Warehouse robots provide shields against cyberthreats
As warehouses go increasingly digital, they also become more vulnerable to hackers. But makers of autonomous mobile warehouse robots say they’ve got that covered, citing the multilayered security protocols built into their systems.
Ben Ames has spent 20 years as a journalist since starting out as a daily newspaper reporter in Pennsylvania in 1995. From 1999 forward, he has focused on business and technology reporting for a number of trade journals, beginning when he joined Design News and Modern Materials Handling magazines. Ames is author of the trail guide "Hiking Massachusetts" and is a graduate of the Columbia School of Journalism.
A quick look at business headlines shows that cyberthreats are one of the top challenges confronting American companies. From ransomware to customer-data leaks and intellectual property theft, hackers seem to be lurking around every corner, and they’re not sparing logistics operators.
Big names that have reportedly fended off cyberattacks in the past year include the Seattle-based freight forwarder Expeditors, German shipping group Hapag-Lloyd, Indian container handling facility the Jawaharlal Nehru Port Container Terminal (JNPCT), and German customs broker Hellmann Worldwide Logistics. The rise in cybercrime even led the White House this spring to advise companies to boost their defenses against cyberthreats and prompted the U.S. Customs and Border Protection agency to warn that such attacks could threaten critical supply chain operations in particular.
But amid the push to ward off hackers, there’s one sector that is seldom mentioned: the humble warehouse. That omission is partly a product of outdated thinking. For decades, most warehouses were simply large buildings filled to the rafters with inventory—and with very few computers to attack. But that all changed with the advent of warehouse automation. Today’s distribution center is more likely to be a humming hive of robots and other automated equipment, all connected wirelessly to warehouse management systems (WMS) and other software that could potentially be exploited by hackers.
Given these vulnerabilities, it’s no surprise that developers of automated logistics equipment are also adding “armor” to protect their technology from these threats. But adding armor is just the half of it. There are also things warehouse leaders can do to protect their data, these developers say. And the protective measures don’t have to be complicated, they add, noting that simply following some basic security principles can reduce an operation’s exposure to cyberattacks and help safeguard its customers’ data.
SAFE AND SECURE
The first wall of defense for warehouse automation systems such as autonomous mobile robots (AMRs) is having them operate within the building’s own intranet, says Nathan Cao, head of technical services for Geek +, a developer of warehouse robots and artificial intelligence (AI) products.
Although the types of devices being connected to these intranets have evolved over time, companies have successfully protected their intranets for years through industry-standard approaches such as ISO/IEC 27001, Cao says. That standard offers a set of information security management protocols defined by the International Organization for Standardization (ISO) to protect assets such as financial information, intellectual property, employee details, and information entrusted to them by third parties.
Those same industry standards are also key to protecting communications outside the building, like the data exchanged between automated equipment and various cloud platforms, says Akash Gupta, CTO and co-founder of GreyOrange Pte Ltd., another developer of AMRs and order fulfillment optimization products.
In GreyOrange’s case, the company’s cloud-based GreyMatter fulfillment optimization software exchanges data with each client’s own cloud-based platforms, such as an enterprise resource planning (ERP) or order management system. That connection happens through application programming interfaces (APIs) that are secured with industry-standard processes, Gupta says.
The GreyMatter system then hands down instructions to individual robots in the warehouses, but it sends them only relevant data like bin locations and picking sequences, instead of sensitive data such as customer names, addresses, or financial information.
6 River Systems, another provider of AMRs and fulfillment software, takes a similar approach with its “Chuck” model robots, which work collaboratively with human order pickers to optimize fulfillment operations. Those robots are designed to strictly limit the information they can exchange, the company says.
“We don’t want customer information at 6 River Systems; we only want the data to empower Chuck to path-plan, pick an item, and confirm,” says Gillan Hawkes, 6 River’s vice president of product and analytics. “It’s just metadata, like weight, dimension, and shelf location, not end-user information like a delivery address.”
