Member Briefing December 10, 2024
Four Scenarios for 2025 to Consider
The incoming Trump administration has put forth a wide-ranging agenda, including tariff and tax changes, tightened immigration, and relaxed regulations. Each has the potential to reshape major sectors of the U.S. economy. How might these policy changes affect GDP growth and inflation, and what could that mean for manufacturers? There are four possible economic scenarios—from a soft landing to stagflation—that manufacturers should consider as they plan for 2025 and beyond.
- Soft Landing: Strong Growth, Modest Inflation
- Overheating Economy: High Growth, High Inflation
- Growth Recession: Weak Growth, Modest Inflation
- Stagflation: High Inflation, Weak Growth
Deregulation, lower taxes, reduced immigration and varying GDP growth and inflation present both risk and reward. The four resulting scenarios make agility essential for success in 2025 and beyond. According to the 2025 Pricing for Profitable Growth Outlook, 78% of manufacturers and distributors are concerned about the speed with which they can react to changing market forces, and just 25% rely on a market-based approach to pricing. As the campaign promises coalesce into policy, businesses should prioritize resilience, closely monitor economic indicators and prepare to adapt.
November CPI Forecasts Show Stalled Progress on Inflation
Forecasts for the November Consumer Price Index report find that inflation remained relatively steady last month. Price pressures have eased dramatically since peaking in the summer of 2022, but progress is slowing significantly as the inflation rate approaches the Federal Reserve’s target. Overall, economists expect that consumer prices rose 0.2% on a monthly basis in November, according to FactSet’s consensus estimates. That would mean the annual inflation rate rose slightly to 2.7% from 2.6% in October. Economists expect the core measure of inflation (which excludes volatile food and energy prices) rose 0.28% in November, which would keep the annual rate steady at 3.3%.
Wednesday’s CPI release will be the last piece of major economic data the Fed receives before its December meeting next week. Analysts say a dramatic uptick in inflation could prompt the central bank to pause its rate-cutting cycle this month, but investors aren’t expecting November’s inflation data to meet that criteria. Hirt says an overall monthly inflation print higher than about 0.3% could prompt the Fed to pause.
Person of Interest in CEO Shooting Identified as Luigi Mangione, Incriminating ‘Manifesto’ Found on His Person
The person arrested in Pennsylvania in connection with the shooting death of UnitedHealth CEO Brian Thompson has been identified as Luigi Mangione, 26, officials in New York said on Monday. Mangione was detained at a McDonald's in Altoona, a city about 275 miles from New York City, on Monday morning after an employee recognized him while he was eating in the restaurant, police said.
Mangione has not yet been charged in Thompson's death. He is being held on local charges possibly in connection with presenting a fake ID to police, according to the Times. He would need to be extradited to New York to faces charges in the shooting. He was found with a two-page, handwritten manifesto that was heavily critical of the healthcare industry and warned that violence was the only answer to changing it. "These parasites had it coming," he wrote in the document, a police official who has seen the document told CNN. "I do apologize for any strife and trauma, but it had to be done," it continued.
