Download this article in PDF format.
Truck drivers and fleet owners got a nasty surprise at the pump last month as diesel prices topped out at over $6.50 a gallon (as of Sept. 24). They’ve been gradually creeping up due to the ongoing disruption in the Strait of Hormuz and other factors, and have risen nearly $2 per gallon since July 6th, FreightWaves reports.
For a nation that’s highly dependent on over-the-road truck and van freight and has yet to make any significant move toward commercial electric vehicle (EV) usage, higher diesel prices sting and could soon translate into even higher prices for consumer and business goods.
The American Trucking Associations (ATA) says trucks move nearly 73% of the nation’s freight by weight, with roughly 15 million trucks driving about 330 billion miles annually. That’s a lot of diesel fuel now fetching premium rates.
“Since diesel is the lifeblood of the supply chain, a rise in fuel costs may result in higher prices charged by wholesalers in response to elevated transport expenses,” ABC says. “In turn, retailers could pass those costs along to shoppers, raising prices on shelves.”
New Tariffs and Exemptions
Key changes to U.S. tariffs on Canadian goods went into effect last month, with cheeses and motorboats among products added to the list of affected items while toilet paper, fishing rod parts and cement are now exempt. According to IndustryWeek, the move came weeks ahead of U.S. midterm elections, as households and businesses grapple with high costs of living.
The publication says the latest amendments change the mix of Canadian products impacted by 50% U.S. duties, and senior U.S. officials maintained that the tariffs only apply to a small amount of overall bilateral trade. “The duties mark the latest salvo in an escalating trade war between the North American neighbors,” it adds, noting that the president placed a 50% tariff on $20 billion in imports from Canada in August after trade talks collapsed.
For this new round of tariffs, the U.S. government tapped a little-known legal provision for the latest tariffs affecting Canada, Section 338 of the Tariff Act of 1930. The new duties apply to goods covered under the U.S.-Mexico-Canada free trade agreement and come in addition to the sector-specific tariffs.
The Growing AI Chip Talent Crisis
There’s big demand for AI chips right now, but there may not be enough people to produce them. A new report from McKinsey and the SEMI Foundation says the U.S. now is facing a shortage of up to 157,000 semiconductor workers by 2030.
At the heart of the problem is a nation that’s entering what McKinsey calls “the most significant expansion of domestic semiconductor manufacturing capacity in its history.” Announced investments exceeding $390 billion across more than 16 states are expected to begin ramping up materially between 2026 and 2030.
“These commitments underscore the semiconductor sector’s central role in U.S. economic competitiveness, supply chain resilience and national security,” McKinsey says in the report. The commitments also create a workforce challenge. “The U.S. does not currently produce sufficient engineers, technicians, or computer scientists entering semiconductor roles to support the scale, speed, and geographic concentration of planned capacity.”
Job roles and geography both matter here. According to McKinsey, engineers represent the biggest gap and account for about 60% of the unmet demand. Technician gaps range from 38,000-63,000 full-time equivalents (FTEs) and there will also be a shortage of about 6,000 computer scientists who can handle design, automation and modeling functions.
McKinsey says the shortages are geographically concentrated, with Texas, California, New York, Arizona and Oregon facing the largest cumulative gaps due to “overlapping fab ramps and ecosystem concentration.”
Semiconductor Chip Makers Branch Out
Speaking of AI chips, South Korean semiconductor manufacturer SK hynix weighed in with its forecast last month, and it’s not very promising. The Korea Herald says the company’s CEO is forecasting a global memory chip shortage through the end of 2030. That would mean around 4-1/2 more years of tight memory chip supplies.
"After 2030, we expect supply-demand to become more balanced, with the overall AI industry continuing to grow,” the company’s CEO told the publication. The company is also looking beyond memory as AI “increasingly blurs the boundaries between memory, logic and advanced packaging.”
SK hynix is one of several chipmakers that are looking to branch out. According to Reuters, Chinese chipmaker CXMT is going to enter the flash memory chip market in order to broaden its customer base amid a global memory shortage. It plans to establish a research-and-development production line for NAND flash memory at its new plant in Beijing.
“The company has also set up a research institute in the Chinese capital and projects there include NAND development,” Reuters reports, citing anonymous sources familiar with the development. “It was not clear when the R&D production line would start operating or whether CXMT intends to move from R&D and trial production to large-scale commercial manufacturing.”
