MARKET BRIEF | December 2025
CMA CGM Restarts Red Sea Shipping Routes
CMA CGM is taking concrete steps to restart container shipping through the Red Sea and Suez Canal after nearly two years of widespread avoidance, due to Houthi attacks and elevated concerns of war. The company plans to resume full east-west service loops via the Suez Canal, beginning with key strings such as its India–America Express, enabled by a Gaza ceasefire that has driven down war-risk insurance costs about 70%. While other carriers remain cautious, CMA CGM’s move, including recent ultra-large ship transits, signals a gradual revival of this critical maritime trade corridor.
European Supply Chains Moving Away from China
According to a European Union Chamber of Commerce in China survey, European companies are increasingly shifting supply chains away from China, amid rising trade uncertainty and Beijing’s expanding export controls on critical materials. More than 70% of EU firms operating in China have reassessed their supply chain strategies over the past two years, with a notable share exploring alternative sourcing outside China, plus increasing regional localization. Sector responses vary, with IT, telecom, and retail firms diversifying away while others onshore within China. However, about 22% still depend on Chinese components with no current alternatives, underscoring persistent vulnerabilities.
U.S. Freight Surges Spark Capacity Issues & Labor Stress
U.S. freight demand has surged in 2025, pushing logistics operators toward full utilization while labor shortages constrain capacity. Roughly 85% of freight businesses report operating near full capacity, meaning even small disruptions can significantly slow movement and reliability. Recruiting and retaining drivers remains a persistent challenge, with many carriers citing a lack of qualified applicants and heightened turnover as barriers to meeting demand. Many firms are turning to technology and automation to compensate for workforce gaps, but tight capacity and continued labor stress are elevating costs and complicating on-time delivery performance across road freight networks.
Walmart Starts Drone Deliveries in Atlanta
Walmart and drone partner Wing have launched commercial drone delivery in the metro Atlanta area, rolling out service from six Walmart stores. The program delivers groceries, household goods, and over-the-counter medicine – with flight times often around five minutes or less – accessed through the Wing app. This Atlanta launch is part of a broader expansion in 2026 that will extend drone deliveries to about 100 Walmart stores across five major U.S. metropolitan areas, including Houston, Charlotte, Orlando, and Tampa. Walmart views the move as a strategic enhancement of last-mile speed and convenience that follows earlier success in the Dallas-Fort Worth market.
