Conference session and focus

At CSCMP EDGE in National Harbor, Maryland, a panel session examined how tariffs, trade policy and an extended freight downturn are driving changes in supply chain strategy. The discussion, titled "Trade, Tariffs, and Turbulence: Building Resilient Supply Chains," explored inventory levels, shipper-provider relationships, tariff impacts and other pressures shaping freight markets today.

Panelists and moderator

The conversation featured industry leaders representing retailers, third-party logistics and manufacturing: Michael Castagnetto, President, North American Surface Transportation at C.H. Robinson; Chelsea Morris, Vice President of Global Inbound Transportation at Dollar General; and Michael Sekula, Vice President of Global Supply Chain at Inpro. Ken Hoexter, Managing Director and Senior Transportation Analyst at BofA Securities, served as moderator.

State of the freight recession

Moderator Ken Hoexter highlighted that the current freight recession has persisted for roughly 3.5 years, a duration well beyond the 54-week average observed in earlier freight downturns such as 2015–2016, 2019 and the 2020 pandemic period. He noted that inventories remain elevated on aggregate—particularly among retailers, industrial shippers and manufacturers—which is not ideal because lighter inventories after downturns are typically preferred. Hoexter also pointed to over-the-road capacity exiting the market as an important dynamic.

Capacity-driven to demand-driven market shift

Michael Castagnetto said the early portion of the current freight downturn was largely capacity-driven, with excess trucking capacity remaining in the market longer than normal. Contributing factors included a weak used truck market, limited bank foreclosures on trucks and leftover stimulus funds that delayed capacity exit. Over the past 12 to 18 months, he said, the market has shifted more toward a demand-driven freight recession.

Castagnetto cited the Cass Freight Index as showing deceleration rather than acceleration in recent quarters and said C.H. Robinson expects the subdued demand to continue for the foreseeable future. He added that the industry would welcome a demand uptick, whether reflected in measures such as total loads per RRSP or improvements in router degradation, but current data do not show such an increase.

Retail perspective on inventories and customer value

Chelsea Morris described Dollar General's strategy through the lens of the retailer's customer base, which she said represents the lower third of U.S. income levels. In that context, Dollar General prioritizes waste elimination and maximizing value for customers. With inflationary pressures and other cost drivers, Morris stressed that sustaining demand depends on ensuring the company delivers value to its core shoppers.

Tariffs and aluminum supply dynamics

Michael Sekula discussed the effects of recent U.S. aluminum tariffs, noting the administration imposed a 50% tariff on aluminum that altered cost dynamics. He said that policy made it so U.S. shippers could no longer import finished aluminum more cheaply than domestic production, and that prices have risen more than 100% since the start of 2025. Sekula framed the tariff approach as an attempt to bring some manufacturing back to the United States.

At the same time, he noted structural limits: the U.S. produces only a small share of its own aluminum—roughly 10%—while about 80% of supply comes from Canada, and the country cannot quickly restart primary smelters. Sekula said those constraints mean tariffs are unlikely to immediately transform the domestic aluminum supply picture.

Experience shifting sourcing away from China

Sekula recalled shifts that began in 2016 to move sourcing away from China and described Inpro's own experience after acquiring a company in 2022 that included about $5 million in imported product. He said much production moved to Vietnam and other countries, but some of those sources later faced tariffs as well. In certain cases, Sekula explained, tariffs would have had to reach roughly 200% before domestic purchases became cost-competitive. He also observed that locally sourced alternatives can be of lower quality—for example with fabric—and that the company competes against customers who source in multiple ways: imported, locally purchased, or manufactured in Mexico and brought across the border.

Speed, volatility and scenario planning

Castagnetto emphasized that supply chains had already been evolving before tariffs were imposed, pointing to China-focused strategies such as a China plan, China-plus-one, and a long-term trend toward nearshoring over the past 10–15 years. What has changed markedly in the last nine months, he said, is the speed of those shifts combined with heightened volatility and variability, which complicates planning for customers.

He gave the example of companies that shifted production from China to Vietnam only to find that, during an initial round of tariffs, Vietnam faced higher tariffs than China—leaving some firms worse off than if they had remained in China. To address uncertainty, Castagnetto said his team emphasizes scenario planning that assesses a company's current supply chain, alternative vendor options, comparative costs and efficiencies, and the timelines required to establish new sources. He noted that starting production at a new site can take four to five years before meaningful volumes are achieved, and the marketplace may well look different by the time a facility is operational.

Practical adjustments for shippers

Chelsea Morris outlined practical approaches shippers can use to adapt inbound supply chains amid uncertainty. She identified several options companies are employing:

• Relocating sourcing to different countries or regions to offset instability
• Deepening collaboration with vendors to improve resilience and responsiveness
• Implementing price increases only as a last resort

Takeaway on planning and stability

Panelists agreed that while predicting the exact future state of trade policy and freight demand is difficult, companies need actionable scenarios and stability to plan. Suppliers and shippers are balancing rapid shifts, tariff impacts and prolonged weak demand by evaluating options now and preparing alternate strategies for the next six to 12 months while recognizing longer-term lead times for material production changes.