HSBC’s latest survey shows tariffs and trade volatility are already inflating costs for most transport and industrial companies, with the majority bracing for further increases. While many are exploring nearshoring to counter the pressure, execution is slow as firms wrestle with cost, capacity, and strategic uncertainty.
Persistent Cost Increases and a Confidence Gap
Two-thirds of transport and industrial companies say tariffs and trade disruption are already driving up costs, according to HSBC’s latest Trade Pulse Survey. The report, which covers 5,750 international businesses across 13 global markets, finds 63% of firms in the sector have been hit by higher expenses, just shy of the cross-industry average of 66%.
The squeeze shows no sign of easing. More than 70% of transport and industrial respondents expect the burden to grow over the next six months and to linger into 2027. Vivek Ramachandran, Head of Global Trade Solutions at HSBC, notes that these pressures come alongside an average 18% drop in revenue across affected companies. The challenge, he says, is to “navigate this climate with agility and build partnerships that sustain growth in a shifting global economy.”
Forecasting has become particularly fraught. Only 18% of transport and industrial companies say they can confidently predict demand and costs over the next 12 months, a figure below the all-sector average of 21%. That uncertainty makes strategic planning harder just as trade volatility reshapes market access and pricing.
Nearshoring Intentions Outpace Execution
The survey reveals uneven progress in preparing for prolonged disruption. While 51% of sector respondents say they are informed and actively taking steps, only 34% describe themselves as both informed and prepared. The rest risk being caught in reactive mode as trade headwinds intensify.
Nearshoring, shifting production or sourcing closer to home markets, is gaining traction. 55% of transport and industrial companies say they plan to move in this direction, versus 49% across all sectors. Yet only 29% have acted, lagging the all-industry average of 34%. The implementation gap reflects the operational and financial hurdles of supply chain reconfiguration, from finding capacity in alternative markets to balancing cost and speed.
Trade realignment is also shaped by geopolitical realities. Despite escalating tensions between Washington and Beijing, just 29% of transport and industrial firms plan to increase U.S. exposure, compared with 39% overall. Nearly half (48%) are looking to deepen links with China, slightly above the all-sector average, suggesting a pragmatic approach that prioritizes operational advantage over political alignment.
Rethinking Resilience Beyond Tariff Cycles
While tariff risk often drives short-term responses, the survey points to a deeper need for structural change. Diversifying supplier geography, locking in multi-year contracts before tariff shifts, and integrating tariff forecasting into cost models are emerging as resilience levers. The companies that close the gap between nearshoring ambition and execution, while also building flexibility into trade relationships, will be better positioned to absorb future shocks without conceding margin.