A manufacturer's up-close view of Trump's tariffs
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Illustration: Sarah Grillo/Axios
This is the hard truth for American manufacturers: Trump's tariffs are all but inescapable unless the global supply chain — the decades-long backbone of domestic manufacturing — is replicated stateside.
Why it matters: It won't happen overnight. For now, many businesses in the sector Trump hopes to revitalize face the prospect of higher costs and withering demand from foreign buyers.
What they're saying: "There isn't the capacity, knowledge, nor the facilities to have American manufacturing compete on this scale over a ten-year horizon, let alone one," says Megan Murphy, who owns La Crosse Milling Company, a which processes grains for food ingredients and animal feed at a plant in Cochrane, Wis. (outside of Buffalo City).
- "I don't think there's a single small U.S.-based agricultural company that thinks this is a good long-term strategy for building manufacturing competitiveness," Murphy tells Axios.
The intrigue: Many U.S. factories, including Murphy's, run with machinery with foreign-made parts.
- Domestic manufacturers may assemble the finished product in America, but key inputs are sourced globally.
- Take World Emblem, a Florida-based company that manufacturers half a million clothing patches each day, and which sources thread from Europe.
- The company ships raw materials to its factory in Mexico for early-stage manufacturing. It comes back to the states for final assembly before being shipped out to its customers.
"You can't pick up 500,000 square feet and 1,000 jobs and just drop it in the middle of the United States," says World Emblem CEO Randy Carr.
- "There's the issue of time, money, training, square footage, developing the proper capacity and prepping the workforce," he adds.
The bottom line: Think about the trade policy whiplash over the past two decades — just a few years ago, the Biden administration supported near-shoring.
- Trump ripped up the global trade playbook virtually overnight, a gamble to reinvigorate domestic industry that might take years to adapt — assuming this trade policy stays intact.
"If the plan is to get everybody to onshore, I'm okay with whatever we decide as a society, but we need time to wind things down and spin things back up in a way that doesn't impact our overall business and customers," Carr says.
