How Tariffs, Cyber Attacks, And AI Are Rewiring Supply Chains

Tariffs promise protection but often deliver scarcity and higher prices. We break down what a 25% duty on imported trucks really means for fleets, freight rates, and the prices that hit your wallet. Along the way, we connect the dots to a different kind of shock: how a single cyber attack at Jaguar Land Rover rippled through thousands of suppliers and nudged UK GDP negative for the month, turning a “supply chain glitch” into a national economic problem.

We zoom out with fresh survey data from European operators who are done waiting for stability. The new playbook is clear: diversify sourcing across regions, deepen partnerships with logistics providers, invest in real-time visibility, and pre-plan alternate routes. That shift trades lowest unit cost for option value—and it’s paying off when geopolitics and trade rules change on a dime. We also examine where sustainability meets execution: reuse and refill initiatives, recycled content ceilings, and the frustrating store-level gaps that block consumers who actually want to help.

On the risk front, we unpack why pharma tariffs are uniquely dangerous—driving shortages, forcing expensive regionalization, and swelling inventory that demands more warehousing. Then we chart cooling TEU volumes during what should be peak season, the front-loading hangover, and why tariffs aren’t a faucet you can turn on and off without long delays and unintended consequences. Finally, we look at uranium’s return to the U.S. critical minerals list as nuclear gains momentum, powered by AI’s appetite for reliable baseload energy. The big strategic trade-off emerges: do we keep building physical warehouses to fight volatility, or invest in data centers and AI to shrink buffers with smarter flow?

If you care about resilience, cost, and sustainability living in the same network, this conversation lays out the moves that work and the pitfalls to avoid. Follow and subscribe for our upcoming deep dive on AI in supply chains and a conversation on on-demand 3D-printed parts that cut stock without cutting service. Enjoy the episode? Share it with your team and leave a quick review—it helps more operators find the signal.

Chapters

• 0:16 Tariffs On Imported Trucks
• 1:58 Inflation From Vehicle Shortages
• 3:17 JLR Cyber Attack And GDP Impact
• 6:32 Geopolitics And Supply Chain Strategy
• 9:52 Reuse, Refill, And Plastic Pact
• 15:39 Tariffs Disrupt Pharma And Retail
• 19:04 U.S. Import Slowdown And TEU Trends

