91%
Of manufacturing leaders report equal or more aggressive cost-reduction targets compared to last year.
Insight
Navigating Tariffs, Cost Pressure & Opportunity: Are U.S. Manufacturers Delaying the Future?
U.S. Manufacturers Entering 2026 Under Cost Pressure
Many manufactures are responding by postponing the very investments that could strengthen long-term competitiveness. Tariff uncertainty, rising energy costs, and concerns over the broader economy are driving companies toward short-term cost takeout rather than strategic cost reduction.
New research from EFESO Management Consultants, in partnership with Endeavor Business Intelligence, surveyed 150 manufacturing executives across North America. The findings reveal a clear tension: while 91% of leaders face equal or more aggressive cost-reduction targets than last year, most are prioritizing deferral tactics over the high-value investments that improve cost structures over time.
The Bigger Picture
Across the sector, meaningful shifts from 2024 to 2025 show manufacturers moving to a crisis footing: cutting capital spending, postponing modernization, and deprioritizing quality improvements — even as long-term risks accumulate. The data suggests that companies delaying design-to-value, automation, and asset modernization may face structurally higher costs by 2026.
Ownership structure also shapes resilience. Private companies tend to take a longer-term view, while public and PE-backed firms report the most aggressive goals — and the greatest reliance on deferral strategies.
83%
Say AI is becoming essential to meeting cost-takeout goals, especially in automation, predictive maintenance, and energy optimization.
75%
Cite tariffs as one of their most pressing macroeconomic concerns for 2026.
50%
Fear that delaying strategic investments could lead to customer attrition.
Explore the 2026 State of the Manufacturing Industry Report
In a landscape defined by volatility, the manufacturers that balance immediate cost pressure with disciplined, forward-looking investments will be best positioned to protect competitiveness, absorb shocks, and scale efficiently.
Read the full 2026 State of the Manufacturing Industry Report to understand where leading manufacturers are cutting, where they are investing, and how they are turning cost pressure into long-term opportunity.
Explore the 2026 U.S. Industry Report
Read the full report to understand where leading manufacturers are cutting, where they are investing, and how they are turning cost pressure into long-term opportunity.
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