Z2Data’sTariff Hub
Stay ahead of shifting tariffs and their impact on your supply chain with our Tariff Content Hub. Our comprehensive hub provides in-depth reports and insights to help you understand the latest developments in tariff rates, their specific impact on your business, and the most up-to-date strategies for compliance.
Tariff Watch, April 30
- On Thursday, April 24, Chinese Commerce Ministry spokesperson He Yadong addressed comments made by U.S. President Donald Trump earlier in the week that the two nations are participating in discussions around deescalation. While firmly denying that any trade talks had been taking place, He called on the U.S. to remove the “unilateral tariff measures” imposed on China. "The person who tied the bell must untie it," the spokesperson told reporters during a press conference.
- On Monday, April 28, reports continued to surface that a number of Asian nations, including South Korea, India, and Japan, were actively engaged in trade talks with the U.S. In addition, corporations are telling major outlets that the impact of the 145% combined tariffs on China will soon start to reverberate through their businesses. So far, retailers like Walmart and Target have been able to insulate themselves from the effects of disproportionately high duty rates because of existing inventory. But those stockpiles will start running out by the middle of May, and both companies have said that the transition into the new trade environment could include higher prices and even empty shelves—presumably owing to the suspension of supply chains in China.
- On Tuesday, April 29, President Trump signed two executive orders granting relief to the U.S. auto industry from a wave of costly tariffs. In the first and most consequential of the executive orders, Trump exempted automakers from any tariffs outside the 25% levy on imported vehicles that went into effect on April 3 (a related 25% tariff on auto parts is still set to be implemented on May 3). The second EO allows automakers to apply for tariff relief that could cover some of the costs associated with importing auto parts. This cost mitigation program is set to remain in effect for two years. Because the two 25% auto industry tariffs remain in effect, however, experts still expect the costs of vehicles, insurance, and repairs to rise markedly in the coming months.
Industry Response and Implications
As the Trump administration continues implementing tariffs and the global trade environment grows increasingly restrictive, U.S. businesses will need to start adapting their strategic approaches to key variables like COO, sourcing resilience, and import cost relief.
Your country of origin data may not be reliable
- The U.S. is expanding tariffs on goods from China and other high-risk regions.
- Enforcement is tightening, and officials are now digging deeper into country of origin.
- Firms need to know where critical operations occurred, where sub-assemblies were built, where raw materials were sourced, and whether your documentation can prove it.
Most companies manage COO today through:
- Static COO entries in their ERP
- Supplier or contract manufacturer declarations
- Assumptions tied to final assembly location or shipping origin
Why that approach may no longer be effective:
- Today’s enforcement environment demands more than surface-level origin data.
- U.S. Customs now asks for documentation showing where each meaningful transformation occurred, not just a COO label.
- Even if your records say one thing, officials may disagree. That creates both risk and cost.
What companies should do now:
- Validate COO at the part, assembly, and sub-assembly level.
- Map out where key manufacturing operations and transformations actually occur.
- Build documentation that stands up to audit or regulatory inquiry
- Ensure contract manufacturers and EMS providers are collecting COO data.
- Define responsibility for COO data in supplier contracts and business terms.
Sourcing teams are scrambling to react—again
- New and reinstated U.S. tariffs are hitting industries with little warning, especially those dependent on Chinese-made goods, critical materials, and high-tech components.
- Sourcing teams are being forced into reactive mode—tracking costs, shifting suppliers, and racing to find alternate parts after enforcement has already begun.
Most sourcing strategies today rely on:
- Historical supplier performance
- Static cost models
- Single-source or region-dependent contracts
- Limited awareness of geopolitical or regulatory risk
The current reactive approach leads to:
- Sudden cost spikes from unplanned tariffs
- Inability to meet delivery timelines due to supplier delays
- Risk exposure from non-compliant or high-risk countries of origin
- Strategic sourcing initiatives getting sidelined in favor of damage control
What forward-thinking companies are doing now:
- Building diversified, multi-region supplier strategies
- Modeling parts and suppliers against current and proposed tariff rules
- Identifying and qualifying alternate parts before risk hits
- Mapping sub-tier suppliers and gauging risk exposures
Teams are under pressure to find tariff-free sourcing alternatives
- Procurement needs to reduce China exposure, diversify supply chains, and lower costs.
- These asks often come with limited context, no starting point, and short turnarounds.
- Finding the right part with the right specs without inviting risk has never been harder.
