A U.S.-led coalition is warning that it’s prepared to escalate actions aimed at protecting commercial shipping in the Red Sea. The U.S., Britain and key allies issued what American officials described as a final warning to the Houthi Yemeni rebel group, the WSJ’s Michael R. Gordon, Gordon Lubold and Nancy A. Youssef report, after the U.S. military prepared options to strike the Iran-backed rebel group. The group says the Houthis will face “the consequences should they continue to threaten lives, the global economy, and free flow of commerce in the region’s critical waterways.” The Houthis have carried out about 24 attacks on commercial ships since mid-November. Lloyd’s List Intelligence reports the most recent was an attack on a northbound CMA CGM containership. Potential targets by the allied forces could include launchers for antiship missiles and drones, targeting infrastructure such as coastal radar installations, and storage facilities for munitions.

• Tanker rates are increasing as operators assess Red Sea risks on a case-by-case basis. (Lloyd’s List)
• Bolloré Logistics says airfreight demand is rising as companies look to move goods around the Red Sea conflict. (Air Cargo News)

E-commerce sellers Shein and Temu are offering a lifeline for small suppliers in China’s manufacturing hubs—but it isn’t always a straightforward win. The online juggernauts have upended the online retail supply chain with their on-demand business model. The WSJ’s Yoko Kubota, Raffaele Huang and Shen Lu report their approach also transfers inventory risk to suppliers in many cases, leaving many manufacturers drowning in unsold goods, grappling with razor-thin margins and questioning whether dealing with Shein and Temu is sustainable in the long run. One big children’s apparel maker has essentially halted work with one platform after being stuck with too much inventory. The trade-off is at the heart of the business model for Temu and Shein, which place orders to suppliers to be delivered in days and use real-time data and rapid replenishment to cut down on the need for storage and limit inventory risk.

• TikTok told sellers it will start taking a bigger cut of sales on the company’s app. (The Information)
• The e-commerce arm of China’s version of TikTok is making an “express refund” policy mandatory for suppliers dealing with unhappy consumers. (South China Morning Post)

Japanese investigators began inspecting the charred wreckage of a Japan Airlines jet that caught fire following a collision with a coast guard plane in Tokyo’s Haneda Airport on Tuesday. A WSJ video report shows the fiery incident that left five people on the smaller plane dead.

Federal Reserve officials believe they are done raising interest rates but hadn’t started debating last month on when to start lowering them. (WSJ)

A measure of U.S. manufacturing activity ticked upward but remained in contraction territory. (MarketWatch)

Job openings in the U.S. fell in November to a 32-month low. (WSJ)

U.S. auto sales rebounded in 2023, with analysts projecting sales reached 15.5 million vehicles, a 12.4% increase from the prior year. (WSJ)

Xerox is cutting its workforce by 15% and reorganizing its operating model, including a stronger focus on emerging information-technology and digital services. (WSJ)

A senior Panama Canal Authority official estimates it will take $2 billion and six years to fix the pathway’s acute water problem. (Bloomberg)

Italian startup container line Kalypso filed for bankruptcy following a collapse in freight rates and disrupted services to Israel. (Seatrade Maritime)
 
Merchants suspended from Amazon’s marketplace are turning to a cottage industry of lawyers to regain access to their accounts and money. (Financial Times)

A European court rejected an appeal from UPS for $1.9 billion in damages after regulators blocked its 2013 acquisition of TNT Express. (The Loadstar)

Flipkart co-founder Binny Bansal started a venture called OppDoor to provide backend services to other e-commerce operators. (Mint)

Maryland named longtime Port Everglades CEO Jonathan Daniels as head of the Port of Baltimore. (Journal of Commerce)

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.