Member Briefing March 27, 2025
Durable-Goods Orders Rose As Manufacturers Tried To Beat Tariffs
Orders for long-lasting durable goods rose almost 1% in February as U.S. manufacturers rushed to procure supplies ahead of the Trump administration’s tariffs on foreign steel and aluminum. Orders for primary metals and appliances surged for the second month in a row, the government’s report on durable goods showed. These are big-ticket products meant to last at least three years. Manufacturers were hoping for a recovery this year after a prolonged slump, but White House trade fights have raised the specter of rising costs.
Companies have responded by speeding up orders before the tariffs took effect in March — causing metal producers to raise prices. Domestic producers tend to increase prices when tariffs raise the costs of foreign-produced metals. Aside from strong demand for metals, orders for new autos and military aircraft also showed strength. U.S. carmakers have also tried to beat pending Trump White House tariffs on parts and vehicles from Mexico and Canada. The new administration also plans to build more defense fighters. A big reason durable-goods orders did not decrease as expected was because of a smaller-than-expected decline in orders for passenger planes.
Trump Announces 25% Tariffs On All Cars ‘Not Made In The United States’
Wednesday, President Trump signed a proclamation invoking Section 232 of the Trade Expansion Act of 1962 to impose a 25% tariff on imports of automobiles and certain automobile parts.
- The 25% tariff will be applied to imported passenger vehicles (sedans, SUVs, crossovers, minivans, cargo vans) and light trucks, as well as key automobile parts (engines, transmissions, powertrain parts, and electrical components), with processes to expand tariffs on additional parts if necessary.
- Importers of automobiles under the United States-Mexico-Canada Agreement will be given the opportunity to certify their U.S. content and systems will be implemented such that the 25% tariff will only apply to the value of their non-U.S. content.
- USMCA-compliant automobile parts will remain tariff-free until the Secretary of Commerce, in consultation with U.S. Customs and Border Protection (CBP), establishes a process to apply tariffs to their non-U.S. content.
European Commission President Ursula von der Leyen quickly criticized the new U.S. tariffs and vowed that the European Union “will continue to seek negotiated solutions, while safeguarding its economic interests.” “Tariffs are taxes — bad for businesses, worse for consumers equally in the US and the European Union,” she said in a statement. Auto stocks fell in after-hours trading following Trump’s announcement. Shares of General Motors, Stellantis and Ford Motor all lost roughly 5% in extended trading.
Read the White House Press Release
Mortgage Demand Hits Two-Month High, Driven By FHA Applications
Mortgage rates barely budged last week, but homebuyers may be inching back to the market despite strong spring headwinds. Applications for a mortgage to purchase a home rose 1% for the week and were 7% higher than the same week one year ago. That small gain, after weeks of declines, was enough to put demand at the highest level in nearly two months. Refinance demand was weaker, however, pushing total application volume down 2% last week from the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances, $806,500 or less, decreased to 6.71% from 6.72%, with points dropping to 0.60 from 0.64, including the origination fee, for loans with a 20% down payment. “Last week’s purchase activity was driven primarily by a 6 percent increase in FHA applications, as the combination of loosening housing inventory and slowly declining mortgage rates have presented this segment of buyers with more opportunities,” Joel Kan, an MBA economist, in a release.
