Japan Airlines began testing humanoid robots for ground operations at Tokyo’s Haneda Airport amid chronic labor shortages.

The airline is partnering with GMO AI & Robotics to trial robots for tasks such as baggage loading and cabin cleaning starting in May, according to a joint statement Monday.

The initiative comes as Japan’s aviation sector struggles with rising tourism demand and a shrinking workforce, driven by an aging population.

Japan Airlines said the humanoid robots are expected to be deployed progressively across Haneda Airport, with the trial lasting for two years.

In a video demonstration of the technology, a humanoid robot produced by China’s Unitree can be seen sliding a payload across a conveyor belt, waving to onlookers, and shaking a coworker’s hand. 

Shares of Japan Airlines rose 3.4% in the first trading day of May, but were trading around 13% lower so far this year.

Unitree, one of China’s leading robotics firms, debuted its flagship H1 model in a Kung Fu demonstration at China’s Spring Festival Gala in February to much fanfare.

It is, however, unclear whether Unitree is directly involved in the Haneda Airport trial or is part of a broader evaluation of commercially available humanoid technologies. In a response to CNBC’s queries, Japan Airlines said that “feasibility studies and risk assessments” were ongoing.

Unitree did not respond to CNBC’s requests for comment.

Japan’s working-age population is projected to decline by 31% from 2023 to 2060, according to an employment outlook by the Organization for Economic Co-operation and Development. Marc Einstein, research director from Counter Research, expects humanoid robots to play an increasing role in Japan’s workforce.

With Prime Minister Sanae Takaichi’s support base premised on tougher immigration policies, Einstein expects the government to “very much encourage the deployment of humanoids in Japan.”

In March, Japan’s Ministry of Economy, Trade and Industry published guidelines on the use of robotics and artificial intelligence to address workforce challenges, including “decreasing labor caused by a declining birthrate and aging population.”

Data from Japan’s National Tourism Organization showed international arrivals rose 3.5% in March from a year earlier, increasing pressure on airport operations.

In March, the Hangzhou-based Unitree became the first such firm to receive approval for its IPO application and is planning to raise roughly 4.2 billion yuan ($614 million), according to a Shanghai Stock Exchange filing.

Despite rapid technological progress, it remains unclear whether humanoid robots can fully address Japan’s chronic labor shortage.

Analysts have previously told CNBC that humanoids still lack the dexterity for more delicate tasks and precise movements.

Einstein said the programming and reasoning involved in humanoid technologies remain largely underdeveloped. The deployment of these humanoid robots will likely still require human involvement, he added.

“These robots, they’re just not very smart yet,” Einstein said.

Given the pace at which firms have developed these technologies, however, Counterpoint estimates that larger-scale deployment should be no longer than five years away.

— CNBC’s Evelyn Cheng contributed to this report.

A shortage of air traffic controllers are delaying flights, the Federal Aviation Administration warned on Wednesday, as concerns grow about the effect of the government shutdown on U.S. aviation.

There were half-hour delays at Ronald Reagan Washington National Airport late Wednesday afternoon due to staffing, the FAA said.

About 10,000 flights were delayed on Monday and Tuesday, though disruptions dropped on Wednesday to just over 3,200. Delays could be caused by weather or other reasons aside from staffing issues. But a shortfall of already-thin air traffic control staffing this week had prompted the FAA to slow or halt arrivals in Burbank, California, and Nashville, Tennessee, among others.

Transportation Secretary Sean Duffy warned Monday that the FAA is seeing a “slight uptick” in sick calls of air traffic controllers.

He also said the shutdown is exacerbating concerns about the strain on air traffic controllers, a shortage of whom has vexed airline executives for years. 

“Nearly 11,000 fully certified controllers remain on the job, many working 10-hour shifts as many as six days a week, showing extraordinary dedication to safely guiding millions of passengers to their destinations—all without getting paid during this shutdown,” the air traffic controllers’ union, the National Air Traffic Controllers Association, said in a statement.

Earlier Wednesday, the FAA had warned there could be a staffing trigger at Newark Liberty International Airport, but that caution had been removed by the afternoon. Newark was not seeing an influx of flight delays.

The government shutdown stretched into its eighth day Wednesday, as the Senate failed to pass a funding proposal again.

Duffy said Tuesday on CNBC’s “Squawk Box” that no one airport is consistently having issues with air traffic controller staffing and urged Congress to pass a funding bill.

