Investing in reindustrialisation, the real priority for companies in Europe and the US

Large US and Old World companies with annual sales in excess of USD 1 billion are intensifying their efforts to reconfigure their manufacturing operations to mitigate fears related to supply chain pressures, rising tariffs and trade disputes. The global reconfiguration of supply chains and manufacturing capacity, as well as the diversification of the same components, is seen as strategically prioritised over short-term profitability. So says the 2025 edition of the report "The Resurgence of Manufacturing: Reindustrialisation strategies in Europe and the US" by Capgemini Research Institute, a study according to which - over the next three years - organisations will also strategically focus on another operating model to reduce the risks associated with uncertainty in their supply chains, namely 'friendshoring', a business practice whereby supply networks focus on countries considered allies in political and economic terms to further reduce risk exposure.

The survey was conducted between 1 and 20 January this year, before the market tensions generated by Donald Trump's stances produced the heavy repercussions on global markets that have characterised the last two months. However, the level of tension was such that two-thirds of the more than 1,400 companies analysed (compared to 59% recorded in 2024) initiated and implemented a reindustrialisation strategy in some cases, accelerating their respective plans to diversify their production and supply chains. Also very emblematic is the figure in which 60% of the managers surveyed declared their decision to continue in this direction despite higher capital costs, and equally significant is the percentage confirming that most of the managers involved (82% to be precise) intend to reduce the supply chain's dependence on China, a significant increase on the 58% of a year ago.

Bringing production closer to the target markets, as Capgemini's experts point out, is therefore the priority marked in red for the management of large organisations, and as complex and costly as the work of reorganising supply chains is, companies have decided to invest seriously in increasing long-term competitiveness, on the one hand by harnessing advanced technologies and on the other hand by seeking to activate region-wide partnerships with suppliers, tech providers and policymakers to build a more resilient, flexible and adaptable manufacturing ecosystem. Supply chain pressure is cited as the main driver of this strategy shift by 95% of surveyed managers, up sharply from 69% in 2024, while customer proximity emerges for the first time as the second driver overall (92% of the sample cited it). Adding to the level of complexity of the logistics challenges is, in parallel, the issue of duties, with 93% of managers expressing concern about their economic impact.

"The announcement and subsequent entry into force of US duties,' explained Riccardo Dolfi, Managing Director of Capgemini Engineering in Italy, 'is leading to a reorganisation of trade relations on a global scale, and from our observatory we are seeing some phenomena, also anticipated by the report, evolve and become concrete. We are witnessing, for example, the birth of unprecedented collaborations, such as the one announced between China, South Korea and Japan, which will strengthen their cooperation in response to the extra costs that directly affect the exports of the three countries. We are also witnessing the concretisation of re-industrialisation policies in key sectors such as semiconductors, with two giants such as AMD and Nvidia making it official that they intend to move part of their production to TSMC plants in Arizona, effectively reducing Asian dependence in favour of new investments in the United States.

Re-industrialisation is therefore increasingly seen as a strategic response to the geopolitical environment and is particularly so in the battery/energy storage, automotive and telecommunications sectors, with more than half of international managers stating that tariffs are in fact accelerating their reshoring efforts. Over the past twelve months, the note accompanying the report further states, leaders have intensified their strategy of relocating production and supply chains, with more than half of them (56%) investing in nearshoring or a combination of reshoring and nearshoring their production, up from 42% in 2024. This clear trend is set to continue, with onshore and nearshore operations projected to increase over the next three years to account for 48% and 24% of total production capacity respectively.