Transcript

Tony Hines: 0:16

Subscribe to Chain Reaction you'll be first to know when new episodes are out and you'll never miss an episode. There was an interesting piece of news I came across this week reading Logistics magazine, and it said that forty-three percent of medium and heavy duty trucks sold in the USA are imports, and it's prompted the US government to introduce tariffs of 25% starting on the first of November. So what does that mean? It probably means there's going to be a truck shortage. People aren't going to be able to purchase the trucks that they want to upgrade their fleets. It's very odd, isn't it? All this tariff regime seems to be shooting yourself in the foot. It's supposed to be about protecting homemade goods. But if you can't get the goods, and if there's a shortage, which is artificial because it's caused by a tariff, what's going to happen? Well I'll tell you prices are going to go up, and the cost of those vehicles will rise. And what happens when the cost of vehicles rise? Yeah, you've guessed it. It means that the goods that those vehicles carry on board the vehicle are gonna go up too. So it's inflationary. A big dose of inflation coming down the road. Now you'll remember a few weeks ago we had a problem, a cyber attack on Jaguar Land Rover in the United Kingdom. And it caused chaos for Jaguar Land Rover and its large number of suppliers, and particularly those small and medium size suppliers. And it was reported here on Chain Reaction about how the attack took place and the damage it did to the JLR supply chain. Well, hopefully things are getting back on track right now. But that damage, guess what? It also caused damage to the UK economy. It was stated this week that it's cost the UK economy about zero point one percent of annual gross domestic product. So it's pushed GDP into a negative realm in October. And that makes the whole situation worse not just for JLR, but for the country as a whole. It means that the tax take will be down for that period. And it means that there's pressure on government to find growth as a countermeasure to that cyber attack. It's gonna be a real problem this for many governments around the world. It won't just happen in the UK, it will be happening elsewhere too. So you think it's just a supply chain glitch? It's actually a very big economic glitch for governments and for people everywhere. In the quarter from July to September, JLR lost four hundred and eighty-five billion pounds of business. So that was the loss that they made as a result of the cyber attack. And last year, the same quarter, they made about three hundred and eighty five billion in profit. So you can see what a big impact it's made. It's a change of around about eight hundred billion. It's not small money. And of course, if you think about all those partners they have in the supply chain, they have thousands of small and medium sized enterprises who rely on JLR for their business, make up a big proportion of those companies' business, if not all their business. Then there's medium sized enterprises and the larger businesses that they deal with. So there are thousands of companies that were impacted also by the cyber attack on JLR. And that's why it impacts GDP for the country. This is what the president of AP Molomersk Europe said this week, Emeric Chandivioin. European businesses certainly haven't had it all their own way over the past five years, and the ever-changing global environment facing them is definitely here to stay for the near future. Ultimately, though, it's about turning the prevailing uncertainty into opportunities. One shared attitude among our customers has become abundantly clear. Now is not the time to lament the cards we've been dealt. Now is the time to take action and grow. More and more European businesses are refusing to sit back and wait for volatility to ease. Instead, they're looking to build smarter, more resilient networks that support their ambitions for growth. Molomusk surveyed 900 companies across Europe. More than 78% of the supply chain professionals surveyed said they anticipate that geopolitical dynamics, trade tariffs, and international trade regulations will impact their operations over the next one or two years. Nearly half, 48% expressed deep concern about the geopolitical climate and four out of five recognize supply chain challenges as a factor impacting their business growth. To counter the challenges, businesses want to diversify their sourcing strategies. Three out of four respondents indicated they were either already sourcing from multiple geographies or plan to do so. A notable increase from Mersk's 2024 survey where only 53% said they were considering new sourcing locations. Four out of five businesses are strengthening their relationships with the logistics provider and key suppliers. Sixty percent of businesses are investing in supply chain visibility and agility to increase resilience, and seventy-five percent of businesses said they were adapting to alternative trade routes. We now live in an era of reuse and refill. UK packaging aims to go further, driving systemic change, and they want to prioritize material reduction and they need to scale these reuse schemes so they can drive out the waste and get people reusing the packaging. Sebastian Munden, the chair of WRAP, said the success of the UK plastic pact only represents a job that's half finished. It was launched back in twenty eighteen. WRAP went on to establish thirteen plastic pacts globally, and the UK was the first one. And of course it set some very ambitious goals in place. But he said we're now entering the next phase. There's a strong consumer desire for change. People want to help, they want to recycle, they want to drive away plastic waste. But of course if you can't see change fast enough, if you don't see change quickly enough, essentially it's uh frustrating. Recycled content averages just twenty six percent across major retailers. Producers are still finding it cheaper to pay tax on plastic rather than invest in recycled inputs. Paula Chin, senior policy advisor for consumption at the World Wildlife Fund, said there was a strong consumer interest in driving down and driving out packaging and to make it reusable. But there's still only twenty six percent of that content being driven out by major retailers across the UK. It was interesting this week because I dropped off at one of the biggest retailers, I'll they'll remain nameless at the moment. I was very unimpressed. It's it's a household name, and I had some plastic to drop off, and they're supposed to be recycling conscious. They've got all these recycling initiatives in the building itself to lower the carbon footprint. But when I asked three members of staff in that store in the UK where the recycling point was for this plastic material, they said there wasn't one. So that shows you, are they taking it seriously? I don't think so, in some cases. Black plastic is one of the most difficult plastics to get rid of, but efforts have been made to work on black plastic, and there have been some promising results. Apparently every pound spent on the UK plastic pact created a five pound twenty three improvement. twenty seven million pounds worth savings came from two hundred thousand tonnes of plastic that was avoided. But there's much work to do. Tariffs increase operational costs, they raise the price of raw materials, and it complicates the logistics, and it obviously impacts inventory too, because people hold a lot more inventory because they're unsure when they'll be able to get the next inventory that they need, especially if they're in retail or they're in medicine, as Christmas is approaching. Pharmaceutical professionals have to recognise that tariffs can drive up operational costs, disrupt supply chains, create drug shortages, and they do change investment decisions by the largest pharma companies. Trying to boost domestic manufacturing is one thing, but actually denying a nation of good health, well that's pretty big, isn't it? Pharmaceutical tariffs have been hit by rising prices because of tariffs, delayed deliveries, and shortages. And all those risks are complicating the way the supply chain is working, and it's not working as efficiently as it should be. The pharma tariffs lead to potential drug shortages, and of course, it forces retail pharmacy suppliers to search around for new sources of particular drugs and medicines that they require. To overcome some of the