To obtain that information, the 6 River robots communicate with cloud-based servers through the same hypertext transfer protocol secure (https) system that many people use for secure communication over computer networks while browsing the internet. They further protect their communication outside the building by using APIs with “encrypted tunnels,” the company says.
FINDING SAFETY IN LAYERS
Deploying these multiple layers of cyberdefenses is critical, according to Berkshire Grey, another developer of robotic order fulfillment solutions. The company says that relying on a customer’s corporate intranet alone is no guarantee of overall security, since intruders typically attempt to “punch holes” in these security systems through the very mechanisms—wireless networks and cloud connections—that enable warehouse robots to do their jobs.
For that reason, BerkshireGrey follows the same approach used by its fellow vendors, choosing to exchange only minimal, non-sensitive information with cloud platforms, says Pras Velagapudi, the company’s director of engineering. And it follows a redundant approach to security by building in multiple layers of protection.
“The best defense is one that puts up a fight even if [only a single] layer is compromised,” Velagapudi says. “We employ a multilayer approach to security: restrict information, restrict access, and encrypt data. This ensures that it is not only difficult to compromise the system, but also that if a component gets compromised, it is difficult to use that to get to sensitive information or exploit any other part of the system.”
The task of cyberdefense has never been more important than it is today, as the logistics sector adds new technology to every operation and as global unrest triggers an increase in attacks. A recent report by the cybersecurity service provider Trellix found an increase in cyber activity targeting critical infrastructure sectors during the fourth quarter of 2021, with 27% of those threats targeting transportation and shipping companies.
But suppliers of automated warehouse equipment say they are up to the challenge, applying both information technology (IT) industry standards and specific logistics-focused strategies to fend off attacks and keep fulfillment operations rolling.
Congestion on U.S. highways is costing the trucking industry big, according to research from the American Transportation Research Institute (ATRI), released today.
The group found that traffic congestion on U.S. highways added $108.8 billion in costs to the trucking industry in 2022, a record high. The information comes from ATRI’s Cost of Congestion study, which is part of the organization’s ongoing highway performance measurement research.
Total hours of congestion fell slightly compared to 2021 due to softening freight market conditions, but the cost of operating a truck increased at a much higher rate, according to the research. As a result, the overall cost of congestion increased by 15% year-over-year—a level equivalent to more than 430,000 commercial truck drivers sitting idle for one work year and an average cost of $7,588 for every registered combination truck.
The analysis also identified metropolitan delays and related impacts, showing that the top 10 most-congested states each experienced added costs of more than $8 billion. That list was led by Texas, at $9.17 billion in added costs; California, at $8.77 billion; and Florida, $8.44 billion. Rounding out the top 10 list were New York, Georgia, New Jersey, Illinois, Pennsylvania, Louisiana, and Tennessee. Combined, the top 10 states account for more than half of the trucking industry’s congestion costs nationwide—52%, according to the research.
The metro areas with the highest congestion costs include New York City, $6.68 billion; Miami, $3.2 billion; and Chicago, $3.14 billion.
ATRI’s analysis also found that the trucking industry wasted more than 6.4 billion gallons of diesel fuel in 2022 due to congestion, resulting in additional fuel costs of $32.1 billion.
ATRI used a combination of data sources, including its truck GPS database and Operational Costs study benchmarks, to calculate the impacts of trucking delays on major U.S. roadways.
There’s a photo from 1971 that John Kent, professor of supply chain management at the University of Arkansas, likes to show. It’s of a shaggy-haired 18-year-old named Glenn Cowan grinning at three-time world table tennis champion Zhuang Zedong, while holding a silk tapestry Zhuang had just given him. Cowan was a member of the U.S. table tennis team who participated in the 1971 World Table Tennis Championships in Nagoya, Japan. Story has it that one morning, he overslept and missed his bus to the tournament and had to hitch a ride with the Chinese national team and met and connected with Zhuang.
