While the economy overall is strong and vehicle sales are still robust, there are risks in the industry that may affect the supply chain and cause disruptions throughout the year. Chief among these are the ongoing concerns regarding tariffs on products such as steel and aluminum, along with the on-again, off-again trade disputes with China.
In addition to the upheaval in global markets, the shift away from passenger cars and toward trucks and sport utility vehicles has caused automakers to realign their product offerings and even end the production of several car models. For suppliers, who have been dependent on contracts to provide parts for these vehicles, this realignment could be problematic. In addition, higher interest rates may complicate financing for businesses that need additional capital to address these changed circumstances.