challenges of the pharmaceutical supply chains, companies have to diversify and they set up regional supply chains, which can be rather expensive when compared to global supply chains that used to deliver the products. So already there's a built-in price hike. And optimizing inventory through stockpiles means you need more warehousing space to actually hold the stocks, and you can't operate as efficiently as you could with a lean manufacturing system, because you can't rely on getting the goods in time. So a big farmer problem. As for other retailers, similar picture. Not life threatening as in the farmer industry, or health threatening, but still an issue. As Christmas approaches, major retailers wanting particular inventories, which have six to eight week lead times to get into a warehouse, are finding it difficult to get the stock that they want in time for the sale, period. US imports of containerized goods fell by seven and a half percent year on year in October, and shipments from China plunged by 16.3%. This is all a result of President Donald Trump's evolving tariff policies. US seaports handled a total of 2.3 million twenty foot equivalent units TEUs last month, and that's down 0.1% from September and below the 2.4 million to 2.6 million TEU range that typically signals peak trade activity. It marks only the second October in the past decade, in which a decline has been recorded month over month at this time of year. As the holiday peak season is upon us and store shelves and inventories usually well stocked, the National Retail Federation expects US imports to slow in November and December, and that will be below the two million TEU mark. So these anticipated declines are reflecting a late 2024 import surge fuelled by concerns over potential port strikes and tariff related front loading that brought forward shipments. They were originally scheduled for later months. The trade outlook is for a small decline this year compared with 2024 and a further bigger decline for the first quarter of 2026. Imports from China, which is one of the United States' top trading partners, rose 5.4% month over month with 803,901 TEUs. But the broader picture over the year is a decline, with imports of furniture and bedding down 13.6%, toys and sporting goods down 30.4%, and electric machinery down 17.2% compared with last year, 2024. There's a 20% fentanyl tariff on Chinese imports, and they dropped to 10% on november tenth, while a planned increase in reciprocal tariffs has been postponed for a year. But of course, this isn't like a tap, you can't just turn these things on and off. There are time lags in the whole system. And you don't know what kind of disruption. Once things stop and they start again, will it get back to the same kind of volume? We don't know. And there's still court action taking place in the United States about the president using international emergency economic powers, the act to keep those tariffs in place. So far they've been deemed illegal. Will that change? And what does it mean in reality anyway if the tariffs have caused the chaos in the first place? The chaos is still there. On november seventh, twenty twenty five, the US Geological Survey, on behalf of the Secretary of the Interior, issued its final twenty twenty five list of critical minerals, including uranium among four minerals that were not on the august twenty sixth list, or the draft list, should I say. For those involved in the US nuclear fuel supply chain, three things you need to know about the new designation. It confirms that uranium is essential to the US economy and its national security. The USGS Critical Mineral List serves as a foundational document for American industrial and defense strategy. It's fundamental to the purpose of identifying minerals that are essential for national security, economic stability and supply chain resilience. It supports the critical infrastructure for the modern economy. The United States dependence on imports and the vulnerability of supply chains raises the potential for risks to national security, defense readiness, price stability, economic prosperity and resilience. Uranium demand has increased significantly over the past few years, and it's been driven by the renewal of interest in nuclear power. Artificial intelligence, AI is seen as important as a strategic asset, and requires large amounts of energy, and many see nuclear power as being the core source of that energy. Uranium was included on the initial twenty eighteen final list of thirty five critical minerals, but it was removed in twenty twenty two. It provides tangible benefits to the US uranium industry, being on the critical mineral list. It gives it elevated strategic importance. It aligns with the national security and defense mandates. It's a catalyst for securing domestic supply chains. It prioritizes domestic production, and its influence on future government policy and strategy is there in the list. There'll be tax incentives, financial relief, it'll change investment patterns, and of course, it's hoped it will produce supply chain resilience and mitigate risk. I was reading about massive investments in warehousing space this week, and they were in several locations. Now ask yourself this, is a green field near you becoming a big warehouse? Or is a big field near you becoming a data warehouse? Not just a warehouse for goods, but is it needed for this new artificial intelligence and all the things that are happening in that sphere? The likelihood is that many of you listening will know that there's either a new warehouse for goods or warehouse for data storage and all the servers needed to run AI and all those tools that the Magnificent 7 have at their disposal. And the thing is this is a huge investment. It's huge cost. And it will drive up energy prices because the energy is needed by those warehouses, particularly data warehouses to drive AI. But just take physical warehouses for a second for goods and the space that's needed. If we're building all the warehousing space, have we lost the plot? Because the idea with a supply chain to make it efficient was to lower the use of warehousing space so that goods could be delivered on time. And it's like I said in my book, a warehouse is just a transport mode at zero percent, not going anywhere, doesn't move. So if you could do away with the warehouse and just have the goods move from A to B to whether needed, just think of the billions of pounds, billions of dollars, billions of euros that you could save in the process of having a smarter supply chain. Now you can see the possible trade-offs here. You might have to invest in those data warehouses to get rid of the physical warehouses. And nobody talks about that, do they? But that's a trade-off, I think. Because you need the artificial intelligence to get back in the cycle of making supply chains efficient. Well there's a thought for you for this weekend. Write an essay over the weekend if you're in logistics and supply chain, write an essay of five hundred words, pen it out, drop me a line, and tell me what you think. Well in the next week or two there's a special on artificial intelligence coming your way, and I'm going to be telling you why artificial intelligence is not the future, it's the here and now. And you can catch up and read about my thoughts on this. You could read them in advance, in fact, by dropping by the Chain Reaction Review website and having a look at the article which discusses how things are changing in the world of AI right now in supply chains around the globe. So you might want to have a listen to the episode too when it drops your way. And to make sure you get that episode or notice of the episode, make sure you subscribe to Chain Reaction on your favorite platform. With me, Tony Hines, Chain Reaction all about supply chain advantage. Another episode coming out this month is my interview with Bindia Vakiel, where she tells us all about Acio 3D and what they're doing, using AI to produce components. So no warehouses here. It's print on demand. So make sure you pick that one up too and have a listen. Well that's about it for this week's news roundup. I hope you've learned something you didn't know before you started to listen, and I hope you've enjoyed this edition of Chain Reaction with me, Tony Hines. I'll see you next time with another edition of Chain Reaction when we'll be talking supply chains yet again. Until then, take care, and I'll see you next time. Bye for now.