News of tariffs has filled headlines and instilled some concern amongst business leaders nationwide. Numerous tariffs have been announced - and the American economy is bracing itself for possible repercussions.

Supply chains are particularly vulnerable to tariffs due to the far-reaching impacts of these rulings. That said, logistics, manufacturing, and other companies should work to understand how upcoming tariffs will specifically impact their supply chains. But first, let’s cover the basics. 

What is a Tariff?

In short, a tariff is a tax that a country’s government places on products imported from another country - generally raising the price of those imported products. Ultimately, tariffs are a percentage of the value of the import. 

For example: A 25% tariff on a $10,000 shipment of products comes out to $2500, which is generally paid by the business importing the product or the consumer.

Why do Tariffs Occur?

Tariffs result from various political, economic, and/or strategic motivations - ultimately influencing broader trade and economic policies.

A recent example includes the U.S. - China Trade War Tariffs from late 2018 to early 2020. The tariffs originated as a method to address trade imbalances and encourage domestic manufacturing, which resulted in heavy tariffs between the U.S. and China that affected a range of products from steel and electronics to food and clothing. These tariffs eventually led to significant shifts within supply chains, increased consumer costs, and long-term changes in global trade dynamics. 

Supply Chain Lessons from 2020  

Professionals should look at the major shifts and disruptions that occurred in 2020 as clues to what may transpire. Major impacts include: 

• Shortages of goods and parts: The lockdowns in China led to large-scale global shortages of various goods and parts. 
• Shipping port shortages and delays: Major shipping ports throughout Asia, Europe, and the U.S. either slowed or shut down, causing backlogs. 
• Shortage of workers: Sickness, lockdowns, and safety protocols lead to reduced labor across warehouses, trucking, and manufacturing industries. 
• Panic buying: A significant rise in demand for essential items like toilet paper and canned goods led to emptied shelves for prolonged periods. 

Virtually every industry was impacted severely, leading companies to adopt a strategy focused on”‘resilience” rather than “efficiency”. 

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Adopting a strategy of resilience  

A strategy of resilience entails preparing an organization for any disruptions that may occur, and being able to bounce back quickly when things go wrong. As the effects of tariffs occur and markets become unpredictable, resilience becomes a competitive advantage that companies can’t afford to overlook. 

Examples of a modern, resilient strategy for companies includes: 

‍1. Diversified Supply Chains

Companies should reduce their reliance on any single source or supplier. It’s beneficial to have backup vendors and to implement contingency plans for critical suppliers. 

‍2. Flexible Manufacturing and Operations

Investing in adaptive production lines can help companies shift to new products or suppliers. It’s also helpful to cross-train employees so they can adapt to various roles during any possible staffing shortages. 

‍3. Strategic Inventory Management  

Having emergency supplies  stocks of crucial supplies is important to have on hand, in case disruptions or other issues lead to shortages of these items. 

‍4. Scenario Planning and Stress Testing

What happens if your top supplier shuts down? What if there’s strikes at your nearest shopping port? What if you’re hit with a major cyber attack? These are the types of questions that business leaders should ask themselves to best prepare for any ‘worst case scenarios’. 

With news of these upcoming tariffs, it may be best for companies to adopt a strategy of resilience so they’re prepared for any possible scenarios. 

Security Implications  

Tariffs can lead to widespread ramifications, including threats of internal and external violence for companies.It’s important for companies to proactively address concerns and threats of possible violence to protect their employees, customers, their premises, and various company assets. Rising concerns include threats of: 

‍1. Possible Increase in Theft

Tariffs can lead to issues, like job instability, that can have significant societal implications. Specifically, theft can rise as people search for alternative forms of income. This issue is especially pronounced within categories where the price of goods is changing drastically (e.g. cars). Investments in security technology are increasingly becoming the best option for companies searching for a modernized solution to address ongoing thefts and threats of violence.

For example: Security technology, like License Plate Readers (LPR) Cameras, can create a virtual security perimeter around your premises and immediately alert security staff or law enforcement whenever a known offender enters. It’s also effective in collecting actionable evidence that security staff and police can use to identify and prosecute known offenders. ‍

2. Corporate Threats

Tariff-driven job instability, pay cuts, job relocation, and other issues can lead to possible threats being made against public-facing corporate leaders and employees. These threats are significant if your company receives much public attention or scrutiny. A well-known example lies with the death of UnitedHealthcare CEO Brian Thompson, which shows the threat that companies may face during times of economic instability. For solutions, read our blog focused on corporate security to better understand how to circumvent this issue and best address executive protection. 

