Better data can help business leaders navigate the byzantine maze of reciprocal tariffs, retaliatory measures, and special-interest carve-outs.
On April 7, United States President Donald Trump announced a sweeping array of reciprocal tariffs on imports from countries around the world. The base rate was set at 10%, but a total of 89 countries were hit with higher tariffs, with each one’s rate based upon a combination of factors including the size of its trade imbalance with America.
Exactly one week later, amid high tension in financial markets, President Trump put his plans on hold for 90 days, reverting instead to a 10% across-the-board tariff rate on all countries except for China, America’s largest trading partner, whose tariffs were increased to 145%.
As for everyone else, the higher global tariff rates are set to resume on July 8, providing businesses with a 90-day reprieve to adjust their plans. The landscape could get murkier still as other countries announce countermeasures of their own or seek to strike deals. Some sectors are exempt from the tariffs under existing trade agreements, which will likely prompt other countries to negotiate carve-outs for their key industries.
Figure 1: Import tariffs on America’s top 15 trading partners
(Announced April 2, to take effect July 8)
For any business whose suppliers or supply chains are located beyond America’s borders — whether in China or anywhere else — tariffs have gone from an afterthought to a top-of-mind preoccupation. Amid the instability, many businesses have put product orders and capital investments on hold, uncertain how to proceed through a landscape that seems impassable.
The only way to chart that course is with better data about tariff exposure. “Companies may know what the tariff rates are for their products,” says ImportGenius President Christopher Schafer, “but they often don’t know how their exposure compares to their market or their competitors.” Once armed with that information, they can make better decisions about new markets, new trade routes, and new strategies. “With a volatile global tariff regime unfolding before our eyes, that kind of insight is more valuable than ever.”
Strategies to minimize tariff exposure
With the United States now applying tariffs to imports from every country in the world, it’s nearly impossible to completely avoid tariff exposure. At the moment, the only products that can escape tariffs are goods whose supply chains are vertically integrated entirely on American soil, or on North American soil provided they meet the requirements of the United States-Mexico-Canada free trade agreement.
But companies can minimize tariff exposure by seeking out other existing suppliers in lower-tariffed countries — a particular concern at the moment for anyone doing business with China, given its 145% tariff rate. Publicly available U.S. trade data, which is searchable through tools such as the ImportGenius database, can help companies identify multiple suppliers around the world for just about any product, including their competitors’ suppliers. With each country soon subject to its own unique tariff rate, it makes sense to identify as many potential sources as possible.
And as the calendar approaches the July 8 deadline for re-imposing higher global tariffs, companies can also take steps now to receive overseas shipments before that date. Shippers are expecting a surge of freight orders for the 90-day period from regions outside of China, as businesses lift holds on previous orders and seek to get ahead of higher tariff rates.
This kind of stockpiling, or pre-importing, is a strategy that will stretch overseas production capabilities and require additional domestic warehousing capacity, which can be logistically challenging, especially for companies with just-in-time supply practices. But it’s also a move that can buy time, stabilizing a company’s prices for months to come and, hopefully, allowing it to ride out the worst of the tariff uncertainty.
ImportGenius case study: Minimizing auto industry tariffs
Stockpiling and pre-importing have been underway for months in some industrial sectors, including the automotive industry. Manufacturing supply chains for vehicles are truly global: parts are built around the world, and can cross international borders multiple times before final assembly. That’s one of the likely reasons why, according to data compiled by ImportGenius, General Motors showed a marked increase in finished vehicles imported from Mexico beginning in late 2023 and throughout 2024, most noticeably in the last three months of that year.
Throughout his 2024 campaign, President Trump made clear his intention to implement higher tariffs. Back in October, he told Bloomberg News that tariff was “the most beautiful word in the dictionary” and that tariffs on vehicles from Mexico could reach as high as 200%, calling into question the protections provided by the United States-Mexico-Canada free trade agreement.
Against this backdrop, General Motors — which had average vehicle imports from Mexico of 145,601 for the first three quarters of 2023 — raised imports significantly, averaging 179,309 vehicles per quarter since then. The move helped the company keep the price of those vehicles below $30,000 throughout 2024. (The data is based upon HS codes 8703 and 8704, which represent finished vehicle imports. “HS” stands for Harmonized System, the classification standard for international trade reporting.)
Figure 2: General Motors quarterly vehicle exports from Mexico to USA, 2023-24
Figure 3: Monthly price of GM vehicles imported from Mexico to USA, 2024
A variety of other factors may well have contributed to the change in GM’s import patterns. But the prospect of having high tariffs imposed upon their established supply chains would spur any manufacturer to take this kind of action.
In fact, GM was not the only manufacturer to increase its late-2024 imports from Mexico. Korean manufacturers Hyundai and Kia, which typically export roughly 40,000 vehicles per quarter from Mexico to the United States, increased that figure to more than 52,000 vehicles in the last three months of 2024. The increase is attributed to rising demand for SUVs as well as tariff minimization.
Figure 4: Quarterly Korean vehicle exports from Mexico to the United States, 2022-24
It’s important to note that this data merely shows imports of finished vehicles, and it’s unclear how these firms will respond once tariffs are in effect. Their supply chains include dozens of smaller firms making everything from floor mats to roof racks, all of which could be subject to new tariff measures, carve-outs or exemptions, which are often based upon complex country-of-origin calculations that take into account where its materials and components are sourced.
What tariffs mean for your business: the first-mover advantage
Tariffs aren’t merely driving market uncertainty and instability — they’re also likely to drive up prices. To stay competitive and keep goods affordable, businesses must pull every lever at their disposal. Company leaders can seek to absorb the added cost of tariffs by lowering their own production costs, squeezing or switching input providers, or renegotiating fees with distributors.
They can also get smarter about their tariff exposure, and the many factors that influence it. With the right information at hand, they can seek out new markets with lower tariffs; consider new inputs based upon tariff rates and country-of-origin rules; find out how they compare to key competitors; reroute their supply chains; and much more.
But the greatest advantage will go to first-movers who are quickest to find and tap into new information, new suppliers and new supply chain routes, and capture that available production capacity ahead of competitors. “After years of relative stability in tariffs, companies are facing a chaotic environment for global trade,” says Schafer. “Staying competitive is about getting smarter with fresh, updated, competitive information and insight about global trade — and being the first to act on it.”