Good morning, MFG’s.

Washington is overhauling trade rules for American factories, passing a new law to close the "de minimis" loophole exploited by foreign e-commerce giants.

The change forces overseas sellers to compete on more equal footing by ending the $800 duty-free threshold. With the law tied to a 10-year budget window, the key question is whether this provides the long-term stability US manufacturers need to thrive.

In today’s MFG recap:

• Washington overhauls US manufacturing with new trade law

• The Navy’s fleet of large-scale metal 3D printers

• Google switches from Samsung to TSMC for its G5 chip

• A new facility for high-performance sustainable aviation fuel

Washington's Manufacturing Overhaul

MFG NOW: Washington is leveling the playing field for American factories by passing a major new law that closes the massive "de minimis" trade loophole previously exploited by foreign e-commerce giants.

Unpacked:

• The loophole saw duty-free imports skyrocket from 139 million packages in 2015 to over 1.36 billion in 2024, with a total value of around $65 billion.

• This unregulated flood allowed products made with unsafe chemicals and potential forced labor to enter the country, undercutting US safety standards and businesses.

• The new law ends the $800 duty-free threshold for all countries by July 2027, but the change is not permanent as it is currently tied to a 10-year budget window.

Bottom line: This change forces foreign sellers to compete on more equal footing, removing a significant cost advantage they have held over domestic producers. It also signals a larger policy shift toward prioritizing the integrity and security of American supply chains.

The Navy's 3D Printing Fleet

MFG NOW:The U.S. Navy is partnering with Australian firm AML3D to deploy a massive fleet of metal 3D printers, aiming to overhaul how it produces and maintains parts for its ships.

Unpacked:

• The core technology is AML3D's ARCEMY platform, which uses a wire-arc process in an open-air environment to create very large metal parts without the size limits of traditional printers.

• The Navy's goal is to produce up to 1,600 critical components on-demand annually by 2030, a move intended to reduce its reliance on slower, conventional supply chains for cast or forged parts.

• This initiative is backed by a powerful ecosystem of partners, including major shipbuilder Austal and research experts at Oak Ridge National Laboratory, to speed up integration.

Bottom line: This major defense initiative provides a strong endorsement for using additive manufacturing in demanding industrial environments. It also marks a strategic pivot toward localized, on-demand production to bolster supply chain resilience and national security.

Chipmaker Showdown

MFG NOW: In a major blow to its foundry business, Samsung has lost the contract for Google’s next-generation Tensor G5 chip. Google is shifting production to rival TSMC, signaling deep concerns over Samsung's manufacturing capabilities.

Unpacked:

• The decision stems from Samsung's catastrophically low yield of usable 3nm chips, with defect rates around 50% compared to TSMC's rate of less than 10%.

• Beyond production volume, TSMC-made chips consistently demonstrate a slight but significant advantage in speed and power consumption over their Samsung counterparts.

• TSMC's stable production is supported by a broad diversified customer base including Apple, AMD, and Nvidia, which allows it to optimize factory use and distribute R&D costs effectively.

Bottom line: This move highlights a critical technology and reliability gap between the two semiconductor titans. Samsung is now under immense pressure to overhaul its foundry processes to prevent further client defections.

Next-Gen Fuel Heats Up

MFG NOW: Advanced fuel company CleanJoule has commissioned its new Utah facility, a critical milestone toward the commercial production of its high-performance sustainable aviation fuel.

Unpacked:

• CleanJoule’s CycloSAF offers 10% greater energy density than conventional Jet A fuel, increasing aircraft range and performance.

• The new facility, CJ1, is a manufacturing blueprint for a future network of plants, each designed to scale production to 100 million gallons per year.

• The company uses abundant biomass to strengthen the domestic supply chain, reducing reliance on foreign energy and supply chain risks.

Bottom line: This move accelerates the availability of a higher-performance, drop-in biofuel for the aviation, aerospace, and defense sectors. It also provides a scalable model for building a more resilient, domestically-sourced energy infrastructure.

The Shortlist

The National Association of Manufacturers claims in a new report that over 51% of U.S. manufacturers already use AI, with 80% predicting the technology will be essential to their business by 2030.

NASA earned its "invention of the year" award for a multi-material rocket thrust chamber, combining powder bed fusion, DED, and cold spray to create a single high-performance component with a 40% weight reduction.

Researchers developed a new micro-assembly method that overcomes fabrication limits for photonic crystal cavities, paving the way for scalable manufacturing of next-generation optical chips for AI and quantum computing.

Grant Thornton is hosting a webcast for manufacturers on building a business case for AI, focusing on identifying high-impact use cases and quantifying potential returns to turn AI concepts into growth catalysts.