“The conversations and the fights that are happening are about issues allegedly that are going to come to fruition at the end of the year,” he said. “Open up the government, take the months to have a conversation and negotiate, but let’s not use this as leverage with hardworking Americans that keep our skies safe for political benefit.”

During a shutdown, “essential” workers such as air traffic controllers and TSA agents are continuing to work without pay, while many other employees are placed on furlough.

A more than monthlong shutdown that started in late 2018 ended early the next year, hours after a shortage of air traffic controllers snarled air travel in New York.

President Donald Trump’s steep tariffs on Canada, Mexico and China could worsen ex­ist­ing drug shortages in the U.S., raise health-care costs for patients and threaten cash-strapped generic drugmakers, some drug trade groups warn.

Trump on Saturday announced he would impose a 25% tariff on nearly all goods shipped from Canada and Mexico and a 10% charge on imports from China, all of which were set to take effect on Tuesday. On Monday, both Mexico and Canada said the tariffs would be paused for about a month.

Still, the proposed import taxes come as the U.S. grapples with an unprecedented shortfall of crucial medicine ranging from injectable cancer therapies to generics, or cheaper versions of brand-name medicines, which has forced hospitals and patients to ration drugs. It also comes as many Americans struggle to afford the high costs of prescription medications. 

The U.S. relies heavily on other countries for pharmaceutical products, especially for generic drugs. Those medications make up 90% of Americans’ prescriptions, so tariffs could potentially threaten many patients’ access to affordable treatments. 

China in particular is a large supplier of active pharmaceutical ingredients, or APIs, for both brand-name and generic drugs due to lower manufacturing costs in the country. APIs are the main component of a drug that causes the desired effect of the treatment. Some generic drugs are manufactured overseas entirely.  

The tariffs could “increase already problematic drug shortages” by forcing generic manufacturers out of the market due to low profit margins, according to a statement from John Murphy, CEO of the Association for Accessible Medicines, which represents generic pharmaceutical companies. 

“Generic manufacturers simply can’t absorb new costs,” Murphy said Sunday. “Our manufacturers sell at an extremely low price, sometimes at a loss, and are increasingly forced to exit markets where they are underwater.” 

He urged the Trump administration to exempt generic products from tariffs, adding that the overall value of all generic sales in the U.S. has decreased by $6.4 billion in five years despite “growth in volume” and new generic drug launches. 

The Healthcare Distribution Alliance, which represents 40 drug distributors, has also called for the Trump administration to reconsider including pharmaceutical products in tariffs. In a statement Sunday, the group said tariffs would strain the pharmaceutical supply chain and “could adversely affect American patients,” whether that is through increased medical product costs or manufacturers leaving the market. 

The group said the tariffs will put additional pressure on an industry already in financial distress, noting that distributors operate on low profit margins of just 0.3%.

The U.S. will likely see “new and worsened shortages of important medications,” and those costs will be “passed down to payers and patients, including those in the Medicare and Medicaid programs,” the Healthcare Distribution Alliance said. 

An estimate from The Budget Lab at Yale University said long-term prices of pharmaceutical products in the U.S. will be 1.1% higher after shifts in the supply chain. 

Pharmaceutical Research and Manufacturers of America, which represents pharmaceutical companies, said in a statement that it shares Trump’s goal of ensuring the U.S. maintains its “global leadership in biopharmaceutical innovation and manufacturing.”

Trade measures should focus on “addressing unfair practices abroad and safeguarding our intellectual property,” the group added.

For example, Intuitive Surgical, which manufactures robotic surgical systems, disclosed in its annual report last week that a “significant majority” of the company’s instruments and accessories are manufactured in Mexicali, Mexico. 

Tariffs on the country would “increase the costs of our products manufactured in Mexico and adversely impact our gross profit,” the company said. 

AdvaMed, the largest medical device association globally, urged the Trump administration to exempt medical products from the tariffs. In a statement, the group said import taxes could lead to shortages of critical medical technologies, higher prices for patients and payers, and less investment in research and development. 

The tariffs and associated costs essentially function as “an excise tax in practice,” AdvaMed said, noting that Trump provided a carve-out for much of the medical technology sector when he imposed tariffs on China during his first term. 

Tariffs could also impact hospitals, which rely on imports for everyday supplies, such as gowns, gloves and syringes, along with bigger items such as X-ray equipment. 

But the American Medical Manufacturers Association, which advocates for U.S. businesses that produce medical personal protective equipment, or PPE, supports the tariffs on China and increasing domestic production of those products. 

