Editor's Note: This story originally ran in August, but with the election on Tuesday, we're resurfacing it for readers.
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With the U.S. presidential election arriving soon, supply chain professionals are increasingly concerned about its potential impact on the industry. To explore these concerns, we spoke with Alex Saric, CMO at Ivalua, to discuss the key differences between the two candidates' supply chain policies, the significance of Senate and House races, and how November's election results could impact global trade."
Thanks for taking some questions about the upcoming U.S. elections. On a general note, how much impact do you see it having on global supply chains?
No matter which administration takes the reigns in 2025, there will be significant implications for global supply chains, which is why it's mission-critical for procurement leaders to put the presidential election higher on their risk radars. The most strategic organizations are proactively preparing comprehensive, adaptable contingency plans that can be quickly adjusted as conditions and circumstances shift. Companies aren't necessarily holding off on making major decisions until after the election, but they are keeping the potential repercussions of the outcome in mind as they plan for the future.
How do you think the global supply chain landscape would differ under a Trump administration versus a Harris administration?
Regardless of who wins in November, we can expect to see an activist industrial policy stance and continued or increased tariffs. Both candidates' platforms will have massive effects on global supply chains, and changes could happen very quickly, so it pays to prepare and enable business agility.
Resilience in global supply chains depends on the ability to adapt swiftly to changing tariffs, trade policies, and market dynamics. Organizations must prioritize creating a unified data foundation to facilitate informed, agile decision-making when circumstances change rapidly.
Alex Saric, CMO of Ivalua
There will likely be some notable differences between a Trump administration and a Harris administration. Under Harris, we can expect increased emphasis on environmental, social, and governance (ESG) initiatives to help drive sustainability. Under Trump, on the other hand, ESG regulations will likely be rolled back, though many organizations will voluntarily continue to adhere to ESG practices to maintain compliance with international standards. Trump has also promised to impose a broader, 10% tariff across the board on all imported goods and a 60% tariff on Chinese imports, both of which could have major impacts on the supply chain. Harris is likely to continue the current approach of more focused tariffs started under the previous Trump administration and expanded under Biden.
Do you expect more interest in this election than in years past?
I think every election elicits interest from those with stakes in the global economic landscape, but the potential for supply chain disruption this time around is particularly significant. Campaigns are focusing much more on factors such as tariffs which have a major impact on supply chains. From changes in labor laws to immigration policies, the election results will underscore the need for companies to prioritize flexible supply strategies. Integrating supplier management technology to handle increasing data requirements resulting from new initiatives will be crucial for mitigating disruptive impacts from policy changes. It's going to be a dynamic environment, so anyone dependent on global supply chains needs to create proactive roadmaps for navigating the risks.
Do the other elections -- Senate and the House, as well as local governor races -- also have an impact?
Other elections will have an impact on the global supply chain as well, but they will generally not be as pronounced or immediate as the Presidential election. While the U.S. Constitution gives Congress much of the trade authority, in practice, this has increasingly been delegated to the President so that result is the most critical. That said, the other elections can have an impact as well so must also be considered. Senate, House, and governor races are electing officials who can potentially put forth new laws and regulations that could affect the global supply chain as well. These bills have to successfully pass through both chambers and be signed by the President to be enacted into law, which doesn't happen overnight, and sometimes doesn't happen at all.
How do you anticipate the trade policies might change depending on the outcome of the U.S. election?
Regardless of the winner, I expect to see a continued emphasis on supply chain resilience and reducing dependency on China. The primary difference between the likely trade policies of the two candidates seems to be the scope, with Trump indicating more broad-based tariffs which will impact more regions and categories.
A key challenge that may emerge is the fact that many supply chains have formed hubs, like auto manufacturing in Detroit, where multi-tier suppliers sprouted up near one another. Something similar happened in China for many industries. These clusters will need to be developed in other markets to support the same efficiency while reducing dependence on Chinese hubs.
However, replicating these integrated ecosystems in new markets takes time. In the interim, costs will be higher, the risk of disruption will be higher and greenhouse gas emissions will be higher from longer transport routes through the supply chain.
How might U.S. relationships with key trading partners, such as China and the EU, evolve with the election results?
U.S. relationships with China are likely to remain strained no matter who wins the election, but depending on the specific commodity we're talking about, it may be hard to shift away from relationships with China. Some imports from them, like rare earth minerals and products heavily dependent on those minerals, don't have viable alternative suppliers.
In other cases, shifting will be much simpler, but limited suppliers will drive costs up until supply can adjust, which can take years for some commodities that have long investment and extraction periods.
Relations with the EU seem likely to face more strain under a Trump administration due to the broad-based nature of tariffs he is suggesting. That will put all trading partners in a difficult situation and create pressure for more retaliatory policies.
Because of these challenges, it's imperative to diversify supply chains to reduce dependency on single regions and countries.
As CMO at Ivalua, Alex Saric oversees the company's overall marketing strategy and thought leadership initiatives. Before joining Ivalua, he spent 13 years at Ariba, where he led the international marketing team until its acquisition by SAP. Alex began his career in the U.S. Army Cavalry, where he led tank and scout platoons during two combat deployments. He holds a B.S. in Economics from the U.S. Military Academy at West Point and an international M.B.A. from INSEAD.