- At just 1% growth, US manufacturing output barely increases
- Manufacturing import ratio increases by 9%
- Number of CEOs indicating reshoring plans increased 15% year-over-year
- Canada exports to US contracted; Mexico exports to US slowed down; imports from 14 Asian LCCRs increased by 10%
CHICAGO, April 30, 2025 -- Today, global strategy and management consultancy Kearney released its 2025 Reshoring Index: The great reality check, the firm's 12th annual report on reshoring. This year's Index conclusively demonstrates that when it comes to reshoring global manufacturing supply chains, the primary driver is the basic law of supply and demand. Even with a 50 percent rise in CEOs citing political tensions as a primary reshoring motivator, good intentions or political or executive rhetoric alone are not sufficient to keep up the reshoring momentum.
"The 2025 Reshoring Index points to a reality check that exposes the gap between reshoring intention and facts," noted Kearney partner and study co-author Patrick Van den Bossche. "Despite executives being more committed than ever, this year's report found the Reshoring Index turning back to negative territory, tied to global trade's most basic drivers—supply and demand. This decline should not be interpreted to mean reshoring is going away, just that expectations for the strategy need to be tempered by market realities."
In this latest edition, the manufacturing import ratio increased by 9 percent, back to pre-COVID levels, as imports from 14 Asian low-cost countries and regions (LCCRs) grew faster than US domestic manufacturing gross output. This led the Reshoring Index to decline by a whopping 311 basis points, falling back into negative territory after two very positive years. "This reversal shouldn't be seen as evidence that reshoring strategies are necessarily doomed, but it ought to serve as a very serious reality check," adds Van den Bossche.
Despite continued capital investment in recent years, US manufacturing output expanded by just 1 percent in the past year. This modest growth, half the rate of the US market's manufactured goods consumption increase, reflects a longer-than-expected lag between investment announcements and operational capacity coming online.
The US's principal nearshoring partners, Canada and Mexico, also struggled to keep pace with their recent historical performance. US imports growth from Mexico trailed the boom of the previous two years, while Canada recorded a year-over-year contraction in its exports to the US.
Addressing recent developments in Mexico, Kearney partner and report co-author Omar Troncoso noted, "As US demand outpaced what domestic production could supply, Mexico was not able to fill the gap. So, we saw manufacturers reverting to sourcing from those distant Asian low-cost countries and regions they had relied on in the past."
Led by categories such as computers, electronics, and electrical equipment, imports from Asian LCCRs including China increased by 10 percent or $90 billion.
Kearney's annual survey of reshoring activities and attitudes conducted in March 2025 in conjunction with the Reshoring Index report found the share of CEOs planning to reshore part of their operations in the next three years increased by 15 percent compared to last year. This indicates continued long-term interest in making more products in the US.
In an era of trade uncertainty, Kearney saw about a 50 percent rise in CEOs citing geopolitical tensions as a primary motivator for reshoring, underscoring how politics are increasingly shaping supply chain strategy.
But politics alone won't cut it, according to Patrick Van den Bossche. "This year's Reshoring Index report reveals a hard truth. While CEOs are more committed than ever to reshoring, the US domestic manufacturing ecosystem is still playing catch-up. The next phase will require not just capital, but coordination."
Read the full report here.
About the Kearney Reshoring Index
Launched in 2013, the Kearney Reshoring Index is a unique barometer for tracking the extent to which America is reshoring manufacturing back from those Asian countries that have benefitted for decades from the offshoring of US manufacturing operations. The Reshoring Index is determined by dividing the import of manufactured goods from the 14 Asian low-cost countries and regions (LCCRs) by the US domestic gross manufacturing output to calculate a manufacturing import ratio (MIR). The Reshoring Index reflects the year-on-year change in the MIR.
About Kearney
Kearney is a leading global management consulting firm. For nearly 100 years, we have been the trusted advisor to C-suites, government bodies, and nonprofit organizations. Our people make us who we are. Driven to be the difference between a big idea and making it happen, we help our clients break through. For more information, visit www.kearney.com.
US press contact:
Meir Kahtan
Meir Kahtan Public Relations
mkahtan@rcn.com | +1 917-864-0800
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