Maersk CEO Vincent Clerc said President Donald Trump’s vision of a reordered global supply chain can’t happen overnight.
Clerc said it would take Trump “a decade or two of persistent effort” to reconfigure the world’s supply chains through tariffs, the Financial Times reported Thursday (May 8).
“The supply chain today around the world is something that has been built over decades,” he said, per the report. “If you want to upend it or change it in a deep way, it will take decades. It takes time for companies to make decisions, for factories to be built. It’s very unrealistic for supply chains to be changed very quickly due to tariffs.”
Trade volumes between the United States and China fell between 30% and 40% in April due to the tariffs, Clerc said, according to the report. However, routes between Asia and other emerging markets remained strong.
Denmark-based Maersk, the world’s second-largest container shipping group, is a bellwether for trade. It ships 20% of the world’s container volumes, the report said. The company warned Thursday that trade could decline this year, revising its earlier projection of 4% growth in container demand to a range from negative 1% to 4%.
Maersk is shifting 20% of its China-U.S. capacity to other routes, and the largest threat could be the fallout from the tariffs affecting the economy, Clerc said, per the report.
“If things become entrenched, inflation keeps increasing and we see a risk of recession in the U.S., then volumes will suffer in the second half,” he said, according to the report.
Clerc’s warning came amid other signs of the tariffs’ impact. For example, mergers and acquisitions (M&A) have dropped to their lowest level in 20 years, with deal-making now worse than during the Great Recession of 2008-09 and the COVID-19 pandemic. Additionally, some high-profile initial public offerings (IPOs) have been called off.
The May PYMNTS Intelligence report “Tariffs and Business Uncertainty: The Current State of Play” found that companies are uneasy about the impacts tariffs could have, with most businesses concerned about changes to supply chains.
“Mid-sized companies widely expect supply chain disruptions and rising costs, and those fears increasingly appear justified,” the report said. “Major U.S. ports are sounding alarms about precipitous drops in import volumes, and Walmart, Target and Home Depot CEOs warned Trump of product shortages and higher prices.”
