{"id":1507131,"date":"2024-12-10T17:05:00","date_gmt":"2024-12-10T22:05:00","guid":{"rendered":"https:\/\/bugaluu.com\/news\/?p=1507131"},"modified":"2024-12-10T17:05:00","modified_gmt":"2024-12-10T22:05:00","slug":"trumps-tariffs-could-spark-supply-chain-disruptions-experts-say","status":"publish","type":"post","link":"https:\/\/bugaluu.com\/news\/trumps-tariffs-could-spark-supply-chain-disruptions-experts-say\/1507131\/","title":{"rendered":"Trump’s Tariffs Could Spark Supply Chain Disruptions, Experts Say"},"content":{"rendered":"

Trump’s Tariffs Could Spark Supply Chain Disruptions, Experts Say<\/span><\/p>\n

\n

By Noi Mahoney of FreightWaves<\/em><\/p>\n

President-elect Donald Trump\u2019s plan to hit imports from China, Canada and Mexico with tariffs could deal a blow to companies across North America and trigger negative consequences for the global supply chain, according to experts.<\/p>\n

<\/a><\/em><\/p>\n

Trump said that on his first day back in office on Jan. 20, he will impose 25% tariffs on goods from Mexico and Canada. The tariffs are aimed at pressuring those countries to stop drugs and illegal migrants from crossing into the U.S., Trump posted on Truth Social<\/a> on Nov. 25. He has also said he\u2019ll impose an additional 10% tariff on Chinese imports to fight drugs coming from that country.<\/p>\n

Sri Laxmana, vice president of Americas at freight broker and 3PL giant C.H. Robinson<\/a>, said the company began hearing from concerned customers as soon as Trump made the announcement.<\/p>\n

\u201cWe\u2019ve been pulled into countless customer meetings to run risk scenarios for if Canada and Mexico tariffs were implemented,\u201d Laxmana told FreightWaves in an email. \u201cMany of our customers \u2014 especially in the automotive space \u2014 treat North America as one integrated supply chain with some of their freight actually crossing both the Mexico and Canada borders.\u201d\u00a0<\/p>\n

<\/a><\/p>\n

Many of Trump\u2019s foreign policy measures are part of his broader \u201cAmerica first\u201d approach, which began during his first term in office.<\/p>\n

In 2018, the Trump administration imposed tariffs on $250 billion in Chinese goods coming into the U.S., covering items such as microwaves and other home appliances, electronic components, and pumping and valve systems.<\/p>\n

China retaliated with higher tariffs on $60 billion in U.S. goods coming into that country, with U.S. soybeans taking one of the biggest hits.<\/p>\n

During his 2024 presidential campaign, Trump said fentanyl from China is being smuggled into the U.S. and the additional 10% tariffs are aimed at spurring Chinese officials to stop the flow of drugs.\u00a0<\/p>\n

The 10% duty on Chinese goods is less than the 60% tariffs on China-made imports that Trump promised during his presidential campaign.<\/p>\n

Andy Sherman, the general manager for Fictiv\u2019s U.S. operations, said the company has been hearing from customers concerned about the tariffs and its effect on the global supply chain.<\/p>\n

Fictiv<\/a> is a manufacturing technology company based in San Francisco. It has operations in the U.S., Mexico, China and India. Fictiv has manufactured more than 30 million commercial and prototype parts for both early stage companies and large enterprises.<\/p>\n

\u201cI think in 2023, 11% of the U.S. gross domestic product was imported. That\u2019s about $3.1 trillion worth of imports in 2023,\u201d Sherman told FreightWaves in an interview. \u201cIf we\u2019re talking about tariffs around 10% to 20% on all countries, and somewhere in the order of magnitude of 60% tariffs on what\u2019s going to be coming inbound from China \u2026 that\u2019s a significant chunk of the U.S. GDP that all of a sudden is going to be subject to tariffs. I think for many of our customers, they are able to see the importance of having a highly agile supply chain and starting to be able to evaluate what makes sense to move to a China-plus-one strategy, or to be able to onshore. But tariffs across the board like this do not necessarily equate to, \u2018Let\u2019s move everything into the U.S.\u2019 That\u2019s not the way this works.\u201d<\/p>\n

Sherman said products that could be most affected by tariffs include clothing, toys and other consumer goods.<\/p>\n

\u201cWhen you\u2019re talking about things like apparel, when you\u2019re talking about things like toys, when you\u2019re talking about many lower-cost or cost-sensitive goods that are very frequently manufactured out of China and where suppliers or some subset of manufacturers have not yet diversified that supply chain out of China, we know that those are the products that are going to be most heavily impacted,\u201d Sherman said. \u201cAt the end of the day, if there\u2019s a 60% tariff, that\u2019s going to be passed along to the consumer, more than likely, in its entirety.\u201d\u00a0<\/p>\n

Sebastien Breteau, founder and CEO of QIMA<\/a>, said Trump\u2019s tariffs and immigration policies will raise prices for consumer goods.<\/p>\n

Trump promised during his campaign that his immigration policy includes carrying out the largest mass deportation program in U.S. history.\u00a0<\/p>\n