Cowan and Zhuang’s interaction led to an invitation for the U.S. team to visit China. At the time, the two countries were just beginning to emerge from a 20-year period of decidedly frosty relations, strict travel bans, and trade restrictions. The highly publicized trip signaled a willingness on both sides to renew relations and launched the term “pingpong diplomacy.”
Kent, who is a senior fellow at the George H. W. Bush Foundation for U.S.-China Relations, believes the photograph is a good reminder that some 50-odd years ago, the economies of the United States and China were not as tightly interwoven as they are today. At the time, the Nixon administration was looking to form closer political and economic ties between the two countries in hopes of reducing chances of future conflict (and to weaken alliances among Communist countries).
The signals coming out of Washington and Beijing are now, of course, much different than they were in the early 1970s. Instead of advocating for better relations, political rhetoric focuses on the need for the U.S. to “decouple” from China. Both Republicans and Democrats have warned that the U.S. economy is too dependent on goods manufactured in China. They see this dependency as a threat to economic strength, American jobs, supply chain resiliency, and national security.
Supply chain professionals, however, know that extricating ourselves from our reliance on Chinese manufacturing is easier said than done. Many pundits push for a “China + 1” strategy, where companies diversify their manufacturing and sourcing options beyond China. But in reality, that “plus one” is often a Chinese company operating in a different country or a non-Chinese manufacturer that is still heavily dependent on material or subcomponents made in China.
This is the problem when supply chain decisions are made on a global scale without input from supply chain professionals. In an article in the Arkansas Democrat-Gazette, Kent argues that, “The discussions on supply chains mainly take place between government officials who typically bring many other competing issues and agendas to the table. Corporate entities—the individuals and companies directly impacted by supply chains—tend to be under-represented in the conversation.”
Kent is a proponent of what he calls “supply chain diplomacy,” where experts from academia and industry from the U.S. and China work collaboratively to create better, more efficient global supply chains. Take, for example, the “Peace Beans” project that Kent is involved with. This project, jointly formed by Zhejiang University and the Bush China Foundation, proposes balancing supply chains by exporting soybeans from Arkansas to tofu producers in China’s Yunnan province, and, in return, importing coffee beans grown in Yunnan to coffee roasters in Arkansas. Kent believes the operation could even use the same transportation equipment.
The benefits of working collaboratively—instead of continuing to build friction in the supply chain through tariffs and adversarial relationships—are numerous, according to Kent and his colleagues. They believe it would be much better if the two major world economies worked together on issues like global inflation, climate change, and artificial intelligence.
And such relations could play a significant role in strengthening world peace, particularly in light of ongoing tensions over Taiwan. Because, as Kent writes, “The 19th-century idea that ‘When goods don’t cross borders, soldiers will’ is as true today as ever. Perhaps more so.”
Hyster-Yale Materials Handling today announced its plans to fulfill the domestic manufacturing requirements of the Build America, Buy America (BABA) Act for certain portions of its lineup of forklift trucks and container handling equipment.
That means the Greenville, North Carolina-based company now plans to expand its existing American manufacturing with a targeted set of high-capacity models, including electric options, that align with the needs of infrastructure projects subject to BABA requirements. The company’s plans include determining the optimal production location in the United States, strategically expanding sourcing agreements to meet local material requirements, and further developing electric power options for high-capacity equipment.
As a part of the 2021 Infrastructure Investment and Jobs Act, the BABA Act aims to increase the use of American-made materials in federally funded infrastructure projects across the U.S., Hyster-Yale says. It was enacted as part of a broader effort to boost domestic manufacturing and economic growth, and mandates that federal dollars allocated to infrastructure – such as roads, bridges, ports and public transit systems – must prioritize materials produced in the USA, including critical items like steel, iron and various construction materials.
Hyster-Yale’s footprint in the U.S. is spread across 10 locations, including three manufacturing facilities.