Most sourcing teams rely on:
- Manually maintained AVL or AML spreadsheets
- Supplier suggestions without transparent origin data
- Time-consuming research or incomplete customs classifications
- Trial and error when searching for alternatives
Why that approach may no longer be effective:
- Untimely data leads to alternates that still fall under high-duty categories
- Risks from substituting parts without full analysis of form, fit, and function
- Time lost negotiating with CMs who can’t support high level of sourcing analysis
- Suppliers in lower-risk regions are overlooked
What companies should do now:
- Analyze their full AML for tariff exposure and origin variability
- Segment parts by tariff tier and identify the highest-risk components
- Map supplier sites and COO to validate eligibility under current trade rules
- Seek sourcing alternatives that offer multiple COO options with lower tariff tiers
How Z2Data can help
- For COO: Z2Data provides the intelligence and traceability to handle COO risk with maximum clarity and control.
- For Proactive Sourcing: Manage risk exposure by mapping supplier sites, identifying crosses, and accessing data across over one billion components.
- For Tariff Reduction: Analyze your entire AML, identify lower-tariff alternates, and see which parts have multiple COOs with divergent tariff rates.
But based on our HTS comparison, key components are still exposed, including capacitors, resistors, connectors, sensors, electromechanical parts, and hardware components.
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How Can Companies Determine What Imports Are Subject to Tariffs?
In order to determine whether their imports are subject to tariffs—and what those tariff rates are—businesses can search the U.S. International Trade Commission Tariff Database. When navigating the USITC database, users can either search based on the product itself, or use the product’s HTS code—the 10-digit harmonized tariff schedule code assigned by the International Trade Commission. While searching by the specific item can give users a good indication of the duty rate, referencing a specific HTS code will yield more precise information on tariff figures.
How Are Tariffs Impacting the Electronic Component Supply Chain?
Tariffs are reshaping the global electronics supply chain by increasing costs, impacting sourcing strategies, and complicating supplier relationships. On January 1, 2025, the tariff rate on semiconductors imported from China increased from 25% to 50%, based on actions taken by the Biden administration. Since then, President Trump has imposed additional tariffs totalling 145% on Chinese imports (certain product categories have received exemptions).
Though semiconductors have been excluded from Trump’s reciprocal tariffs, U.S. businesses importing semiconductors from China are still paying a staggering 70% total in U.S. tariffs on those chips. Likewise, with a 25% tariff already in place on printed circuit boards (PCBs) imported from China, companies are now paying a combined 45% tax on those goods.
In addition, President Trump’s reciprocal tariffs, which went into effect on April 5 and April 9, respectively, expanded the impact of trade restrictions far beyond China. On April 9, the Trump administration imposed the following across-the-board tariffs, along with many others (currently, semiconductors, pharmaceuticals, and a number of critical minerals are exempt from these reciprocal tariffs):
- 46% on Vietnam
- 36% on Thailand
- 32% on Indonesia
- 27% on India
- 25% on South Korea
- 24% on Japan
- 24% on Malaysia
- 20% on all EU nations
On Wednesday, April 9, President Trump issued a 90-day pause on the implementation of most of his reciprocal tariffs—though China was excluded from the reprieve.
This remains a highly dynamic situation, with major developments on a weekly, daily, and sometimes even hourly basis.
Are Tariffs Changing the Way Companies Source Parts?
Tariffs are changing the way companies source parts to a limited degree—so far. A number of large corporations in the automotive and consumer electronics sectors have either announced plans to reshore some of their manufacturing to the U.S. or are seriously considering expanding their American manufacturing operations. These companies include Honda, Hyundai, Samsung Electronics, LG Electronics, Volkswagen, and Volvo. It’s important to bear in mind, however, that many of these plans are preliminary and subject to change based on the evolution of the Trump administration’s tariff regime and its impact on global supply chains.
What Are the Disadvantages to Onshoring Manufacturing to the U.S. to Avoid Tariffs?
Companies that want to reshore their manufacturing to the U.S. to avoid the Trump administration’s tariffs will be forced to reckon with several critical obstacles. The first and most well-known of these drawbacks is price. Businesses currently sourcing in countries like China, Vietnam, and Malaysia are going to face immediate cost increases if they shift some or all of their manufacturing inputs to American suppliers.
But higher prices are not the only issue that original equipment manufacturers (OEMs) and other companies could encounter when reshoring. The U.S.’s manufacturing capacity is not currently equipped to handle droves of businesses in industries like automotive, semiconductors, consumer electronics, and telecommunications abruptly shifting their sourcing to America, and such a large-scale supply chain “migration” could trigger shortages and other disruptions. In addition, although quality is rarely invoked as an issue in U.S. manufacturing, not all the facilities companies would be transitioning their sourcing to in America have the same expertise and efficiency as their counterparts in China and elsewhere.