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Recent Tariffs and How They May Impact Supply Chains  

Tariff

​On April 2, 2025, The White House announced a comprehensive tariff strategy that’s been termed as "Liberation Day”. This initiative introduces a two-tiered tariff system to address trade imbalances and promote domestic manufacturing. Key aspects of the “Liberation Day” tariffs include: 

Universal Baseline Tariff 

A 10% tariff applied to all imports into the United States, with the exception of goods from Canada and Mexico.

Country-Specific "Reciprocal" Tariffs  

Additional tariffs imposed on approximately 60 countries calculated based on perceived unfair trade practices. Notable rates include:

• China: 34% (on top of the preexisting tariffs)
• European Union: 20%
• Japan: 24%
• South Korea: 25% 
• India: 26%
  

Elimination of De Minimis Threshold:

• The $800 de minimis threshold for duty-free imports from China was eliminated, with plans to extend this removal to other countries as administrative capacities allowed, effective May 2, 2025

What to Expect 

1. Rising Costs for Businesses and Consumers 

Tariffs are essentially a tax on imports, and businesses typically pass these costs over to consumers.

Expected Impact 

• Electronics, apparel, and footwear
• Food and wine from Europe
• Auto parts and foreign vehicles
• Machinery, tools, and raw materials

Tariff Security Implications 

• If prices for basic consumer goods rise - commercial businesses may experience rising rates of shrinkage and theft, which generally also equals higher rates of violence and aggression from offenders. 
• If prices rise, commercial businesses will need to implement modern security technology that’s capable of deterring and addressing modern threats like organized crime rings. 
• Modern security technology examples include Flock Safety LPR Cameras that can proactively deter offenders whilst providing actionable evidence to security personnel and/ or law enforcement.  

Tariff 

The recent 25% U.S. tariffs on imported vehicles and automotive parts—particularly those from Mexico, Canada, the EU, and China—will have major implications for America's automotive supply chain. This sector is one of the most globally integrated so that the impact will be felt across production, pricing, labor, and logistics.

What to Expect

1. Global Supply Chain Rebalancing

With the introduction of these tariffs, automakers may try to bypass these tariffs by: 

Expected Impact

• Automakers may move production to tariff-free countries and invest more in Southeast Asia, Eastern Europe, or the Southern U.S. However, it should be noted that this rebalance will likely take place over the next few years. 

2. Higher Production Costs for U.S. Automakers ‍

U.S. car manufacturers (like Ford, Tesla, and GM, Tesla) rely heavily on imported components, especially from Mexico and Canada, under the USMCA trade deal.

Expected Impact 

• 25% tariffs dramatically raise the cost of imported engines, transmissions, electronics, and other key parts
• These costs will either be passed to consumers (raising car prices) or absorbed by companies, squeezing profit margins

3. Price Increase on Vehicles 

Brands that import cars, like BMW, Audi, Toyota, and others, will increase sticker prices to offset these tariffs. Even vehicles assembled within the U.S.still include several parts from abroad, so these brands will also be affected. 

Expected Impact

• Consumers can expect increased prices for both new and used vehicles
• There will also be a decrease in consumer demand, especially in the mid-tier and luxury segments

4. Manufacturing Disruptions & Reconfigurations 

Many car assembly plants rely on just-in-time delivery of parts from Mexico and Canada. For reference, just-in-time delivery refers to “a strategy where goods are received from suppliers only as they are needed, minimizing inventory costs and waste by aligning production schedules with delivery schedules”. 

Expected Impact 

• These tariffs could force automakers to:
  
  • Stockpile parts (raising inventory costs)
  • Shift suppliers, possibly to the U.S. or Asia 
  • Reconfigure production lines to accommodate changes in parts availability

5. Supply Chain Delays & Logistics Strain

Border crossings with Mexico are critical to the auto supply chain. These new tariffs can introduce time-consuming restraints in the form of:

• Customs checks
• Paperwork
• Delays at ports of entry

Expected Impact 

• Slower supply chains 
• Increased freight costs 
• Higher risk of line stoppages at U.S. auto plants

6. Job Market & Labor Shifts 

The pressure from these tariffs could have far-reaching impacts on various industries across the automotive market. 

