Many companies publicly appear to be adopting a wait-and-see approach to the looming risk of a tit-for-tat trade war. Yet beneath this surface-level calm, businesses are taking steps to mitigate potential disruptions. Western firms are rapidly accelerating plans to diversify their supply chains, especially for nearshore manufacturing, assembly, and distribution systems. European manufacturers remain especially vulnerable, as the sector has been contracting for nearly two years with no turnaround in sight, increasing pressure to protect domestic manufacturers from Asian imports.
In the U.S., where manufacturing accounts for just 12% of GDP, the greater concern is the potential revenue losses inside China from punitive actions – from sanctions to outright bans – and escalating trade tensions.
Drawing on our work with global companies across manufacturing, automotive, pharmaceuticals, semiconductors, software, technology, financial services, and a range of service industries, we outline the key actions companies are taking to navigate this period of heightened uncertainty.
We also provide critical context on the current state of global supply chains, which have emerged from 16 months of double-digit inflation following two years of pandemic-driven disruptions. In short, for the past six months, supply chains have been operating in a “Goldilocks zone,” with steady global manufacturing growth – except in Europe, where there is protracted weakness.
Download the whitepaper to see the 4 strategies to mitigate the impact of tariffs and stay ahead of disruptions.