Global Headlines
Middle East
- Hundreds Join Gaza's Largest Anti-Hamas Protest Since War Began – BBC
- U.S. Builds up Military in Indian Ocean in Warning to Iran - Newsweek
- One Syrian Father’s Journey to Find His Son – WSJ
- World Cup 2026: Iran Qualifies After Draw With Uzbekistan - ESPN
- Israel’s New Spending Plan Is a Win for Netanyahu - NYT
- Turkish Inflation Expectations Tick Up After Market Turmoil: Reuters Poll - Reuters
- Interactive Map- Israel’s Operation In Gaza – Institute For The Study Of War
- Map – Tracking Hamas’ Attack On Israel – Live Universal Awareness Map
Ukraine
- Moscow, Kyiv Trade Blame For Strikes Endangering Truce Efforts – France 24
- Russia Denies Reports of New Border Incursion by Ukraine in Belgorod - Newsweek
- U.S. Agrees to Help Russia Boost Exports in Ukraine Talks - WSJ
- Russia Convicts Captured Ukrainians On Terrorism Charges, Kyiv Denounces Sham – France 24
- Russia Says Sanctions Must Be Lifted Before Ukraine Maritime Ceasefire Can Start - BBC
- Interactive Map: Assessed Control Of Terrain In Ukraine – Institute For The Study Of War
- Map – Tracking Russia’s Invasion Of Ukraine – Live Universal Awareness Map
Other Headlines
- The U.S. Missile Launcher That Is Enraging China - WSJ
- U.K. Boosts Military Spending and Cuts Welfare in ‘Uncertain World’ - NYT
- A Visual Guide To Critical Materials And Rare Earths – The Economist
- What Tariffs? Another China GDP Forecast Rises On Fast Start, Capital Outlays - SCMP
- Brazil's Supreme Court To Decide Whether To Put Bolsonaro On Trial - BBC
- Why China Is Betting On Birth Subsidies To Solve Its Population Crisis - SCMP
- US Sends 'Nuke Sniffer' Plane on Western Pacific Mission - Newsweek
- Tackling Climate Crisis Will Increase Economic Growth, OECD Research Finds – The Guardian
Policy and Politics
Tax Cuts, Debt Ceiling Agreement Edge Closer, Says GOP
Republican leaders say they are getting close to agreeing on a plan to pass an extension of President Donald Trump’s 2017 tax cuts and an increase to the debt ceiling, as Congress looks to approve an economic package by the end of May. “I don’t want to get out in front of what the Senate is going to do. But it sounds like we will not be far apart, and that’s a good thing, so we’ll be able to move,” House Speaker Mike Johnson told reporters, following a meeting at the Treasury Department on Tuesday.
Johnson said the Senate was “coming around” to supporting a debt ceiling increase as part of the legislation. Senate Majority Leader John Thune said he believes “there’s consensus forming around” the debt ceiling plan, an issue that had been a key sticking point between the two chambers for weeks. Republicans are hoping to score a legislative win to soothe markets that have been roiled by the haphazard rollout of Trump’s tariff policies. Party leaders have warned that failing to extend the 2017 tax cuts, which expire at the end of the year, for individuals and privately held businesses could upend markets and economic expectations.
Over 9 Million Student Loan Borrowers Past Due After Bills Restarted, Fed Estimates
Around 9.7 million student loan borrowers became past due on their bills after the Covid-era payment pause expired, according to a new estimate by the Federal Reserve Bank of New York. After the Covid-era pause on federal student loan payments lapsed in September 2023, the Biden administration offered borrowers a 12-month “on-ramp” to repayment. During that time, borrowers were shielded from most of the consequences of falling behind on their payments. That relief period concluded on Sept. 30, 2024.
By the end of the off-ramp period, the New York Fed estimates that the volume of past-due federal student loans hit 15.6%, with more than $250 billion in delinquent debt. “According to these numbers, it is reasonable to expect student loan delinquency to surpass pre-pandemic levels when new delinquencies hit credit reports,” the Fed’s report says. A new student loan delinquency can cause a borrower’s credit score to drop more than 150 points, the Fed warns.
Trump Says Tariffs Coming In April Will ‘Probably Be More Lenient Than Reciprocal’ Here is Where Things Stand Today
President Donald Trump said that tariffs will likely be more “lenient than reciprocal,” as the April 2 tariff deadline looms for a number of levies to go into effect. “I’ll probably be more lenient than reciprocal, because if I was reciprocal, that would be very tough for people,” Trump said Tuesday in an interview with Newsmax. “I know there are some exceptions, and it’s an ongoing discussion, but not too many, not too many exceptions,” the president added.
Here's the latest on where things stand on various other, related fronts:
- Steel and aluminum: A 25% US tariff on imports of steel and aluminum from all countries took effect on Wednesday, March 12.
