TRAVERSE CITY — Area manufacturers are working overtime to gauge the terms and impacts of the sweeping trade tariffs being levied by the Trump administration.
The ongoing fallout of President Donald Trump’s global tariffs and trade policies took center stage at last week’s Northern Michigan Manufacturing Summit. The event drew a record turnout of more than 180 area business people at the Hagerty Center in Traverse City, sponsored by Traverse Connect and the Grand Traverse Area Manufacturing Council.
“There is a lot of uncertainty — that’s the theme of the year so far,” said Kevin Courtois, vice president of government affairs for the U.S. Chamber of Commerce who’s based in Chicago. Courtois joined Traverse Connect President and CEO Warren Call for an afternoon panel discussion on the implications of tariffs, and their impacts on the country’s manufacturing sector and its global supply chains.
Courtois said the tariffs and trade policies were a factor in last week’s report from the U.S. Department of Commerce that showed the country’s Gross Domestic Product (GDP) contracted by 0.3 percent in first quarter 2025, the first negative quarter since 2022.
“What was really driving it was a 41 percent increase in imports,” he said. “We saw a lot of businesses front-loading; they knew the tariffs were coming and had talked about it, so they imported a lot more goods and stocked up so they had inventory.”
Courtois said foreign trade supports 41 million jobs in the U.S., and 8 million jobs are created by foreign companies investing in the U.S. In Michigan, international trade supports over 1 million jobs, with $81 billion in state exports to nearly 200 markets around the globe. The country’s top trading partners in order are Canada, Mexico and China, he said. About 50 percent of the country’s exports are for manufactured goods, he said.
Courtois outlined the rapidly evolving tariffs that been implemented by the Trump administration in recent weeks on various products and U.S. trading partners, along with a handful of pauses and delays on some of those trade policies and retaliatory tariffs slapped on the U.S. from other countries. Courtois also said there’s speculation about the potential for negotiating new trade agreements with some countries.
“There’s a lot going on here, and it does take a long time to figure exactly how all this is going to play out,” Call said.
DEALING WITH TARIFFS
One local manufacturer with longtime business ties in China shared his experiences dealing with the Trump tariffs.
Dodd Russell, CEO of Skilled Manufacturing Inc. based in Traverse City, said the auto parts division of his business has been operating in China for around 25 years, and the company opened its own manufacturing facility there five years ago. That facility ships parts to the U.S.
The company also manufactures aerospace and medical components.
“We’re directly affected by it,” Russell said. “We’re affected by the tariffs locally as we ship to Canada, we ship to Mexico, we receive from Mexico … we’re on all sides of it.”
The uncertainties in the tariff debate — the initial directives followed by various pauses and delays and the changing parameters of the tariff terms — are making it difficult for companies to plan and make business and financial decisions, the panelists said.
“In the morning it’s one way, in the afternoon it’s something else,” Russell said. “I think a lot of people are struggling with that. As we continue to struggle with that, it stops people from being able to make investments and include ourselves in the global economy.”
Dodd acknowledged there are trade imbalances and challenges around the globe, but questioned the Trump administration’s use of major tariffs on U.S. trading partners to address them.
“Do I think there’s trade issues and barriers in other countries? Definitely.” he said. “How we deal with them is just as important as identifying them.”
Dodd said most manufacturers supply parts on “razor-thin margins” to their customers and can’t survive the financial impact of triple-digit tariffs on their operations.
“You’re basically destabilizing the manufacturing base in our state specifically, as well as in our country … I think we have to understand that we are inside a global supply chain,” he said. “For me, there’s real consequences on a daily basis.”
Courtois described the tariffs as “a tax” on U.S. companies — not on trade partner countries — and that they are generating less revenue for the federal government than was first projected. The U.S. Chamber estimates that the tariffs as proposed will cost U.S. households about $4,000.
“This is a tax, we pay it — the business pays it and passes it on to the consumer,” Courtois said. “We’ll see higher prices at a point where inflation is a huge concern.”
Courtois also said that it takes at least three months for the tariffs’ impacted to be fully reflected in national economic data, and that the country has not yet seen their full ramifications on the state and local economy.
Call said the Northern Michigan Chamber Alliance, which represents 19 area chambers and economic development organizations and more than 7,000 member businesses from across northern Michigan, conducted a online survey of members seeking input on the impact of tariffs on their businesses.
Call said partial results from more than 200 area companies that responded show that while around 80 percent said the tariffs wouldn’t result in reductions of their workforce, close to 45 percent anticipate a “significant” reduction in revenue because of the tariffs, and almost 55 percent expected a negative impact to their business. About 5 percent of respondents expected a “potentially positive impact” to their business, he said.
Several of the specific concerns submitted in the survey related to the economic uncertainty created by the tariffs, Call said, whether or not a business is directly impacted by federal tariffs.
“’Uncertainty is our biggest concern — we can adapt to a number, but constant changes cause uncertainty which we feel will cause delays in purchases from our customers’,” Call said one respondent noted. “So those are some of the things we’re hearing thus far.”
Call said the Alliance will issue a summary of its survey result later this month, and share the information with the state and U.S. Chamber along with federal policy officials and lawmakers.
“One of our jobs is to make sure your reality gets translated to policy-makers … there are some (trade) issues, but hopefully we can address them with targeted approaches, rather than a sledgehammer,” Call said.
‘SILVER LINING’
Courtois said that while the economic uncertainty over the tariffs will continue for at least the near term, he recommended manufacturers take inventories on their suppliers, identify the source and destinations of their products, and carefully track their supply chains while the tariff debate continues to evolve. He said business leaders should share their concerns with their advocacy organizations and their congressional representatives.
“There is a silver lining — there are folks in the administration who are reaching out to the U.S. Chamber who want to know the real world economic impact, specifically for small businesses,” he said. “Share it with us — allow us to amplify your story and what’s happening to your business because of these tariffs.”
While the U.S. Chamber and other business organizations are at odds with the Trump administration over trade and tariffs, Courtois said the national chamber is behind other administration goals, including extension of the Tax Cuts and Jobs Act of 2017. It reduced the corporate tax rate to 21 percent from 35 percent, and included other business friendly tax changes including research and development tax credits and a 20 percent “pass-through” deduction that benefits small business.
“We are laser-focused on either making those (tax changes) permanent or getting them extended,” he said, adding that the organization is also hosting a series of tax roundtables with businesses around the country. The chamber is also pushing for various regulatory reforms and increased domestic energy production, he said.