Global Headlines
Middle East
- US Strikes 75 ISIS Targets In Syria After Assad Regime Collapses – Defense News
- The 11-Day Blitz That Ended 50 Years of Assad Rule in Syria - WSJ
- Who Is Abu Mohammed Al-Golani? What To Know About The Syrian Rebel Leader Who Overthrew Assad - Forbes
- Iran In A ‘Position Of Unprecedented Weakness’ After The Fall Of Assad In Syria – France 24
- Israeli Airstrikes Target Syrian Chemical-Weapons Systems - WSJ
- As Israel Advances On A Syrian Buffer Zone, It Sees Peril And Opportunity - AP
- From Trump And Turkey, To Russia And Iran — Syria’s Regime Change Has Huge Global Consequences - CNBC
- Oil Prices Surge as Syrian Leader Bashar al-Assad Ousted From Power - Newsweek
- Interactive Map- Israel’s Operation In Gaza – Institute For The Study Of War
- Map – Tracking Hamas’ Attack On Israel – Live Universal Awareness Map
Ukraine
- Pentagon Chief Austin Announces $1 Billion In Long-Term Ukraine Aid – Defense News
- Ukraine Under Pressure To Lower Conscription Age To 18 – France 24
- Zelensky Open to Western Troops for Ukraine Security - Newsweek
- Assad’s Downfall Is A Humbling Blow To Russia. How Will It Affect Putin’s Prestige? - AP
- North Korea Trading Soldiers for Russian Fighter Jets, US Says - Newsweek
- Putin Faces Hard Choices If Ukraine War Drags On - Reuters
- Russian Businesses Are Beginning To Bear The Cost Of War – The Economist
- Russian Soldiers Flee Syria, Video Appears To Show - Newsweek
- Interactive Map: Assessed Control Of Terrain In Ukraine – Institute For The Study Of War
- Map – Tracking Russia’s Invasion Of Ukraine – Live Universal Awareness Map
Other Headlines
- France's Macron Faces Mounting Pressure To Name New Prime Minister – France 24
- Argentina's Mr. Market Javier Milei Wants To Make Austerity Great Again – Reuters
- South Korea Imposes Travel Ban On President As He Faces Insurrection Allegations - Forbes
- Chad Protesters Call For Fast Withdrawal Of French Troops After Military Agreement – France 24
- Report Sounds Alarm Over 30-Year Global Drying Trend – Down To Earth
- Portugal Calls For Joint EU Funding For Defence Spending - Reuters
- Tbilisi Clashes Escalate as Georgia Faces Backlash Over EU Talks - Newsweek
- Ghana’s Ex-President John Mahama Is Set To Return After Rival Concedes Election - AP
- Haiti Gang Kills 110 People Accused Of Witchcraft – BBC
Policy and Politics
Hochul Proposes Giving New Yorkers One-Time Stimulus Checks To Offset Cost Of Inflation
Gov. Kathy Hochul unveiled on Monday a proposal to give 8.6 million New Yorkers stimulus checks of between $300 and $500 to offset the strain of inflation in recent years. Hochul, during a Dec. 9 press conference at the Bronx’s Co-Op City housing complex, said that under her proposal, a one-time $300 “Inflation Refund” would go to single New York taxpayers earning up to $150,000 annually and $500 to joint filers bringing in up to $300,000 a year. She said the total $3 billion in direct payments will come from surplus sales tax revenues driven by rising inflation.
The refund will be part of Hochul’s 2026 state budget proposal, which she is also expected to roll out next month and must pass the state legislature by an April 1 deadline. If the measure is approved as part of the budget, the state will begin making the payments next fall, according to the governor’s office. Hochul framed the proposal as part of a broader affordability push she plans to make in the leadup to her annual State of the State address, which is scheduled for Jan. 14.
US Appeals Order Halting Corporate Transparency Act Disclosures
A controversial new law that requires reporting companies to report information to the U.S. government about who ultimately owns and controls them is dead—at least for now. A ruling out of the U.S. District Court for the Eastern District of Texas granted the plaintiffs a preliminary injunction, blocking the U.S. Department of Treasury from enforcing the beneficial ownership information (BOI) reporting requirements under the Corporate Transparency Act (CTA) across the country.
The law cast a wide net. Companies required to report are called reporting companies. A company may be a reporting company if it is a corporation, a limited liability company (LLC), or other entity created by the filing of a document with the state, local, or federal government (or a foreign company registered to do business in the U.S.)—some exceptions apply. Those reports are filed online with the Financial Crimes Enforcement Network (FinCEN). FinCEN expected to receive over 32 million reports in the first year that the law was effective—this year, 2024. The law, intended to make it harder for bad actors to hide their identities and ill-gotten gains through shell companies or opaque corporate structures, pulls in companies and owners. The information that must be reported includes details about the owners, including the name, date of birth, address, and a scanned image of an identifying document like a driver's license or passport—from each so-called "beneficial owner."
