Court Rulings Won’t End Tariff Disruptions

Supply Chain Leaders Still Must Prepare for the Era of ReGlobalization

Will tariff disruptions soon be a thing of the past?

After all, a U.S. Federal Appeals Court has upheld an earlier trade court ruling that President Trump does not have authority to unilaterally impose tariffs under one federal statute. Cue the celebratory LinkedIn posts, Wall Street commentary and conversations in corporate boardrooms: “Maybe the tariffs are going away. Maybe we can just hold tight.”

Knowing supply chains and knowing Trump, that mindset is a dangerous illusion. This latest court decision is just another tariff disruption, not a conclusion.

While courts ruled the administration could not use the International Emergency Economic Powers Act (IEEPA) to impose tariffs, they left tariffs in effect until Oct. 14. That gives the president ample time to pursue other legal avenues, including his appeal to the U.S. Supreme Court or alternative statutory authority.

So, lawyers can continue debating case law. But our business reality is that Trump’s tariffs will be upheld in one form or another. And if your enterprise is not preparing now for the era of ReGlobalization, you are already behind.

Presidents Have Enacted Tariffs for Decades

When I hear executives say, “We’ll wait and see what the courts decide,” I shake my head. Waiting is not a strategy. Eventually, one way or another, business leaders must accept the world of tariffs.

Trump is not the first president to enact tariffs without going through Congress. President Nixon placed 10% tariffs on foreign goods in 1971. In 1986, President Reagan enacted tariffs on certain goods from the European Economic Community, then Japanese semiconductors in 1987.

President Clinton imposed duties on European Union goods in 1999. In 2002, President Bush targeted steel imports. President Obama placed tariffs on Chinese tires in 2009, Chinese solar panels in 2012. I could go on with other examples, but you get the point.

True, Trump is more tariff happy than his predecessors. He enacted a swath of tariffs during his first term – without citing the IIEPA. Trump’s successor, President Biden, largely kept those tariffs in place – also without using the IIEPA.

Trump has already petitioned the U.S. Supreme Court to overturn the appeals court ruling that bars using the IIEPA to impose tariffs. Even if that avenue fails, the history above shows U.S. presidents have plenty of statutory authority to enact tariffs.

The administration could use the Trade Act of 1974, although that law restricts tariffs to 15% and to just 150 days. That leaves Section 232 of the Trade Expansion Act, which offers a national security-based justification for tariffs.

The administration could easily reframe existing tariffs under that statute, which Trump used for his tariffs on steel, aluminum and automobiles.

The Trade Expansion Act requires a Commerce Department investigation. While that might crimp Trump’s penchant for changing tariffs on a whim, do any business leaders really think Trump will give up on one of his signature issues?

The Courtroom Is Not the Supply Chain

So while judges are interpreting the laws, your companies need to make and move goods.

Supply chains still must operate every single day. Containers must be loaded, ships must sail, trucks must roll, warehouses must pick and pack.

As you wait, your competitors are diversifying suppliers, shifting trade lanes, building new warehouse capacity and negotiating with alternative partners.

Tariffs, like every disruption of the last five years, create costs and complexity. They make sourcing from one country more expensive. They shift cost structures and force companies to rethink production and distribution.

But those changes also create opportunities. Those who move first to build resiliency will not just survive – they will win.

Because on the other side of chaos lies the unlimited opportunity of ReGlobalization.

Building Optionality in an Uncertain World

Many executives have confided in me: “We know tariffs may stick. But we don’t know what to do next.” The first step is to embrace scenario planning to provide multiple alternatives for the future – optionality.

Because anybody predicting what might happen next might as well try to catch smoke with their bare hands.

Tariffs could increase to 60% on Chinese‑origin goods, drop to 20%, broaden to categories not yet covered or temporarily fade only to snap back. Each tariff disruption demands a different playbook for costs, delivery times and service levels. Smart companies build plans for each scenario and identify trigger points that will prompt action.

When your models show the impact of higher tariffs on your primary sourcing country, the need for supplier diversification becomes apparent. A resilient supply chain doesn’t rest on one country or one supplier. You must evaluate and qualify secondary suppliers in Southeast Asia, Latin America, Eastern Europe, Africa, etc. As I wrote two years ago, the world is now your supply depot.

That means due diligence: site visits, audits, trial runs and even co‑investment partnerships to ensure capacity and quality.

This move to geographic optionality in manufacturing and supply is critical. Because in the era of ReGlobalization, this is a game of and, not or.

Mexico and Brazil can both be part of your production footprint. The Dominican Republic and Panama can both serve as logistics hubs (or more – details to come later). The U.S. and Asia can both provide critical inputs.

Establishing multiple manufacturing and distribution locations may seem expensive. But the cost of disruption to a single source is higher. If tariffs shift overnight, those with diversified footprints can reroute production without missing a beat.

Finally, scenario planning must incorporate transportation and route flexibility. New suppliers and factories change the shape of your logistics network.

Digitally Orchestrate the Supply Chain for Resilience and Compliance

ReGlobalization isn’t just about where you make things; it’s about how you orchestrate the entire supply chain. To thrive in a tariff‑ridden world, you must digitally enable your network.

Tompkins Ventures is increasingly connecting manufacturers and retailers with AI‑powered platforms to predict and respond to disruptions. These tools ingest data on geopolitical risk, extreme weather, port congestion and even social sentiment. Then they turn it into actionable intelligence. They help you see trouble coming, simulate responses and decide when to pivot to alternative suppliers or routes.

Next, invest in multi‑supplier collaboration tools that allow you to share forecasts, quality metrics and production schedules across continents. Digital supply chain networks create real‑time visibility from raw materials to finished goods. They automate data flows between suppliers, carriers and customers so that you’re not relying on spreadsheets and emails.

AI‑driven planning engines can then optimize production and replenishment across your network. Instead of reactive firefighting, you get predictive insights that highlight potential shortages, overstock or transportation delays.

Digital enablement also means upgrading your approach to customs compliance. As tariffs proliferate, so do the risks of misclassification and non‑payment. The smartest companies aren’t trying to memorize duty codes. They’re matching with customs and trade compliance partners who can automate tariff calculations and adhere to local regulations.

Over time, these digital foundations will make advanced technologies – AI forecasting, IoT sensors, digital twins and blockchain traceability – easier to deploy. Real‑time tracking of shipments, predictive inventory adjustments and automated customs filing will become table stakes.

But you can’t implement them overnight; they require clean data, disciplined processes and a willingness to evolve roles. Supply chain planners become model overseers and scenario strategists rather than spreadsheet jockeys.

Act Now to Turn Tariff Disruption into Advantage

Tariffs may seem like a legal or political issue. And they are.

But sadly, politics has intruded upon supply chains, so tariffs are, for us, a supply chain issue first. Business leaders who prepare now will have goods flowing, customers satisfied and competitive advantage secured. Those who procrastinate will watch their market share slip away.

While upheaval is an opportunity, not an enemy, you don’t have to go it alone. Tompkins Ventures’ partners have decades helping companies navigate uncertainty, transforming their supply chains for resilience and growth. Let’s talk about how we can help you build the optionality and digital enablement you need to win in the era of ReGlobalization.

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