\u201cA mass deportation of undocumented immigrants could severely impact sectors like agriculture, construction, and manufacturing that rely heavily on immigrant labor,\u201d Breteau told FreightWaves in an email. \u201cReduced labor availability would lead to higher wages, raising production costs and, ultimately, the price of goods. This would exacerbate inflationary pressures already heightened by tariffs.\u201d<\/p>\n

Hong Kong-based QIMA is a quality and compliance solutions provider, working with 30,000 brands, retailers, manufacturers and food growers globally. The company employs over 5,000 people worldwide, operating in more than 100 countries.<\/p>\n

Breteau said Trump\u2019s tariffs could pressure companies to shift their supply chains, which could add more costs to their bottom line.\u00a0\u00a0<\/p>\n

\u201cIncreased tariffs will compel businesses to reassess their supply chains, a process that is both complex and costly,\u201d Breteau said. \u201cIn the short term, this is likely to result in delays, increased logistics costs, and higher prices for consumers. While diversification efforts have been ramping up, no single country can absorb the scale of manufacturing currently managed by China.\u201d<\/p>\n

North American brands and retailers have been shifting their supply chains to China\u2019s neighbors in Asia, Breteau said.\u00a0<\/p>\n

\u201cThe greater Asia region\u2019s share has grown from 35% in 2018 to 47%, with India and Vietnam emerging as clear winners, collectively increasing their share of U.S. sourcing from 14% to 22% during this period,\u201d Breteau said.<\/p>\n

<\/a><\/p>\n

Another part of the supply chain that could be affected by Trump\u2019s proposed tariffs is the e-commerce logistics industry, said Sylvia Ng, CEO of ReturnBear.<\/p>\n

Toronto-based ReturnBear<\/a> is a cross-border reverse logistics platform with a mission to make e-commerce returns simpler for shippers and customers, while reducing fraud and landfill waste.<\/p>\n

\u201cRecent events have made it harder for merchants to be managing profitability, which makes the returns process to actually even play a bigger role in their operations than before,\u201d Ng told FreightWaves in an interview. \u201cThe potential Trump tariffs is one of the things that merchants have to think about. But even before that, you have the dock workers strikes<\/a> that have been kind of rolling through the U.S. and Canada<\/a>. In Canada, we have a postal workers strike that\u2019s been going on for a whole week now and it\u2019s affecting a lot of merchants that are based in the U.S.\u201d<\/p>\n

Workers for the Canada Post, the country\u2019s national mail carrier, have been on strike since Nov. 15, citing failed contract negotiations between the postal service and the Canadian Union of Postal Workers.<\/p>\n

Key negotiation points between the postal service and the union include wages, safety and automation in the workplace.<\/p>\n

\u201cObviously, if you are selling from the U.S., you might not know that these things are happening in a different market,\u201d Ng said. \u201cThen you add on the potential tariffs and I just feel like there\u2019s a lot going on in the macro economic space right now that the merchants are having to deal with alongside the holidays.\u201d<\/p>\n

The global reverse logistics market was valued at $769 billion worth of goods in 2023, according to Fortune Business Insights<\/a>.<\/p>\n

ReturnBear was founded in 2021. The platform gives shippers access to more than 1,000 package-free, label-free return drop-off locations across Canada. The company also has hubs in the U.S. in Portland and Buffalo, and recently launched operations in the United Kingdom.\u00a0\u00a0<\/p>\n

Ng said Trump\u2019s proposed tariffs could hit small and medium-sized (SMBs) e-commerce retailers the hardest, companies that have already been impacted by lower sales due to inflation.<\/p>\n

\u201cUnfortunately, the tariffs\u2019 impact is going to be higher on SMBs,\u201d Ng said. \u201cSMBs don\u2019t have the bandwidth or the extra resourcing to be handling all this change. The National Retail Federation<\/a> has also predicted that American consumers are going to lose $78 billion annually in spending power due to these new tariffs, things like apparel, toys, furniture, footwear, travel. My concern is actually making sure that we help the SMB and mid market merchants to roll with these punches as much as we can and help them alleviate the need for them to pass on more cost to the consumers.\u201d<\/p>\n<\/div>\n

Tyler Durden<\/a><\/span>
\nTue, 12\/10\/2024 – 12:05<\/span><\/p>\n

\u200bhttps:\/\/www.zerohedge.com\/economics\/trumps-tariffs-could-spark-supply-chain-disruptions-experts-say<\/a>\u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"

Trump’s Tariffs Could Spark Supply Chain Disruptions, Experts Say By Noi Mahoney of FreightWaves President-elect Donald Trump\u2019s plan to hit imports from China, Canada and…<\/p>\n","protected":false},"author":0,"featured_media":1507132,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-1507131","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","wpcat-1-id"],"_links":{"self":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts\/1507131","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/comments?post=1507131"}],"version-history":[{"count":0,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts\/1507131\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/media\/1507132"}],"wp:attachment":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/media?parent=1507131"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/categories?post=1507131"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/tags?post=1507131"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}