The 10th annual state of manufacturing and supply chains report by Fictiv goes on to share survey reports of hundreds of supply chain and manufacturing leaders throughout the numerous industries in order to gauge their perspective, barriers, and forecast for 2025. Let us dive into the border supply chain outcomes, especially in a year that has been marked by massive tariffs as well as trade disruptions.
Raising the global business uncertainty
The first finding as per the report concerns the business apprehension. With the transition in the US presidency and its trade policies, almost 100% go on to say that they are worried that trade wars are likely to speed up and rise in the next few years.
Key findings:
Almost 96% of the manufacturing leaders go on to report that they are concerned as far as the impact of the US president’s trade policies is concerned.
93% believe that a trade war is likely to escalate in the next few years. Apart from this, 42% are very concerned, which is a 6-point increase over the last year.
91% go on to note that global tensions are also being considered as far as their company’s long-term supply chain strategies are concerned. This is a 5-point increase over 2024.
Speeding up the supply chain disruptionsÂ
The next key finding is about accelerating supply chain barriers. The board executives happen to be saying that they need to speed up how they are currently managing their supply chains. Two-thirds, or almost 68%, say that onshoring is a key priority in 2025, as far as their teams are concerned.
Key findings:
68% of the leaders happen to prioritize onshoring as a major supply chain strategy for 2025, specifically across industries that need intricate parts at scale, such as MedTech, EVs, clean energy, etc.
77% go on to report lack of resources, which severely challenges their capacity to manage their supply chains in an effective way. This is an increase over 2024.
52% of the manufacturers’ leaders happen to identify dependence, supplier quality, and compliance as a major challenge.
If we look into the 3/4 or 77%, they don’t have the resources in order to effectively manage their supply chain the way it is today. This is pretty changing, given the leaders also say that they want to onshore their supply chain. If the supply resources are already in limitation, moving back to the US is going to be a major challenge.
50% also happen to say that the quality as well as dependence are a major challenge. There are some who are running well-performing supply chains, but there is also another half who are running supply chains that are inadequate.
Scaling the production has become more challenging than ever
The third major finding is about the scale of production. This has been one of the most difficult it has ever been. The manufacturers are indeed struggling to find high-quality supply chain partners in order to do low-volume builds.
Key findings:
91% of the manufacturing supply chain leaders face barriers when it comes to product innovation and introduction, with 50% struggling to source fast and high-quality offerings for low builds.
86% report that sourcing parts as well as materials is taking time away from initiatives such as new product innovation and introduction by making it increasingly difficult to move into and also scale the production.
There are 90% leaders who are consistently reporting that the digital manufacturing platforms happen to be an essential service as far as production is concerned, which is up from 86% that was seen last year.
Secondly, there are almost 90% who are saying that all the work that is needed in order to source the parts is taking away the innovation aspect. In other words, if there is someone who is launching a new product, the sourcing has become the bottleneck.
All this goes on to make driving innovations in order to build electric vehicles, surgical equipment, and rockets incredibly challenging, thereby stalling the innovation part of tomorrow.
In the 10 years that this report has been coming out, this sort of trend has been consistently seen. There are executives who are looking to digitize the supply chains. This indeed continues to be a major focus area, and it is up from 86% that one saw in 2024. So the takeaway is that for the teams that are scaling new products and moving into production, they have to think about this as another phase of development. There is a development that takes place by building the prototype and getting it into the market is the next and the most vulnerable step.
Sustainability takes charge
Key Findings:
There are 95% who report weather as well as extreme climate issues that are impacting their supply and strategy in 2025.
91% have the sustainability initiatives as well as governance in place in order to help drive the sustainability objectives.
52% go on to believe that onshoring as well as nearshoring strategies are indeed crucial when it comes to supporting sustainability endeavors.
The fourth finding centers around the sustainability part. This continues to be a major focal point for the audience. At the macro level, one has seen massive fires across California, floods, tsunamis across the world, and even hurricanes. These extreme weather conditions are affecting the supply chains throughout the world, and there is no industry that is safeguarded from them.
It is indeed heartening to see that 91% happen to have the sustainability initiatives in place, and there are some types of governance also that are taking shape, which is an increase from the previous years.
ESG has indeed been a clear focus area as far as many executives and supply chain teams are concerned. But in 2025, 91% happen to say that they have actual governance in place in order to do a triple bottom line, which is really very encouraging. They are looking at sustainability from a larger perspective and as being a larger driver when it comes to consideration in supply chains.
And in the end, nearshoring as soon as onshoring happens is crucial in supporting sustainability efforts. Although near showing may not necessarily be a complete climate or sustainability option. There are certain other elements, such as geopolitical factors and economics, that can be major aspects here.
Advances in AI
And there cannot be a report on the state of manufacturing and supply chains in 2025 without having AI in it.
Artificial intelligence happens to be the top trend, which is shaping the long-term strategy, be it the latest or the greatest LLMs or even looking at augmenting the human tasks; AI happens to be at the forefront at all times.
Key findings:
87% of the leaders go on to report that advanced levels of maturity are witnessed in their companies, AI executions.
94% make use of AI when it comes to manufacturing as well as supply chain operations like product design and also inventory management.
56% of manufacturing and supply chain leaders go on to identify AI as one of the leading trends that is shaping their long-term strategy, while another 53% think of economic headwinds.
87% report advanced levels of maturity when it comes to implementing artificial intelligence. Around 100% go on to say that their teams are making better use of AI in day-to-day tasks.
94% opine AI for manufacturing and supply chain operations to be their main execution, be it product design, inventory management, or supplier development. While AI is causing a lot of disruption, there is also scope for multiple factors to be considered. So it is always advisable to implement AI well and use it in routine. However, don’t look at it as a silver bullet in solving all the supply chain challenges.
