Manufacturing leaders are grappling with a range of geopolitical issues from market volatility, tariffs, regulations, cyber threats, and restrictive immigration. With challenges arising from every angle, what direction are manufacturers turning and how are they navigating a future-forward mindset?  

We took a deep dive into how the current climate of uncertainty affects these trends, how priorities have shifted, where companies might be tapping the brakes on investment, and which strategies they are confident in pursuing regardless of the global situation. Our research included a survey of over 150 U.S.-based industry executives, as well as personal interviews with nearly two dozen manufacturing CEOs and key executives in operations.

Manufacturing leaders rank their level of progress in dealing with geopolitical risk dead last compared to other top-of-mind challenges. Compared to “Manufacturers Disrupting Themselves,” the first edition of this report in 2023, the appetite for investment and change has shifted. Manufacturers are forced to adapt—and quickly.

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Key Findings:

• The geopolitical situation is stalling investment and strategic development in manufacturing. Manufacturers largely agree with the policy goals of leveling the playing field in trade, but they dislike the haphazard way those goals were being handled in the first part of 2025.  
• Manufacturers are focused on optimizing their geographic footprint to align products with the end market. The share of manufacturers who say localization is “highly relevant” for their operations rose to 74% from 61% in 2023.  
• The skills shortage is believed to get worse before it gets better. Eighty percent of respondents believe that the labor shortage will be exacerbated by increased demands from localization trends. Nearly all companies are building talent development programs into their workforce strategies, but digitalization and automation are considered strong solutions to the shortage.
• Organizations are not slowing down digitalization plans, rather expecting acceleration. Low-cost tools such as augmented reality (AR) have become more popular, aligned with the desired shift towards less capital-intensive solutions.
• The desire for customization continues to grow, favored by tangential challenges. Many manufacturers are looking increasingly towards customization in favor of market-specific, bespoke product development for greater competitive differentiation and also as a preference for the customer.
• Sustainability is relatively on track for those already adhering to sustainability goals. Organizations that are on the path continue to pace company-specific goals despite changes in regulation and federal programs. Yet, 65% of respondents expect geopolitical risk to decrease sustainability investments.  

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Looking for More?

Join the webinar, Q2 Economic Outlook & Strategies to Propel Your Organization Forward, for both an economic update as well as a greater conversation around the key findings of the report. 

About Roland Berger

Roland Berger is one of the world's leading strategy consultancies with a wide-ranging service portfolio for all relevant industries and business functions. Founded in 1967, Roland Berger is headquartered in Munich. Renowned for its expertise in transformation, innovation across all industries and performance improvement, the consultancy has set itself the goal of embedding sustainability in all its projects. Roland Berger generated revenues of around 1 billion euros in 2024.