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Manufacturers Turn to AI to Manage Supply Chains Amid Tariff Volatility

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U.S. manufacturers like The Toro Company are using artificial intelligence to maintain lean “just-in-time” inventories despite ongoing global trade uncertainties and fluctuating tariffs. Toro’s supply chain chief, Kevin Carpenter, says AI helps the company process daily news—from policy updates to commodity prices—into actionable insights, guiding purchasing and inventory decisions.

Generative AI is being increasingly adopted in supply chains, capable of analyzing massive datasets and suggesting optimal actions. Industry research firm Gartner predicts AI software spending for supply chains could rise from $2.7 billion today to $55 billion by 2029. Leading providers include SAP, Oracle, Coupa, Microsoft, and Blue Yonder.

While AI improves efficiency and helps manage cost pressures, experts caution it is not a “silver bullet.” Human oversight remains essential for strategic decisions, with AI handling routine tasks like scheduling and ordering. Companies using AI can better react to uncertainty, reduce excess inventory, and protect profit margins amid rising costs and global disruptions.

MercadoLibre Expands Free Shipping in Brazil to Counter Rising Competition

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MercadoLibre, Latin America’s leading e-commerce platform, announced on Friday a significant expansion of its free shipping policy in Brazil, its largest and most profitable market. The move comes as competition intensifies with rivals like Amazon, Shopee, and emerging players such as Temu gaining traction in the region.

Effective immediately, purchases of 19 reais ($3.40) or more will qualify for free shipping, a sharp reduction from the previous minimum threshold of 79 reais ($14.15). According to Fernando Yunes, head of MercadoLibre’s e-commerce operations in Brazil, “practically the entire site will have free shipping from now on.” This aggressive change aims to boost sales volume across a wider range of products, particularly lower-priced items where competitors have been gaining market share.

Brazil accounts for over 50% of MercadoLibre’s total e-commerce revenue, making the market critical for its overall financial performance. The decision to absorb the financial impact of expanded free shipping underscores the company’s commitment to defending its market leadership. However, Yunes declined to provide specific estimates regarding the cost of the initiative.

The move follows earlier cuts to shipping fees for sellers on the platform, with discounts of up to 40% implemented since late May. Analysts at Itau BBA noted that these changes are strategically targeting product segments where Shopee has been increasingly successful, particularly in lower-priced, high-turnover categories.

While the expanded free shipping is expected to be costly in the short term, MercadoLibre is betting that higher transaction volumes and stronger customer loyalty will offset the immediate financial burden. The company’s long-standing investments in logistics infrastructure, including its proprietary delivery network, provide it with greater flexibility to absorb such aggressive pricing strategies compared to some of its competitors.

MercadoLibre remains Latin America’s most valuable company by market capitalization, but it faces mounting pressure from both established global giants and newer entrants offering highly competitive pricing models. The decision to further lower the free shipping threshold reflects the fierce competition in Brazil’s rapidly growing e-commerce sector, where convenience and price sensitivity remain key drivers of consumer behavior.

Amazon to Test Humanoid Robots for Future Deliveries

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Amazon is preparing to test humanoid robots that could one day replace human delivery workers, according to a report from The Information on Wednesday. Citing a person familiar with the company’s plans, the report reveals that Amazon is building an indoor testing facility dubbed a “humanoid park” at one of its San Francisco offices.

The park will serve as an obstacle course designed to simulate the complex environments that delivery robots may face, allowing Amazon to evaluate how well the robots can navigate real-world delivery scenarios.

Currently, Amazon is focusing on developing the artificial intelligence software necessary to operate these humanoid robots, while relying on hardware provided by third-party companies during initial tests.

Amazon has not publicly commented on the report.

AI-Driven Automation Push

The humanoid robot tests are part of Amazon’s broader push to integrate AI and robotics across its logistics operations. In a series of announcements on Wednesday, Amazon showcased how it plans to use AI-powered systems in its warehouses, stockrooms, and delivery network, all aimed at improving efficiency and speeding up package deliveries.

The company already uses a wide range of automation technologies, including robotic arms, sorting machines, and warehouse bots, but humanoid robots represent a significant next step that could eventually reshape the role of human workers in Amazon’s vast delivery network.

Industry Implications

Amazon’s move reflects a growing trend in the tech and logistics sectors, where companies are investing heavily in advanced robotics to handle labor-intensive tasks amid rising costs and ongoing labor challenges.

While humanoid robots have long been seen as a futuristic concept, advances in AI, machine learning, and robotics hardware are now making human-like functionality more feasible for real-world commercial applications.

However, such developments are likely to raise new debates over job displacement, labor rights, and regulatory oversight, especially as major employers like Amazon explore ways to automate traditionally human roles.