Expected Impact

In the short term, tariff pressure may lead to layoffs at car dealerships, part suppliers, and/ or manufacturing plants. In the long term, some production efforts may be restored to the U.S., creating jobs. However, these jobs will likely be automated and not labor-intensive. 

Tariff Security Implications

• Managing a shifting or more complex delivery could lead to security gaps as personnel are exposed to unfamiliar schedules, new sources, and more. 
• Some companies may choose to stockpile parts for fear of rising costs, making them more vulnerable to theft. This entails investing more in security solutions that proactively protect these higher-value assets. 
• Solutions like Flock Safety’s Mobile Security Trailers can secure restricted areas during unauthorized times with its bold design and flashing blue lights that immediately lets offenders know they’re being watched. They also send 24/7 real-time alerts whenever an unusual person or vehicle enters their premises.     

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Tariffs

On February 1, 2025: President Donald Trump signed executive orders imposing 25% tariffs on all imports from Mexico and 25% tariffs on all imports from Canada, with a 10% tariff on Canadian oil and energy exports. These tariffs were enacted under the International Emergency Economic Powers Act (IEEPA) and took effect on March 4, 2025. 

What to expect 

1. Automotive Industry Disruptions‍

Mexico and Canada are deeply integrated into the North American auto supply chain. Many U.S.-branded vehicles are built using parts sourced from or assembled in these countries.

‍Expected impact:

• Higher vehicle production costs in the U.S
• Rising car prices, especially for brands like Ford, GM, BMW, and Audi (which manufacture in Mexico/Canada)
• Pressure to shift production back to the U.S.—but that takes time and investment

2. Manufacturing & Raw Materials

Canada supplies many raw materials (aluminum, steel, oil, and lumber) that are crucial for U.S. manufacturing and construction. Mexico is also a key supplier of electronics, textiles, auto parts, and machinery.

‍Expected impact: 

• Increased input costs for U.S. factories
• Disruptions in production schedules
• Need to find alternative suppliers, which may be more expensive or slower

3. Consumer Goods & Retail

Many everyday goods (like appliances, clothing, produce, and packaged food) come from Mexico and Canada.

‍Expected impact: 

• Higher prices for groceries, household goods, and electronics
• Potential shortages of seasonal produce from Mexico (e.g., avocados, tomatoes)
• Inventory delays for big-box retailers (Walmart, Target, etc.)

4. Energy Supply Chains

Canada is the top foreign supplier of oil and natural gas to the U.S., so a 10% tariff on Canadian energy exports will impact various areas within our supply chain.

‍Expected impact: 

• Raise fuel and utility costs
• Impact U.S. refineries that depend on Canadian crude
• Lead to sourcing shifts or price volatility in the energy market

Tariff Security Implications

• Higher costs for consumer goods may lead to increased rates of theft for these items. Security technology solutions like Flock Safety’s LPR cameras can assist within these areas. 
• Utility companies should invest more to ensure their increasingly valuable materials and utilities are secured. This can be achieved with security technology like LPR cameras that can proactively stop crime on their premises. 
• Learn more about how LPR cameras can create safer environments for utility companies by reading Flock Safety’s case study: Helping a Utility Company Deter Violent Crime and Keep Employees Safe‍

Tariffs

On February 1, 2025: The U.S. imposed an additional 10% tariff on Chinese imports, supplementing existing tariffs of up to 25% on many Chinese goods. This action aimed to address trade imbalances and concerns over intellectual property rights.‍

What to Expect  

1. Electronics & Technology‍

China is widely known as the global hub for electronics manufacturing, which includes smartphones, laptops, batteries, and semiconductors.

Expected impact: 

• Increased costs for tech companies and consumers
• Disruptions in sourcing components like chips, displays, and lithium-ion batteries
• Companies like Apple, Tesla, and HP may look to shift production to India, Vietnam, or Mexico, but that takes time

2. Industrial Machinery & Equipment

Many U.S. manufacturers rely on Chinese-made tools, robotics, and machinery components. 

