 95 in Philadelphia reopened, less than two weeks after a stretch of the highway collapsed. (WSJ)

Nikola suspects foul play in a fire that broke out behind the electric-vehicle maker’s Phoenix headquarters. (WSJ)

Several cars from a freight train fell into the Yellowstone River in Montana after a bridge collapsed underneath it. (WSJ)

The Teamsters union says United Parcel Service’s initial pay offer in contract negotiations was “appalling.” (Supply Chain Dive)

Private equity firm Carlyle plans to sell its entire 2.53% stake in Indian logistics firm Delhivery. (Reuters)

The parent company of terminal operator SSA Maritime is buying Ceres Terminals and its U.S. East and Gulf coast operations. (Journal of Commerce)

The European Union is putting new restrictions on oil tankers that undertake ship-to-ship crude transfers. (TradeWinds)

Mediterranean Shipping is in talks to acquire Italian high-speed rail operator Italo from Global Infrastructure Partners. (Bloomberg)

Eagle Bulk Shipping bought out Oaktree Capital’s 28% stake in the company and adopted a poison pill to block a takeover effort. (Splash 247)

Self-described ethical food delivery service Foodstuff closed its Manchester, U.K., business. (Manchester Evening News)

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 Twitter at @WSJLogistics.