TikTok Asks To Pause Ban Until Supreme Court—And Trump—Weigh In
TikTok asked the U.S. Court of Appeals for the D.C. Circuit to impose an injunction that would pause its ruling on Friday, which upheld the law requiring TikTok to divest from Chinese parent company ByteDance or else be banned from U.S. app stores. The company asked for the ruling to be paused—meaning the law won’t take effect—while it asks the Supreme Court to take up the case, arguing the high court should “have an opportunity ... to decide whether to review this exceptionally important case” before the law takes effect.
It also said the pause would give the incoming Trump administration time to weigh in on the legal dispute, arguing President-elect Donald Trump’s position “could moot both the impending harms and the need for Supreme Court review.” Trump reportedly wants to stop the TikTok ban, and the company argued that as a result there’s a “reasonable possibility that the new Administration will pause enforcement of the Act or otherwise mitigate its most severe potential consequences”—even though legal experts have suggested there isn’t a foolproof way for Trump to block the law. If the appeals court doesn’t pause the law, TikTok said they’ll go to the Supreme Court immediately to get an emergency ruling blocking the law while it’s appealed.
Health and Wellness
GSK's Drug Combo Shown To Cut Risk Of Death By 42% In Type Of Blood Cancer
British drugmaker GSK said on Monday its experimental cancer drug Blenrep in combination with other treatments reduced the risk of death by 42% in multiple myeloma, a common type of blood cancer, at or after first relapse compared to an existing treatment. An interim analysis of data from a trial dubbed 'DREAMM-7' showed the drug in combination with the drug bortezomib plus the steroid dexamethasone showed statistically significant overall survival results compared to a standard of care daratumumab combination as a second line or later treatment of relapsed or refractory multiple myeloma, GSK said.
Blenrep had seen several setbacks over the last couple of years after it was pulled from the U.S. markets in 2022 after failing a late-stage study designed to show that it was better than an existing treatment. However, positive results from the DREAMM-7 and DREAMM-8 trials over the past year could mean a comeback for the drug.
Transition 2024
- Lindsey Graham Says Border Bill Should Be ‘First Order Of Business’ – The Hill
- Syria Upheaval Brings Tulsi Gabbard’s Past Into Focus - Politico
- Departing Export-Control Watchdog Predicts Continued Enforcement in Second Trump Term - WSJ
- Trump SEC Pick Wants To Ditch Landmark Climate Disclosure Rule – Utility Dive
- Jason Miller Says Trump’s Suggestion To Jail Jan. 6 Committee Members Was Taken Out Of Context - Politico
- Trump’s Cabinet And Key Jobs: Alina Habba Picked For Counselor To The President - Forbes
- Mark Ruffalo Presses Biden To Act Fast On ‘Forever Chemicals’ Before Trump Takes Office – The Hill
- Trump Prepares for Legal Fight Over His ‘Birthright Citizenship’ Curbs - WSJ
- Tracking Trump’s Cabinet Picks – Politico
Industry News
China Inflation Data Signals Continued Demand Weakness
China’s consumer price growth slowed in November, while factory-gate prices improved but stayed in decline, suggesting persistent weak domestic demand despite Beijing’s push to revive spending. China’s consumer-price index rose 0.2% from a year last month, compared with the 0.3% gain seen in October, according to data released Monday by the National Bureau of Statistics. Economists polled by The Wall Street Journal had expected a 0.5% increase.
The producer-price index, meanwhile, fell 2.5% in November, notching a 26th straight month of decline. That compared with the prior month’s 2.9% drop and the 2.8% contraction economists had expected. While the world’s second-largest economy has shown some signs of stabilization in recent months due to Beijing’s stimulus efforts, Monday’s data signals that policymakers have more work to do to convince consumers and businesses to spend as a years-long property downturn continues to drag on.
OSHA New Arc-Flash Guidance is First in 20 Years
It’s been 20 years since OHSA has updated its arc flash guidance. “OSHA’s new guidance, issued on November 25, targets two major causes of arc flash injuries and fatalities,” explained Derek Sang, senior technical training manager for Bulwark FR, in an EHS webinar. “The first is that manufacturing work as deenergized without following proper lockout/tagout procedures, leaving workers without the right PPE. And the second is believing in myth that low voltage (120/208, 277) isn’t dangerous – leading to energized work done without adequate protection or justification.”