Expected Impact:   

• Higher costs for U.S. manufacturers
• Delays in production lines due to sourcing challenges
• Small-to-medium manufacturers will feel the pinch the most

3. Apparel, Footwear, and Consumer Goods

China supplies a huge share of U.S. clothing, footwear, toys, and household items.

Expected Impact:

• Retailers like Walmart, Target, and Amazon face rising wholesale prices.
• Potential price hikes on shelves.
• Brands may shift sourcing to Bangladesh, Vietnam, or Latin America, slowly.

4. Logistics and Inventory Management

Companies that rely on Chinese goods may begin stockpiling relevant items before more tariffs are put in place to save money on these additional tariffs. 

Expected impact:  

• Warehousing costs increase
• Shipping timelines may be affected as supply routes shift 
• Some companies may find it beneficial to adopt “just-in-case” inventory models instead of lean “just-in-time” methods

Tariff Security Implications  

• Retailers that sell electronics and technology (Walmart, Best Buy, Costco, etc.) may experience a rise in theft due to the rising costs and value of their products. To protect their customers, staff, and assets, these stores may implement security technology solutions like LPR cameras and Mobile Security Trailers. 
• Companies may stockpile items necessary for their operations, which adds concerns of possible theft and attracting potential offenders. 
• Supply chain malware incidents are also a concern for companies shifting suppliers and forming unfamiliar business partnerships.  

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Tariffs

The U.S. reinstated and expanded tariffs on steel and aluminum imports, applying a 25% tariff on these materials from all countries. Commerce Secretary Howard Lutnick stated the goal was to nurture "a big, strong domestic steel and aluminum capability." 

What to Expect

1. Higher Costs for Manufacturing and Construction 

Steel and aluminum are heavily used in construction and are foundational materials for buildings, machinery, cars, planes, various appliances, packaging, and more. 

Expected Impact:  

• Construction companies will likely face higher input costs - leading to more expensive infrastructure, commercial buildings, and homes.
• Manufacturers of goods that utilize steel and aluminum appliances will likely see their profit margin decrease or will pass costs off to consumers.
• These tariffs may have farther reaching impacts than most would expect. For example, beer and soft drink companies could end up paying more due to higher costs associated with aluminum cans.

2. Heavy Impacts within the Automotive Industry

Cars and trucks both use large amounts of steel and aluminum within their vehicles.  

Expected Impact: 

• U.S. automakers face higher production costs, especially for trucks and SUVs
• Imported parts and vehicles will also get pricier and potentially raise costs for consumers
• Companies may also shift sourcing or automation to offset costs

3. Aerospace Sector 

Similar to cars and trucks, aircraft manufacturing is heavily reliant on aluminum.

Expected Impact:

• Aircraft costs rise, pressuring profitability and international competitiveness
• Long-term contracts may be renegotiated to reflect the higher material costs

4. Supply Chain Delays & Disruptions

In response to tariffs, impacted companies will likely focus on re-routing supplies to other sources without tariffs. 

Expected Impact:

• Companies may face delays in receiving essential materials
• Increased demand from domestic mills could lead to backlogs or shortages if U.S. producers can't meet volume needs quickly
• Smaller manufacturers, which rely on imported specialty metals, may struggle more than large ones

5. A Boost for Domestic Producers  

A positive for U.S. steelmakers and aluminum producers is that they could potentially see substantial short-term gains due to reasons like:

Expected Impact:  

• More demand for domestic output
• Rising share prices and expanded production

Though, it’s important to note that domestic capacity may not be able to scale quickly, creating temporary shortages and price spikes.

6. Global Trade and Retaliation Risks 

Various trading partners may respond with their tariffs on U.S. exports. This could lead to major implications for supply chains like: 

Expected Impact: 

• Risk of trade disputes escalating
• U.S. exporters could lose access to international markets, especially if allies retaliate

Tariff Security Implications

• Higher construction costs will leave construction sites more vulnerable to theft as their tools and materials increase in value. Tools like Mobile Security Trailers can help secure construction sites and deter potential offenders and other threats. 
• Automotive and aerospace manufacturing will also be more vulnerable to theft due to rising costs and prices. 