In a statement Monday, the group said the tariffs recognize that China has “not changed its ways and continues to engage in anti-competitive and hazardous behavior that harms U.S. PPE and medical supply manufacturers and threatens our supply chains and national security.”

Last month, the American Red Cross declared an emergency blood shortage after its national supply fell by more than 25% in July. One startup’s solution: Lab-grown blood.

Shortages can be dire for patients since doctors have to make tough decisions about who needs blood transfusions the most. The American Red Cross collects and distributes about 40% of the U.S.’ blood supply, per its website, and the organization is imploring more people to donate. 

But if Doug McConnell has his way, hospitals and clinics won’t have to rely on donations forever. McConnell is CEO of a four-year-old startup called Safi Biotherapeutics, which is working to manufacture inexpensive red blood cells at scale. 

Scientists have already discovered how to grow red blood cells from stem cells, but it’s a costly and complex process that typically yields small amounts at a time. In November 2022, for instance, researchers in the U.K. successfully transfused about one or two teaspoons of manufactured blood into people as part of a clinical trial. 

Safi’s goal is to build on these advancements and produce large quantities of blood that could eventually be used commercially to help care for patients and avoid blood shortages. 

“People have tried, but the technology has evolved and we see this path now,” McConnell told CNBC in an interview. “I do think it goes from science fiction to science, but still a lot of work ahead. No question about that.” 

Safi has received more than $16 million to date from the U.S. Department of Defense, and that total could exceed $20 million by the end of the year thanks to an additional in-process grant. The company also recently announced an additional $5 million in seed funding led by J2 Ventures. McConnell said this combined financing will help support the company as it begins to work with regulators from the U.S. Food and Drug Administration.

The FDA has not cleared Safi’s technology for use, and the company has years of rigorous testing ahead in order to prove its red blood cells to be both functional and safe. The company will also have to demonstrate that its manufacturing process is up to par with the agency’s standards. 

“We need to show these are safe, we need to show they’re effective, that they’re doing their job: They deliver oxygen, they circulate in a way that’s comparable to a donor red blood cell,” McConnell said. 

Earlier this month, Safi began working with a manufacturer in Manchester, New Hampshire, called the Advanced Regenerative Manufacturing Institute (ARMI) to fine-tune its production process. McConnell said ARMI is part of an ecosystem that’s been receiving government funding to build out biomanufacturing capabilities in the U.S. 

Safi kicks off its production process with a “progenitor” cell, meaning an adaptable cell that can grow into different types. Progenitor cells come from stem cells inside bone marrow, and Safi turns them into red blood cells.

McConnell said growing red blood cells is almost like preparing a stew because it requires lots of different ingredients — the challenge, though, is figuring out the cheapest and most efficient recipe possible, as well as when to stir or agitate the stew and which ingredients can be substituted for less-costly alternatives.

The company is also engineering special recipes for specific patient populations, as some chronic transfusion patients need blood that is free from certain antigens. 

The cells grow by dividing or “doubling” when they are put through a bioreactor. McConnell said Safi spends a lot of time focusing on how many doublings it achieves during bioreactor runs because it’s a good indication of how efficiently it’s producing cells. The cells are filtered, and Safi is left with units, or bags, of blood that look the same as what would be collected from a donor. 

Safi projects it is currently able to produce one unit of blood for under $2,000. The company’s ultimate goal is to get costs down to under $500 or even $300 per unit, which is comparable to the price of donor blood, McConnell said. 

The median amount that U.S. hospitals paid for a unit of donated red blood cells was $214 in 2021, according to a report from the analytics firm Statista.

McConnell said Safi is currently able to use a 10-liter bioreactor that produces about one unit of blood per run. In eight or nine years, he said the company is hoping to use much larger tanks that will be able to generate around 100 units per run. This means just one stem cell donation could help produce hundreds of bags of blood.  

“It’s more than one person could donate in their lifetime,” McConnell said.

To make large-scale production a reality, Safi has a long road ahead. McConnell said the company’s first launch is likely six or seven years away, in part because it is targeting production of around 100,000 units of blood during its initial launch year. Safi plans to continue to scale until it’s manufacturing more than 1 million units annually, he added. 

McConnell said he doesn’t want doctors or patients to worry about access to blood, and he believes Safi can help fill those gaps. 

“It’s kind of crazy that we’re still tolerating this,” he said. “Honestly, one of the solutions is… to build our own supply chain.”