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Retailers Lean on Chinese Suppliers; Europe's Arms Makers Mobilize By Mark R. Long

Tense deliberations among retailers and suppliers show how President Trump's trade agenda is rippling through global supply chains.

The WSJ's Hannah Miao and Sarah Nassauer report that the biggest U.S. retailers are leaning on suppliers for discounts and seeking out alternative sources as they navigate the fast-escalating trade war. Much of the focus has been on China, which the administration hit with a 10% tariff in February and an additional 10% this month.

Walmart, Home Depot and others are telling their suppliers to make price concessions or shift production out of China, or risk losing business. Joe Jurken, founder of the ABC Group, which helps American businesses manage Asian supply chains, said he has received a flood of inquiries from manufacturers under pressure to move production out of China.

The requests have raised the ire of officials in Beijing , and some negotiations are hitting an impasse because so many manufacturers already are operating on razor-thin margins.

Planning around the tariffs is especially tough because companies can't be sure which threats of new duties will materialize and where others might emerge, retailers and suppliers say.

U.S. retail sales rose 0.2% in February , less than the 0.6% expected by economists. (WSJ) China reported surprisingly robust economic activity to start the year. (WSJ) Higher U.S. tariffs are set to slow economic growth and push inflation higher around the world, the Organization for Economic Cooperation and Development said. (WSJ) U.S. businesses warn that the trade war with Europe threatens an estimated $9.5 trillion in two-way trade and investment. (WSJ) CONTENT FROM: PENSKE Gain Intel. Gain Ground with Penske.

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Quotable Matériel Changes

Europe's ability to curb its reliance on U.S. military power depends on companies quickly revamping regional weapons supply chains that had been withering since the Cold War.

The Journal's Alistair MacDonald and Noemie Bisserbe write that firms such as France-based missile maker MBDA are racing to bolster their manufacturing bases . By year's end, MBDA will have doubled its output from 2023, and the company is investing $2.7 billion as it works through a $40 billion order book .

Obstacles to increasing output across the arms industry include finding enough skilled workers and fostering reliable supply chains .

MBDA now stockpiles 80 metric tons of specialist steel, up from five tons before the war in Ukraine. It has enough titanium for several thousand missiles. Parts such as nose cones and wings are made in Bourges, France, then shipped 40 miles north to an assembly plant. They then are stored in nearby bunkers before being shipped.

Trump said he would hold Iran responsible for attacks on Red Sea shipping by Yemen's Houthis. (WSJ) Number of the Day In Other News

Shares of Samsung Electronics, SK Hynix, TSMC and other Asian suppliers to Nvidia rose ahead of the U.S. chip giant's annual AI conference. (WSJ)

Goldman Sachs cut its oil-price forecasts for this year and next on expectations of slower demand growth. (WSJ)

Fast-fashion retailer Forever 21 filed its second bankruptcy in five years after a failed turnaround effort. (WSJ)

Guess said WHP Global offered to take the clothing company private for $13 a share in cash. (Dow Jones Newswires)

Audi said it will cut 7,500 jobs by 2029. (WSJ)

Nippon Steel and U.S. Steel got an extension for their lawsuit over their proposed merger. (WSJ)

U.K. manufacturing output fell in the first three months of the year for the first time since 2016. (Times of London)

Tiny plastic pellets found washed up on England's east coast likely came from last week's collision between an oil tanker and a cargo ship. $(BBC.AU)$

Container shipping is heading into another downcycle with an oversupply of capacity and weakening demand. (Journal of Commerce)

Chinese authorities raised pressure on CK Hutchison over its Panama ports deal in a second newspaper opinion piece. (Bloomberg)

ArcelorMittal Shipping is selling four of its smallest vessels for a total of about $60 million. (TradeWinds)

Honda will procure enough batteries for the hybrid vehicles it sells in the U.S. from Toyota's plant in North Carolina. (Nikkei Asia)

Macy's will open a 1.4 million square-foot distribution center in China Grove, N.C., in mid-2025. (Supply Chain Dive)

Houston rail-yard operator County Line Rail acquired Sabine River and Northern Railroad , a short line in East Texas. (Progressive Railroading)

WestJet Cargo signed an agreement to manage cargo sales on Virgin Atlantic's new flights from Toronto. (Air Cargo News) About Us

Mark R. Long is editor of WSJ Logistics Report. Reach him at [mark.long@wsj.com]. Follow the WSJ Logistics Report team on LinkedIn: Mark R. Long , Liz Young and Paul Berger .

This article is a text version of a Wall Street Journal newsletter published earlier today.

(END) Dow Jones Newswires

March 18, 2025 07:04 ET (11:04 GMT)

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