Series of 4 special topics Oxford Economics’ research briefings are now available. These briefings cover topics such as supply chain disruptions, impacts of a Greenland trade war, and automotive production growth. Brief overviews of the articles are highlighted below:
US: Fundamentals point to easing supply-chain stress
- Oxford Economics’ tracker for supply-chain stress has steadily declined since July 2025. Low freight rates and manageable trade volumes suggest easing supply-chain stress will continue in 2026. Global oil prices expected to fall throughout 2026 benefit the supply chain and offset other, less impactful stressors. Restrictions on immigrant truck drivers have the potential to cause high truck rates to be stickier. The broader US economy will continue to wrestle with higher policy uncertainty in 2026. On the bright side, despite large policy-driven swings in trade, supply-chain stress has not been inflationary.
Global: Memory chip shortage is a headache for supply chains
- Current memory chip shortage is due to the explosive AI boom and demand for cutting-edge memory chips. Electronics, electrical machinery and automobile manufacturer purchasers of memory chips are expected to be harmed by the shortage and resulting price increases. Memory chipmakers will benefit from soaring prices while downstream manufacturers will face increased input costs. The memory chip shortage is expected to be an ongoing issue over the next few years as the AI boom continues on.
Global: Greenland trade war could significantly dampen industrial outlook
- President Trump’s proposed tariffs on the European Union would stall European manufacturing through 2026, with especially severe effects on trade‑dependent sectors such as machinery, automotive, pharmaceuticals, and high technology. The European Union’s industrial activity would face a permanent reduction of about 1.5 percent, although domestic defense and infrastructure spending is expected to support a recovery beginning in 2027. The United States would also experience a short‑term slowdown due to increased uncertainty but would recover more quickly because its industries rely less on international trade.
US: Automotive production growth to remain sluggish this year
- US automotive production is expected to remain weak in 2026 because financing costs are still elevated and automakers are likely to pass more of the tariff burden onto consumers, keeping new vehicle payments unusually high. Trade policy uncertainty continues to shape industry decisions, encouraging some firms to shift production to the United States even though higher labor and operating costs make these adjustments slow and uneven, while a reduced outlook for electric vehicle production reflects policy reversals and softer consumer demand.
If you have any questions about interpreting or using the data in these reports, please contact Cecilia Bart at cbart@nfpa.com.