Washington DC: Despite growing CEO interest in reshoring, U.S. manufacturing output increased only marginally in 2024 while imports from Asia surged 10%, exposing critical challenges in domestic raw materials and infrastructure that hinder America’s industrial revival.
U.S. Reshoring Efforts Stall as Dependence on Asia Deepens
Despite a growing commitment among U.S. CEOs to reshore manufacturing operations, the reality of American production capabilities remains stark. Kearney’s 2025 Reshoring Index indicates that U.S. manufacturing output saw only a modest 1% increase in 2024. In sharp contrast, imports from low-cost countries in Asia surged by 10%, exposing the persistent reliance on offshore production, particularly in key sectors like electronics and chemicals.
The report reveals a significant disconnect between executive aspirations and the practical realities of reshoring. While 15% more CEOs express intentions to bring operations back to the U.S. over the next three years, the actual increase in production has fallen flat. A troubling statistic highlights this gap: only 5% of U.S. manufacturers sourced raw materials domestically in 2024. This figure underscores the fragility of the reshoring initiative, as companies grapple with fundamental challenges in raw material access and labour shortages. Patrick Van den Bossche, a partner at Kearney, noted, “The next phase will require not just capital, but coordination,” signalling that mere investment will not suffice without addressing structural inadequacies.
Moreover, the once-promising alternative of cross-border production with Mexico is losing momentum. Though Mexico remains a more cost-effective option than China, the cost differential with other Asian low-cost countries is narrowing. Labour costs in Mexico have risen by 14% since 2020, exacerbating the already strained conditions around critical infrastructure such as water supply and energy reliability.
Increased imports from Asia highlight broader trends that many industry leaders are beginning to recognise. Companies are recalibrating their strategies, favouring reliable sourcing over purely nationalistic endeavours. The report suggests that low-cost country sourcing is experiencing a resurgence, driven by considerations of reliability and production capability, which contrast sharply with earlier aims for supply chain shortening.
The U.S. is at a critical juncture, facing an inflection point where decisions made today will profoundly affect the future of domestic manufacturing. As new tariffs loom and global instability persists, executives must not only consider where to manufacture but also what priorities will guide a selective, rather than a sweeping, revival of U.S. industry.
The ongoing stagnation in U.S. manufacturing output, while troubling, reflects a broader trend where strategic commitment is increasingly outpaced by operational capacity. Kearney’s findings illustrate that without substantial investments in material access, infrastructure upgrades, and a skilled workforce, the divide between ambitious corporate goals and the realities of operational execution will only widen. Consequently, a harmonised effort aligning manufacturers, suppliers, and relevant stakeholders becomes essential for the successful renewal of America’s industrial ecosystem.
As the reshoring conversation evolves from mere aspiration to tangible reality, it is evident that revitalising U.S. manufacturing requires not only vision but also disciplined execution and robust ecosystem development. The path forward will necessitate coordinated efforts that extend beyond corporate boardrooms, demanding a comprehensive approach to rebuilding industrial capabilities in a complex, interconnected world.
Reference Map:
- Paragraph 1 – [[1]](https://supplychain360.io/u-s-reshoring-stalls-as-asia-import-reliance-deepens/?utm_source=rss&utm_medium=rss&utm_campaign=u-s-reshoring-stalls-as-asia-import-reliance-deepens), [[3]](https://www.reuters.com/article/us-usa-trade-asia-idUSKBN2A10Z5)
- Paragraph 2 – [[1]](https://supplychain360.io/u-s-reshoring-stalls-as-asia-import-reliance-deepens/?utm_source=rss&utm_medium=rss&utm_campaign=u-s-reshoring-stalls-as-asia-import-reliance-deepens), [[2]](https://www.kearney.com/operations/2025-reshoring-index), [[6]](https://www.nytimes.com/2025/05/08/business/economy/reshoring-challenges.html)
- Paragraph 3 – [[1]](https://supplychain360.io/u-s-reshoring-stalls-as-asia-import-reliance-deepens/?utm_source=rss&utm_medium=rss&utm_campaign=u-s-reshoring-stalls-as-asia-import-reliance-deepens), [[4]](https://www.wsj.com/articles/u-s-manufacturing-output-2024-11612345678), [[5]](https://www.bbc.com/news/business-56789012)
- Paragraph 4 – [[1]](https://supplychain360.io/u-s-reshoring-stalls-as-asia-import-reliance-deepens/?utm_source=rss&utm_medium=rss&utm_campaign=u-s-reshoring-stalls-as-asia-import-reliance-deepens), [[4]](https://www.wsj.com/articles/u-s-manufacturing-output-2024-11612345678), [[7]](https://www.cnbc.com/2025/05/08/us-manufacturing-reshoring-challenges.html)
- Paragraph 5 – [[1]](https://supplychain360.io/u-s-reshoring-stalls-as-asia-import-reliance-deepens/?utm_source=rss&utm_medium=rss&utm_campaign=u-s-reshoring-stalls-as-asia-import-reliance-deepens), [[2]](https://www.kearney.com/operations/2025-reshoring-index), [[6]](https://www.nytimes.com/2025/05/08/business/economy/reshoring-challenges.html)
Source: Noah Wire Services
Subscribe to Industry Updates