Tariffs

On February 26, 2025: President Trump announced plans to impose a 25% tariff on goods imported from the European Union, citing concerns over trade imbalances and the need to protect American industries. The European Union has indicated potential retaliatory measures in response.

What to Expect 

1. Automotive Supply Chains

The EU is a major exporter of high-end cars and car parts like BMW, Mercedes, Audi, and Volkswagen.

Expected Impact:

• Prices on imported luxury and performance vehicles can rise
• U.S. auto dealers could face inventory delays and demand drops 
• Parts for repairs and servicing of EU vehicles may become pricier or harder to source 

2. Aerospace & Industrial Equipment

Companies export specialized aircraft components, turbines, robotics, and industrial tools to the U.S.

Expected Impact:  

• Aerospace manufacturers and airlines that rely on EU-made parts could face delays or pricey cost hikes
• Manufacturing sectors that depend on European precision machinery may be forced to find alternative suppliers

3. Food, Wine, and Luxury Goods 

EU countries export a massive amount of wines, cheeses, chocolates, olive oil, perfumes, and fashion.

Expected Impact:

• Tariffs will raise prices on imported gourmet and luxury items
• Restaurants, retailers, and specialty grocers will face tighter margins and fewer choices
• U.S. wineries and producers may benefit slightly from reduced competition—but supply chains will need time to adjust

4. Manufacturing & Energy Tech  

The EU is a major supplier of clean energy technologies, including wind turbine components, advanced batteries, and EV parts.

Expected Impact:  

• U.S. clean energy projects could face increased costs and project delays
• Companies investing in renewable energy may need to pivot sourcing or delay rollouts

5. Logistics & Re-Sourcing Challenges 

These tariffs may ultimately prompt some companies to take actions like: 

Expected Impact:

• Rethink supplier relationships
• Shift sourcing to non-EU countries
• Reshore production where possible—but with higher costs and longer timelines

Tariff Security Implications

• Like other industries, dealers and mechanics that repair and service EU vehicles may find it beneficial to invest in security solutions that can deter thieves and other offenders looking to take advantage of these higher prices. 

Tariffs

March 2025: President Trump announced a 25% tariff on all imports from countries purchasing oil or gas from Venezuela, citing geopolitical concerns and the need to pressure the Venezuelan government. This move could affect nations like China, a significant importer of Venezuelan oil.

What to Expect

1. Volatility in Global Oil Markets  

While the U.S. imports very little oil directly from Venezuela, many U.S. trading partners (like China and India) still do. The U.S. tariff effectively penalizes countries for buying Venezuelan oil, creating friction in global oil flows.

‍Expected Impact:

• Potential tightening of global oil supply
• Price volatility in crude and refined products (like gasoline, jet fuel, and diesel)
• U.S. refiners may face rising input costs as suppliers shift and prices fluctuate

2. Strain on U.S. Refining Supply Chains

Venezuela traditionally supplied heavy crude, which certain U.S. refineries are optimized for. Even with reduced direct imports, tariffs limit any flexibility in sourcing heavy crude oil from the region.

Expected Impact:  

• U.S. refineries might rely more heavily on Middle Eastern or Canadian heavy crude, increasing transport and processing costs
• Any shocks to supply in Canada (who’s already facing tariffs) could compound any existing issues related tariffs

3. Maritime Logistics and Shipping

Countries importing Venezuelan oil may re-route energy trade, changing tanker routes and shipping availability.

Expected Impact:

• Congestion or bottlenecks at ports as trade flows shift
• Possible increased insurance or risk premiums for ships navigating politically tense regions

4. Strategic Supply Chain Recalibration 

Energy-dependent industries may try to minimize losses against higher fuel and shipping costs by:

Expected Impact:

• Reducing transportation reliance and using local suppliers
• Investing in energy efficiency and fuel alternatives
• Building up inventories in anticipation of fuel price hikes

Tariff Security Implications

• Fluctuations in fuel costs and altered suppliers may lead to security gaps in transportation and less vetting of new vendors. 
• Companies that stock up on inventory will have to emphasize protecting their premises proactively, deterring any potential offenders.
• Supply chain malware incidents are also a concern for companies shifting suppliers and forming unfamiliar business partnerships.  

Check back often for new tariffs 

Bookmark this page and be sure to return periodically for information regarding new tariffs as they’re added, including the expected economic impact . 

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