3 takeaways from 2025’s tariff wars so far

The situation is still changing seven months since Trump first began redrawing tariff agreements. In August, China and the US agreed to another 90-day extension of their trade truce until 10 November.

This means that right now US tariffs on Chinese imports are 30%, while China has a 10% tariff on American goods. But the picture could be different again by the end of the year.

While nothing feels certain at present when it comes to global tariffs long-term, there are some things we can take away from 2025’s tariff wars so far.

1. Supply chain changes take time and money

One of the factors behind the US’ tariff increases on goods imported from many countries globally is a desire to increase the amount of domestic manufacturing. 

The smartphone sector in particular has been zeroed in on with Trump previously saying that he wanted any smartphones sold in the US to be manufactured there or the manufacturer would face a 25% tariff. 

In August, smartphone giant Apple confirmed that it will invest a total of $600 billion in the US over the next four years, which seemingly fits in with Trump’s vision. However, much of the investment seems to be focused on aspects of Apple’s business outside of its core smartphones and devices, such as a server manufacturing facility, data centre capacity increases, and a Manufacturing Academy for small-to-medium-sized businesses.

Likewise, while Apple says it plans to hire 20,000 people in the US over the next four years, the vast majority of these will be in roles outside of manufacturing, such as R&D, silicon engineering, software development, and AI and machine learning.

Earlier this year, Apple’s Tim Cook said that Apple was moving production of its products for the US market away from China, but seemingly not to the US. The majority of iPhones that will be sold in the US will be manufactured in India, and other products like iPads and Apple Watches will be produced in Vietnam.

This shift was already underway before Trump’s tariffs given that one new Apple partner manufacturing facility in India began producing iPhones  in April with another coming online not long after. In fact, Apple has been diversifying its supply chain into India since 2017. This is possibly due to tensions in the US-China trade relationship that arose during Trump’s first term as US President through the administration’s concerns about trade imbalances.

The reality is that new manufacturing facilities require significant investment and can take years to build. Even shifting production from a well-established manufacturing hub like China to one like Vietnam or India still takes considerable time and research to ensure quality, capacity, and knowledge. 

And while moving from one overseas manufacturing hub to another is a costly exercise in itself, for companies to reshore their supply chain to the US, they need to be confident that policies are long-term – something that hasn’t been seen so far with the on-off nature of Trump’s tariffs.

2. Skilled labour is an issue

Manufacturing has come a long way since the heyday of US production. The workforce in manufacturing hubs like China, Vietnam and India are highly skilled, undertaking specialised production processes.

Moving production to the US or other Western countries is challenging in part because this same specialist workforce doesn’t exist. Particularly not at the scale required by major manufacturing facilities.

Expertise and knowledge that has taken years to accumulate can’t just be transplanted to another location. At the same time, wages are higher in countries like the US which would make it cost-prohibitive to employ large numbers of skilled employees.

It's probable then that any companies looking to move a significant portion of their manufacturing to the US would need to invest in more automation to bridge the skills gap. This could mean that designs have to change to make them easier for robotics to put together.

One example of a company that has moved production of US-bound products from India to the US is smart ring maker Ultrahuman. Automation of more tasks has been necessary to keep labour costs down, alongside workers who have been trained in multiple areas of the production process so that more can be done with fewer people.

However, as a smaller company Ultrahuman isn’t dealing with manufacturing at the scale of major global brands.

What’s also interesting is that past experiments by these big name brands to reshore US manufacturing in particular haven’t gone well. In 2015, Nike opened a production facility in Mexico that used automation to reduce the number of human workers required. However, the experiment ultimately failed as tasks proved difficult to automate and the number of human workers increased significantly, driving up staff costs.

3. Adaptability has become a tentpole of the supply chain industry

The 2025 tariff wars have shone a stark light on just how global supply chains are. Even products that are branded ‘Made in America’ are often actually just assembled in the country from parts that are made and imported from overseas.

We live in an interconnected world, and this is reflected in our supply chains. And this makes it incredibly difficult to take the supply chain for a product and end-to-end move it to another country – certainly without great time and expense.

One thing that Trump’s tariff reforms have done is make US consumers in particular, but also the wider world, more aware of where the products they buy come from. Although this is creating challenges for businesses trying to work out pricing as they take on new tariff costs, it is also seeing them get creative with their supply routes.

This includes things like importing directly into markets like Canada that previously they may have supplied from the US, and looking for new global markets to sell into to reduce exports to the US. Other companies are diversifying their sourcing by working with suppliers from a number of different regions for more favourable tariffs.

Businesses working on small run, limited products, such as consumer-backed board game launches on Kickstarter, have paused production and/or shipping to the US while waiting for confirmation on tariffs. By choosing the right moment to ship, these small businesses have avoided being hit with tariffs of up to 145%.

While it’s incredibly hard to predict what the US tariff situation will look like in three months, six months or 12 months’ time, arguably the supply chain industry has never been better equipped to deal with what comes next having had to become more adaptable off the back of the Covid-19 pandemic and various geopolitical tensions.

This flexibility and ability to innovate will be vital as the world waits to see where the dice finally falls on tariffs.