- European Union: The EU has responded to those metals duties with counter-tariffs on $28 billion in US goods from April, bringing Trump's trade war across the Atlantic. However, the EU delayed the implementation of some of those tariffs until mid-April — including a 50% duty on American whiskey, which had prompted Trump to threaten a 200% tariff on European spirits.
- Canada and Mexico: Trump's 25% across-the-board tariffs on its US neighbors went into effect on Tuesday, March 4. Just two days later, Trump confirmed the US would pause tariffs on goods and services compliant with the United States-Mexico-Canada Agreement (USMCA) until April 2. For its part, Canada retaliated to the steel and aluminum tariffs with new duties on about $20 billion of US goods. The two countries have agreed to new trade talks.
- China: Trump has enacted new blanket tariffs of around 20% on top of existing 10% duties that went into place during Trump's first term. China has responded with up to 15% duties on US farm goods such as chicken and pork, which went into effect Monday, March 10.
- Venezuela: Trump said the US will impose a "secondary tariff" on Venezuela, to take effect on April 2 — any country that buys oil or gas from Venezuela would face a 25% tariff when trading with the US.
Trump’s First 100 Days
- The Atlantic Publishes Full Signal Thread With Hegseth, Waltz After Trump Says Texts Not Classified – CNBC
- Judge Blocks Efforts To Arrest Columbia Student Protester - BBC
- Man Selling Fake Social Security Cards Arrested by ICE - Newsweek
- Treasury Department Is Set To Lay Off A ‘Substantial’ Number Of Employees, Official Says - CNBC
- Trump Takes Bid To Slash Teacher Training Funds To US Supreme Court - Reuters
- ‘A Lot Closer Than People Expected’: GOP Worries, Dem Cash Dominate Tense Florida Special Election - Politico
- Democrat Wins Special State Senate Election In Pennsylvania In Major Upset – The Hill
- U.S. Prosecutors Probe Tip About Timing of Pfizer Vaccine and 2020 Election - WSJ
- Trump’s War On Public Media Comes To Congress - Politico
- US Lawmakers Push For Action On Signal Breach, Warn Of 'Mourning Dead Pilots' - Reuters
- JD Vance Will Join Wife In Greenland But Trip Scaled Back - BBC
- Trump Takes Tough New Approach to Choking Off China’s Access to U.S. Tech - WSJ
- The Trump Tracker, Stay Up To Date on the First 100 Days – WSJ
Health and Wellness
How the Pandemic Transformed Workplace Mental Health Strategies
It seems nearly impossible to believe, but this month marks five years since the start of the Covid-19 pandemic and mandatory lockdowns. The world came to a standstill—offices shuttered, routines shattered, and uncertainty reigned. The pandemic upended every aspect of life. Perhaps one of the most profound and lasting shifts has been in how we think about mental health at work. Employees now see organizations as integral to the mental health solution—and for good reason. There’s been a profound shift in how employees and CEOs view mental health: It’s a good investment for both parties. Rather than a personal issue to be handled behind closed doors, mental wellness is a key driver of business success.
Furthermore, forward-thinking business leaders recognize that creating a mentally healthy workplace culture starts at the top. After all, employees take their cues from leadership. When those in upper management openly prioritize mental well-being, it offers permission—and even encouragement—for the entire organization to do the same. Leaders who model the behaviors they want to see are not shying away from openly taking time to disconnect, sharing their struggles, or talking about mental health.
Industry News
EPA Deregulation Efforts Could Take Months Or Years, Experts Say
The U.S. Environmental Protection Agency launched an extensive deregulation effort March 12, involving 31 actions meant to alleviate federal government oversight of climate-related rules. The actions affect various industries, including manufacturing, and are part of EPA Administrator Lee Zeldin’s “Powering the Great American Comeback” initiative that aims to create more jobs and grow the U.S. economy.