De-energizing equipment is only step toward achieving and Electrically Safe Working Condition (ESWC) and does not eliminate electrical hazards. Proper procedures, such as lockout/tagout and verification of de-energization must be followed. The guidance makes it clear that low voltage, including 120/208, can sustain arc flash, produce molten metal, ignite flammable clothing, and cause severe or fatal injury. All energized work over 50V requires an energized work permit and almost all work requires PPE including arc rated clothing.
Jeep Maker Stellantis Shakes Up North American Executive Ranks
Jeep maker Stellantis is shuffling its executive ranks in North America, a trouble spot that contributed to the recent departure of Chief Executive Carlos Tavares. The changes include the return of company veteran Timothy Kuniskis, who retired under Tavares’ tenure in June, to run Stellantis’s Ram truck brand, a Stellantis spokeswoman said. The company also named a new U.S. sales chief.
The moves mark Stellantis’s most visible shake-up under an interim management committee headed by Chairman John Elkann, the heir to Italy’s Agnelli family, which through holding company Exor is the company’s single-largest shareholder. Kuniskis, well-liked among Stellantis’s U.S. dealers, takes over a Ram brand that has lost ground to rivals General Motors and Ford Motor in the market for big pickup trucks, a vital profit source. Kuniskis spent more than three decades with the company before his retirement, drawing widespread praise for reviving the Dodge muscle-car brand. Chris Feuell, who ran the Ram and Chrysler brands, will retain Chrysler while assuming responsibility for the company’s Alfa Romeo brand in North America from Larry Dominique, a senior vice president who is leaving Stellantis.
DOD To Award $50M To Accelerate Development Of Emerging Tech Projects
The Pentagon announced Saturday that it selected five small, non-traditional defense contractors to receive funding to help move their emerging technologies into production. Each company will receive $10 million under the Accelerate the Procurement and Fielding of Innovative Technologies (APFIT) pilot program overseen by Heidi Shyu, undersecretary of defense for research and engineering. The awards mark the first batch of APFIT funding distributed in fiscal 2025 and they’re being bankrolled through continuing resolution appropriations.
APFIT is intended to steer existing innovation projects across the so-called “valley of death” — a phenomenon in which emerging technologies that have successful research-and-development efforts with the Defense Department fail to receive additional funding for production. The Pentagon did not disclose which companies will receive funding in the latest tranche as it is still finalizing contracts for the selected programs.
Angry VW Workers Issue Ultimatum With Threat Of Strike Escalation In 2025
Volkswagen workers said its management had one last chance to compromise on Monday or risk strikes on a scale not previously seen by the German carmaker, as talks began in a bitter standoff over wage cuts and plant closures. VW staff downed tools at nine German sites which are under threat, while thousands of workers marched waving flags and blowing whistles to a square in Wolfsburg, where the carmaker has its headquarters, to listen to union leaders.
The latest negotiations, which initially kicked off in September, come as Europe's largest carmaker seeks ways to radically cut costs in Germany to better compete with cheaper Asian rivals that have entered its home market. "Today, the workforce is taking a stand in the form of a nationwide warning strike," union IG Metall chief negotiator Thorsten Groeger said. Workers, who have dismissed any cuts to wages or plant closures, can crank up the pressure on VW by eventually staging 24-hour strikes and even open-ended ones.
Boeing To Cut Nearly 400 Workers In Alabama, Florida And Virginia
Boeing has issued layoffs in three more states, beginning Jan. 17, 2025. Boeing sites in Alabama and Florida, as well as its headquarters in Virginia, have announced job cuts totaling 367 employees, according to Worker Adjustment and Retraining Notification Act posts. This adds to the layoffs in Washington, Oregon, Colorado, South Carolina, Pennsylvania, Missouri and Arizona, totaling 2,876 pending job cuts in 10 states.
Washington so far has the largest number of layoffs, with 2,199 beginning Dec. 20. The job cuts are part of Boeing’s plans to reduce its workforce by 10%, roughly 17,000 employees, across locations worldwide as the troubled aircraft titan tries to retain cash after a nearly two-month workers’ strike and an $8 billion net loss throughout the year. The Society of Professional Engineering Employees in Aerospace reported Friday that Boeing issued layoff notices last week to 222 union members in Washington. The job cuts add to 438 issued for union positions last month.