“Our leadership is fully invested in meeting the needs of businesses that require BABA-compliant material handling solutions,” Tony Salgado, Hyster-Yale’s chief operating officer, said in a release. “We are working to partner with our key domestic suppliers, as well as identifying how best to leverage our own American manufacturing footprint to deliver a competitive solution for our customers and stakeholders. But beyond mere compliance, and in line with the many areas of our business where we are evolving to better support our customers, our commitment remains steadfast. We are dedicated to delivering industry-leading standards in design, durability and performance — qualities that have become synonymous with our brands worldwide and that our customers have come to rely on and expect.”
In a separate move, the U.S. Environmental Protection Agency (EPA) also gave its approval for the state to advance its Heavy-Duty Omnibus Rule, which is crafted to significantly reduce smog-forming nitrogen oxide (NOx) emissions from new heavy-duty, diesel-powered trucks.
Both rules are intended to deliver health benefits to California citizens affected by vehicle pollution, according to the environmental group Earthjustice. If the state gets federal approval for the final steps to become law, the rules mean that cars on the road in California will largely be zero-emissions a generation from now in the 2050s, accounting for the average vehicle lifespan of vehicles with internal combustion engine (ICE) power sold before that 2035 date.
“This might read like checking a bureaucratic box, but EPA’s approval is a critical step forward in protecting our lungs from pollution and our wallets from the expenses of combustion fuels,” Paul Cort, director of Earthjustice’s Right To Zero campaign, said in a release. “The gradual shift in car sales to zero-emissions models will cut smog and household costs while growing California’s clean energy workforce. Cutting truck pollution will help clear our skies of smog. EPA should now approve the remaining authorization requests from California to allow the state to clean its air and protect its residents.”
However, the truck drivers' industry group Owner-Operator Independent Drivers Association (OOIDA) pushed back against the federal decision allowing the Omnibus Low-NOx rule to advance. "The Omnibus Low-NOx waiver for California calls into question the policymaking process under the Biden administration's EPA. Purposefully injecting uncertainty into a $588 billion American industry is bad for our economy and makes no meaningful progress towards purported environmental goals," (OOIDA) President Todd Spencer said in a release. "EPA's credibility outside of radical environmental circles would have been better served by working with regulated industries rather than ramming through last-minute special interest favors. We look forward to working with the Trump administration's EPA in good faith towards achievable environmental outcomes.”
Editor's note:This article was revised on December 18 to add reaction from OOIDA.
Global trade will see a moderate rebound in 2025, likely growing by 3.6% in volume terms, helped by companies restocking and households renewing purchases of durable goods while reducing spending on services, according to a forecast from trade credit insurer Allianz Trade.
The end of the year for 2024 will also likely be supported by companies rushing to ship goods in anticipation of the higher tariffs likely to be imposed by the coming Trump administration, and other potential disruptions in the coming quarters, the report said.
However, that tailwind for global trade will likely shift to a headwind once the effects of a renewed but contained trade war are felt from the second half of 2025 and in full in 2026. As a result, Allianz Trade has throttled back its predictions, saying that global trade in volume will grow by 2.8% in 2025 (reduced by 0.2 percentage points vs. its previous forecast) and 2.3% in 2026 (reduced by 0.5 percentage points).
The same logic applies to Allianz Trade’s forecast for export prices in U.S. dollars, which the firm has now revised downward to predict growth reaching 2.3% in 2025 (reduced by 1.7 percentage points) and 4.1% in 2026 (reduced by 0.8 percentage points).
In the meantime, the rush to frontload imports into the U.S. is giving freight carriers an early Christmas present. According to Allianz Trade, data released last week showed Chinese exports rising by a robust 6.7% y/y in November. And imports of some consumer goods that have been threatened with a likely 25% tariff under the new Trump administration have outperformed even more, growing by nearly 20% y/y on average between July and September.