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With tariffs directly impacting the cost of fuel, energy, and vehicle production, the transportation industry faces an uncertain outlook.
On Friday, August 1st, President Donald Trump announced the imposition of new tariffs on dozens of countries. These measures will take effect on August 7th, as established by the president. The order adds to previously announced tariffs, which include a base rate of 10% for trade partners and 15% for countries without a signed trade agreement.
Although the U.S. president maintains that these tariffs will generate billions of dollars in revenue and are part of his strategy to boost domestic manufacturing, by encouraging companies to produce within the country to avoid taxes, there are already signs that the measure could come at a high cost for U.S. businesses.
With tariffs directly impacting the cost of fuel, energy, and vehicle production, the transportation industry faces an uncertain outlook. For this reason, Transport Topics consulted industry experts about the future of this sector in light of the new trade policies. Below is a summary of the conclusions shared by this specialized media outlet.
What do transportation experts think about the implementation of the new tariffs?
In an initial reaction to the new tariff changes, the transportation industry as a whole is working to understand how these measures will impact their operations. Mike Short, President of Global Forwarding at C.H. Robinson Worldwide Inc., stated that his customs team is already facing a heavy workload due to the increased activity related to trade policy.
Currently, C.H. Robinson is working closely with its clients to help them reduce their exposure to tariffs, an added task on top of the multiple responsibilities the company already handles on a regular basis.
On the other hand, Zeid Houssami, Senior Vice President and Global Head of Freight at Uber Freight, told Transport Topics that “timing is everything.” He explained that transportation companies must accelerate the movement of goods before higher tariffs spread throughout the sector. Houssami also recommended that carriers consider alternative routes or consolidations to control costs.
The tariffs are affecting all trade partners equally. Houssami warns that importers are approaching a critical point, as options to avoid these taxes have significantly diminished with the widespread application of the 10% tariff.
Meanwhile, Jenna Slagle, Senior Data Analyst at Project44, emphasized that companies must focus their efforts on mitigating the impact of tariffs, turning this task into a strategic priority, according to Transport Topics.
Transportation industries must prepare to survive in the new trade environment
A further delay or suspension in the implementation of additional trade agreements may still occur, as has been the case in recent months. However, with or without a pause, the transportation industry continues to face a scenario of uncertainty in light of the ongoing changes in trade policy and their potential consequences.
Industry experts noted that while these tariffs may represent a competitive advantage for U.S. manufacturers, they also bring financial pressure, higher costs, and an increasing risk of supply chain disruptions for companies that rely on imports. Therefore, it is crucial for businesses to review their strategies and accelerate plans to establish manufacturing operations within the United States.
Nonetheless, Michelle Comerford, Industrial and Supply Chain Practice Leader at Biggins Lacy Shapiro & Co., warned that tariffs do not guarantee that all companies will decide to relocate their production to the U.S. The real challenge, according to her, lies in effectively managing costs, timelines, supply continuity, and other associated risks.
The immediate effect of these measures will be an increase in prices, which could translate into a drop in demand. That’s why, now more than ever, transportation companies must strategically plan their next steps to adapt and survive in this new trade environment.
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