Manufacturing trade groups such as the National Association of Manufacturers and the American Chemistry Council lauded the efforts, as they have previously urged Congress to curtail oversight, arguing it prevents innovation. However, many of these deregulations won’t happen overnight, according to experts. The rules finalized under President Joe Biden will stay put as the EPA prepares to launch a comment period for each of the 31 reconsidered statutes, which could take months or even years. The process could also be stalled by possible job cuts at the EPA, as well as potential legal battles from citizens and states that challenge the deregulations.
Read more at Manufacturing Dive
Mid-Atlantic Factory Gauge Slows To -4 In March, Price Indexes Rise
Fifth District manufacturing activity slowed in March, according to the most recent survey from the Federal Reserve Bank of Richmond. The composite manufacturing index fell to −4 in March from 6 in February, led by a notable decrease, from 12 to −7, in the shipments index. Of its other two component indexes, new orders decreased slightly to −4, and employment fell to −1 from 9.
The local business conditions index dropped from −5 in February to −13 in March, while the index for future local business conditions fell notably from 2 to −22. The future index for shipments fell from 13 to 7 and the future index for new orders edged down to 6. The vendor lead time index increased to 12 in March, while the backlog of orders index rose from −6 to −1. The average growth rate of prices paid increased notably. The average growth rate of prices received increased, but not by as much. Firms expected heightened growth in prices paid and some growth in prices received over the next 12 months.
Cleveland-Cliffs Idling Steel Plant, Mining Sites as Auto Orders Slow
Facing a slowdown among their large automotive clients, the leaders of Cleveland-Cliffs Inc. have in recent days said they will idle two plants in Minnesota and another in Michigan and lay off roughly 1,200 workers. Set to be temporarily closed are Cliffs’ steel plant in Dearborn, near Detroit, as well as facilities in Hibbing and Virginia in northern Minnesota that make pellets. In Michigan, Bloomberg news reported that Cliffs will begin laying off employees in July; reports from Minnesota say the company will let people go by late May. The 1,200 workers affected account for about 4% of the company’s U.S. labor force as of the end of last year.
Company officials say that the moves in both states are focused on adjusting capacity as auto manufacturers slow their production pace. Cliffs Chairman, President and CEO Lourenco Goncalves has been a vocal supporter of the Trump administration’s efforts to use tariffs in favor of U.S. steel production. A month ago, Goncalves reported a fourth-quarter loss of more than $430 million—which he blamed partly on lower U.S. auto production—but said orders had begun to turn nicely early this year.
Nippon Steel Shares View With Washington That U.S. Steel Deal Will Boost U.S. Industry
Nippon Steel's president said on Monday that the Japanese steelmaker and the U.S. government share a mutual understanding that its planned acquisition of U.S. Steel will strengthen the American steel industry and manufacturing sector. "In my opinion, the U.S. government and we are moving closer to a mutual understanding that our acquisition of U.S. Steel will help strengthen the U.S. steel industry and manufacturing through investment, including equity participation," Nippon Steel President Tadashi Imai told reporters.
Japan's biggest steelmaker and U.S. Steel will continue negotiations with the U.S. government to reach an agreement on the terms of the equity purchase and future investment plans, he added, while declining to provide any further details. The administration of U.S. President Donald Trump filed a motion to extend two deadlines in U.S. Steel and Nippon Steel's lawsuit against a U.S. national security panel to give the government more time to wrap up merger talks with the firms, a filing showed last week.
First-Quarter US Earnings Outlook Looks Less Rosy With Tariff Worries In Focus
Analysts are turning more cautious on U.S. corporate earnings for the first quarter of this year, with the Trump administration's policies threatening to trigger a global trade war that could undermine economic growth. Apple, Tesla and Ford Motor are among companies contributing the most to recently lowered estimates for the quarter, along with some insurers, whose projections have been hurt by fires in California early this year, according to Tajinder Dhillon, senior research analyst at LSEG.
S&P 500 forecasts for the first quarter of 2025 have fallen by 4.5 percentage points since January 1, the largest downward revision since the fourth quarter of 2023, he said. Earnings growth for S&P 500 companies is now seen at 7.7% year-over-year, which would be the lowest since 2023's third quarter and a big decline from 17.1% in the fourth quarter of 2024, based on Friday's LSEG data. While a handful of companies have already reported on the quarter, the unofficial start of the first-quarter season is still weeks away.