Read more at Manufacturing Dive
White House Proposes CHIPS Awards To 3 Chipmakers
The Biden-Harris administration proposed three CHIPS and Science Act funding awards on Friday to Coherent, SkyWater Technology Foundry, and X-Fab, the Commerce Department announced. The funding will be used for three semiconductor facility expansions in Texas and Minnesota, according to the release. Coherent’s up to $33 million in CHIPS funding will modernize and expand its Sherman, Texas, facility, creating about 70 jobs. The expanded manufacturing cleanroom in Coherent’s existing 700,000-square-foot facility will install a 150mm indium phosphide manufacturing line by adding advanced wafer fabrication equipment to produce InP devices at scale.
InP optoelectronic devices are used in applications such as datacom and telecom transceivers, including for AI infrastructure, medical and automotive applications. SkyWater Technology’s $16 million in CHIPS funding will be used to upgrade its Bloomington, Minnesota, facility, improving wafer production capacity by 30% and creating 70 jobs. The company is a Department of Defense Trusted Foundry supplier, a program for companies that assure integrity and confidentiality of integrated circuits down the supply chain.
Read more at Manufacturing Dive
Former SpaceX Engineer Seeks To Help End US Dearth Of Special Uranium Fuel
Former SpaceX engineer Scott Nolan, CEO of startup General Matter, is on a mission to help end Russia's monopoly on a type of more-enriched nuclear fuel by producing it at commercial scale in the United States and slashing its costs. Nolan incorporated San Francisco-based General Matter this year in order to make high-assay low-enriched uranium, or HALEU, for a variety of planned atomic plants including small modular reactors, or SMRs, that backers hope will take off in the 2030s.
HALEU is uranium enriched to between 5% and 20%, which backers say has the potential to make new high-tech reactors more efficient. Uranium fuel used in today's reactors is enriched to about 5%. Big Tech companies such as Amazon (AMZN.O), opens new tab have plans to build new reactors to serve power-hungry data centers. The goal of General Matter is to halve the cost of HALEU enrichment, long term, Nolan said. HALEU is made primarily in Russia, and its price is elusive. Estimates range from $25,000 to $35,000 per kilogram of uranium.
Dwarfed By China In Shipbuilding, US Looks To Build Its Defense Base
The U.S. severely lags behind China in shipbuilding capacity, lawmakers and experts have warned, as the Biden administration tries to build up the country’s ability to develop and produce weapons and other defense supplies to fend off war. The U.S. government has come to see China as its “pacing challenge,” and officials have warned that Beijing is pursuing the largest peacetime military buildup in history, raising concerns about how the U.S. would respond and ensure victory in case of a conflict in the Indo-Pacific, where tensions are high in the Taiwan Strait and the South China Sea.
The challenge in shipbuilding has been “especially immense,” stemming from the hollowing-out of the U.S. manufacturing base where its workforce shrank and suppliers left, National security adviser Jake Sullivan said. On Thursday, the congressional panel heard suggestions from experts who said it would take time to rebuild the defense industrial base, but for quicker fixes, the U.S. could innovate to make low-cost and autonomous systems and tap resources of its allies.
China Targets Nvidia With Antitrust Probe, Escalates US Chip Tensions
China said on Monday it has launched an investigation into Nvidia Corp over suspected violations of the country's anti-monopoly law, in a move widely seen as a retaliatory shot against Washington's latest curbs on the Chinese chip sector. The statement from the State Administration for Market Regulation (SAMR) announcing the probe did not elaborate on how the U.S. company, known for its artificial intelligence (AI) and gaming chips, might have violated China's anti-monopoly laws.
The investigation comes after the U.S. last week launched its third crackdown in three years on China's semiconductor industry, which saw Washington curb exports to 140 companies, including chip equipment makers. In a sign that China intends to fight back strongly against the latest move, shortly after Washington's announcement Beijing banned exports to the United States of the critical minerals gallium, germanium and antimony.