Finally, companies contemplating reshoring their manufacturing to the U.S. have to grapple with the instability of the current trade environment. Establishing a manufacturing base in the U.S. will take many businesses months and even years—and there’s zero guarantee that this unprecedented tariff regime will still be in place in 2026 or 2027, providing the same incentive structure to do so.
Who Absorbs the Costs of Tariffs?
Nominally, the importing business is always responsible for paying the tariffs to the government of its home country. American OEMs who are importing semiconductors from manufacturers based in China, for example, are currently paying a 70% tariff to the U.S. government. From a legal trade compliance perspective, the Chinese manufacturers supplying those semiconductors have zero responsibility for paying those tariffs.
Are U.S. Importers Negotiating with Suppliers to Mitigate Tariffs?
How U.S. importers navigate tariff costs with their suppliers and distributors varies widely. Contract negotiations are often complex, and there’s no one-size-fits-all solution for determining who ultimately absorbs the added expense. In order to retain their customers and remain competitive, some foreign suppliers may agree to lower their prices to reduce the cost burden on their U.S. customers. Distributors are another stakeholder in the supply chain, and OEMs may also try to negotiate with them to help offset import taxes. But while these negotiations vary between industries and supply chains, suppliers and distributors are generally resistant to helping cover the costs of tariffs—unless, of course, their business is at stake.
We’re still in the early days of this new U.S. trade regime, and it’s very likely that these dynamics will continue to evolve as the stakes get higher, more clarity and consistency is established, and foreign suppliers start facing the prospect of losing their customers to U.S. manufacturers.
How Does Customs and Border Protection Determine Country of Origin for Imports?
When it comes to determining the Country of Origin (COO) for imports, the U.S. International Trade Administration and Customs and Border Protection adhere to the legal principle of substantial transformation. According to the USITA, “Substantial transformation means that the good underwent a fundamental change in form, appearance, nature, or character” that “adds to the good’s value at an amount or percentage that is significant.”
Determining a COO can be a complex process. For example, if an import was wholly manufactured in a single country, then that nation is the COO. But many products undergo manufacturing inputs in several different countries, making the COO determination significantly less straightforward. For goods with manufacturing inputs from multiple nations, government officials will assign the COO based on the final location where a substantial transformation took place.
What Other Strategies Are Companies Using to Offset Tariffs?
To offset the costs associated with the Trump administration’s tariffs, companies are likely to start pursuing a number of strategies, including:
- Negotiating with their direct suppliers—and in some cases even their sub-tier manufacturers—to help share the burden of tariffs.
- Focusing their strategies on trying to modify the country of origin, working with their suppliers to tweak manufacturing processes or other steps to shift the COO to a country with a lower tariff rate.
- Potentially restructuring their supply chain to diversify away from countries like China, Vietnam, and Thailand, which all now have tariff rates over 30%.
Finally, organizations are also exploring opportunities with foreign trade zones and tariff exclusions, which are outlined in greater detail below.
How Do Companies Apply for Tariff Exclusions?
While the Trump administration has not outlined a specific exclusion request process for the tariffs imposed in 2025, in the past businesses went to the United States Trade Representative (USTR) website and filled out an exclusion request form. These forms typically required detailed information about the product in question, including its Harmonized Tariff Schedule (HTS) code, the rationale for exclusion, and the economic impact of the tariff on the company. Companies were also encouraged to provide evidence that the product was not readily available from domestic sources or from countries not subject to the tariff.
Many businesses eventually took this route during the first Trump administration, when the president implemented sectoral tariffs on steel and aluminum and a country-specific tariff on China. According to the Congressional Research Service (CRS), around 13% of the exclusion requests for Chinese imports were approved during the first Trump administration—though some companies reported much higher success rates.
Can Foreign-Trade Zones (FTZs) Protect Importers From Tariffs?
Foreign-trade zones (FTZs) are specially designated sites that are supervised by CBP but are legally considered outside U.S. customs territory. In practice, this means that imports can be moved into FTZs without needing to pay tariffs or any other related import taxes. Goods transferred into these zones only trigger these duty payments if and when they exit the FTZ and enter the U.S. for consumption. If they’re re-exported to another country, the original importer may not have any tariff responsibility at all.
FTZs offer importers two primary benefits. First, they function as tax shelters where businesses can defer import payments. Second, importers can carry out a range of different processes on imported goods in FTZs, including assembly, manufacturing, and processing. If businesses are able to modify the import so that it technically fits into a different product category with a lower tariff rate, then they are only responsible for paying the lower rate. Firms must remember, however, that any manufacturing steps carried out in FTZs that result in a substantial transformation that changes the CBP classification of the import must be authorized by the FTZ Board