Siemens Adds AI-Powered Maintenance To Industrial Copilot
Siemens’ new AI-powered solution enhances maintenance by enabling a data-driven approach across all stages. To realize this, the Senseye Predictive Maintenance solution powered by Microsoft Azure will be extended with two new offerings: An Entry Package: This solution provides an accessible and cost-effective introduction to predictive maintenance, combining AI-powered repair guidance with basic predictive capabilities. And a Scale Package: Designed for enterprises looking to fully transform their maintenance strategy, this package integrates Senseye Predictive Maintenance with the full Maintenance Copilot functionality.
The new offering enables comprehensive coverage of the entire maintenance cycle – from reactive repair to predictive and preventive strategies – by leveraging generative AI-driven insights that enhance decision-making and efficiency across industrial environments. Industries are shifting from reactive to proactive maintenance to improve reliability and reduce costs. By combining generative AI with predictive maintenance, companies can use real-time data and analytics for timely interventions and planning. Initial pilot tests indicate that Siemens’ Industrial Copilot for maintenance reduces reactive maintenance time by an average of 25%.
Read more at Engineering Magazine
Perdue Farms Seeks To Dismiss PFAS Lawsuit Again
Perdue Farms is fighting to toss out a class-action lawsuit alleging that one of its plants in Salisbury, Maryland, contaminated nearby groundwater with PFAS. The agribusiness recently sought again to dismiss or stay the case in the U.S. District Court of Maryland after an earlier attempt in December, citing an investigation by the state to better understand what caused the contamination and where the hot spots are.
Perdue this month submitted a plan to address eight suspected sources of PFAS contamination at its facility that were identified in a commissioned report reviewed by the Maryland Department of Environment. Perdue is also working with Langan Engineering and Environmental Services on creating a soil and groundwater sampling plan to address PFAS hot spots at the facility. The company submitted its plan to the state on March 7.
Read More at Manufacturing Dive
Musk Is Back In The Building — The Tesla One
Can a moonshot company escape its leader’s political baggage? What if the company’s success is in part bound up in that polarizing activity? Elon Musk is back in reassurance mode, professing his overarching vision and long-term goals for his car company that have little to do with car sales. Tesla stock (TSLA) is up 25% over the past week, with the biggest boost coming after an all-hands meeting at the company that conveyed the sense that Musk is "back in the building," with the CEO issuing a sermon to reassure his shareholding faithful.
Fast-tracking a private transportation transformation is at the heart of Musk's plans for Tesla. But dreams of a fleet of millions of robotaxis and thousands of humanoid robots are becoming much harder to sell when Musk is busy slashing through Washington instead of shepherding a volatile brand. But hints of a comeback are already gathering. The company's most outspoken backers see Musk placing his DOGE duties in better balance with his corporate responsibilities. And a resurgence of retail investor interest piercing through the doldrums highlights a defining trait of the ticker: convincing people that big things are coming.
Prototype To Production: Bosch Brings Metal 3D Printing To The Auto Industry
In a bold move that cements its status as an industry pioneer, Bosch has introduced a state-of-the-art metal 3D printing facility at its Nuremberg plant, becoming the first Tier-1 automotive supplier in Europe to operate a 3D printing centre of this scale. With an investment of nearly €6 million, Bosch is setting new standards in automotive production and industrial manufacturing. The new facility is equipped with the Nikon SLM Solutions NXG XII 600 metal 3D printer, one of the most advanced high-performance additive manufacturing systems in the world. This cutting-edge technology is designed to accelerate development cycles by drastically reducing the time required to manufacture complex metal components—critical in industries where precision and efficiency are paramount.
The capabilities of Bosch’s 3D printing facility are game-changing:
Up to five times faster than traditional 3D printing systems.
Eliminates the need for complex tooling and moulds, reducing lead times.
Minimises material waste, making the process highly sustainable.
Allows for the production of previously impossible geometries, including interior curved channels and drilled corners.