Monthly Roundup - Tariff Shifts, Qatar Airways’ E-Com Boost and PepsiCo’s Automation

The US-EU automotive trade is crucial for the European automotive industry, with the US being the largest export market for EU-made cars. In 2023, European manufacturers exported €56 billion worth of vehicles and components to the US, representing 20% of the EU's total automotive export value. However, this sector is vulnerable to potential tariff increases, particularly if a second Trump administration imposes a 25% tariff on EU automotive imports, up from the current 2.5%. Such an increase would make European cars less competitive in the US market, resulting in a sharp decline in EU automotive exports.

Germany and Italy, which are more dependent on the US market, would be hit hardest by this tariff. Exports to the US account for 24% of Germany's and 30% of Italy's extra-EU automotive exports, potentially leading to export declines of 7.1% and 6.6%, respectively. Shifting exports to other regions would be difficult due to differences in market demand and increasing competition from countries like China and South Korea.

The broader EU automotive sector would suffer significantly, particularly in Germany and Italy, where production could decline. While the US automotive industry is less reliant on European markets, the EU is more exposed to tariff risks, highlighting the EU’s vulnerability in this trade relationship. The sector supports 13.8 million jobs, including 11.2 million in indirect roles, and its decline would have ripple effects across supply chains and consumer spending, underscoring the industry's importance to the broader EU economy.

Given the substantial tariff changes, companies must act strategically rather than simply absorbing costs or passing them on to consumers. Gartner advises proactive scenario planning to address long-term tariff volatility. Companies that adapt flexibly can secure competitive advantages.

Gartner outlines five key strategic responses:

1. Retire: Discontinue products that become unprofitable due to tariffs.
2. Renovate: Redesign products or reassess cost structures to remain competitive.
3. Rebalance: Adjust strategies continuously in response to changing trade policies and political decisions.
4. Reinvent: Invest in new markets or technologies to reduce reliance on tariff-affected regions.
5. Reinvigorate: Expand production within the EU or in strategically favorable regions to enhance resilience.

For German companies, this means leveraging opportunities within the EU, diversifying supply chains, and strengthening long-term partnerships. Those that use tariff changes as an impetus for innovation can secure lasting competitive advantages.

Shoppers’ demand for fast delivery is expected to drive air freight growth of 5–10% in 2025, despite economic challenges, according to Qatar Airways Cargo. E-commerce saw a 25% growth last year and is projected to continue expanding at double-digit rates. Key growth areas include semiconductors, consumer products, and trade in China and India, supported by partnerships like the one with Alibaba's Cainiao. The carrier plans to expand its fleet with additional cargo jets this year and further Boeing 777-8F freighters starting in 2028. While potential risks like higher U.S. tariffs and geopolitical uncertainties pose challenges, Qatar Airways remains optimistic due to the sustained demand for rapid online shopping deliveries. Currently, the airline is the world’s largest air cargo carrier among passenger airlines, second overall only to FedEx.

PepsiCo has launched its first automated warehouse in Poland, in partnership with Mecalux, marking its most sustainable warehouse in Europe. Spanning 57,000 sq.m and accommodating 9,000 pallets, the facility uses advanced automation to improve logistics efficiency, reduce errors, and lower operating costs. It moves up to 3,500 pallets daily via electric tracks and pallet conveyors. The warehouse integrates PepsiCo's SAP ERP system with the Easy WMS warehouse management system, ensuring seamless goods flow and synchronized machine operations. Sustainability features include water reuse systems, rainwater treatment, and renewable energy from a photovoltaic system. The facility operates using a "push" production method, producing goods in advance based on expected demand, reducing costs while managing larger production volumes. PepsiCo plans to replicate the success of this project at its facility in Veurne, Belgium.

Unilever's ice cream supply chain spans 60 countries with 35 factories and approximately 3 million freezers. AI-driven weather analysis enhances sales forecasts, reducing waste and improving efficiency. AI-enabled freezers (100,000 so far) have boosted retail sales by up to 30%. By integrating AI, Unilever improves production planning, inventory management, and logistics. In Sweden, forecast accuracy has increased by 10%, while live AI systems in factories optimize production, cutting waste and reducing raw material usage by 10%. Real-time inventory updates from AI-enabled freezers further enhance forecasting, with significant sales growth in markets like Turkey (+8%), the US (+12%), and Denmark (+30%).

Read more on recent highlights

• Logistics real estate: Most dynamic top logistics regions in Germany 2024
• How quantum computing will transform logistics
• Tide detergent maker P&G eyes new price hikes to offset looming tariffs
• How a potential global tariff war could hit Europe's supply chains
• E-commerce: Online retail in Germany is on the rise again
• Amazon orders 200 new electric heavy trucks from Daimler for Germany, UK
• H&M speeds up shift to regional supply chains amid tariff threat
• European banks face test of resilience to major trade shocks
• Malaysia aiming to become energy, chip making hub, PM says
• China’s export boom shows how its trade is shifting not slowing
• Natural disasters led to damage amounting to $320 billion in 2024

Dive deep into research

"Nonlinear forecasting with many predictors using mixed data sampling kernel ridge regression models" by Dai, D., Javed, F., Karlsson, P., and Mansson, K. (2025)

"Inventory optimisation in a two-echelon cold chain: Sustainable lot-sizing and shipment decisions under carbon cap emissions regulations" by Sebatjane, M. (2025)

"An integrated framework for modeling pharmaceutical supply chains with disruptions and risk mitigation" by Goswami, A., Baveja, A., Ding, X. et al. (2024)

Events

CCE International

When: 11. - 13. March 2025

Where: Munich, Germany

What: International Exhibition for the Corrugated and Folding Carton Industry showcases machinery, raw materials, and services for the production and conversion of corrugated board and folding cartons. Attendees can explore innovations in packaging technology, including solutions for e-commerce, food and beverage, pharmaceuticals, and more.

ICE Europe 2025

When: 11. - 13. March 2025

Where: Munich, Germany

What: International Converting Exhibition focuses on the conversion of flexible, web-based materials such as paper, film, foil, and nonwovens, bringing together industry professionals to explore the latest machinery, technologies, and systems. Attendees can expect to see live demonstrations and exhibits from leading manufacturers and suppliers worldwide, offering insights into innovative solutions for the converting industry. The exhibition will feature interactive pavilions, live demos, themed zones, and workshops, providing a comprehensive platform for networking and knowledge exchange.

embedded world 2025

When: 11. - 13. March 2025

Where: Nuremberg, Germany

What: embedded world 2025 brings together experts and industry leaders to explore the latest advancements in embedded systems, covering hardware, software, services, and tools. Attendees can participate in the Embedded World Conference and the Electronic Displays Conference, featuring top-class speakers from research, development, and practice. In addition to the exhibition, the event offers a comprehensive supporting program with guided tours, special presentations, and networking opportunities, such as the #women4ew event, which provides a platform for women in the embedded systems industry.

LogiMAT

When: 11. - 13. March 2025

Where: Stuttgart, Germany

What: LogiMAT, the International Trade Show for Intralogistics Solutions and Process Management, showcases innovative technologies and solutions for optimizing internal logistics processes, including materials handling, warehouse management, and distribution. Attendees can explore a comprehensive range of products and services aimed at enhancing efficiency and reducing costs in intralogistics operations. The exhibition will feature live demonstrations, expert forums, and networking opportunities, providing a platform for professionals to exchange knowledge and discuss the latest trends in the industry.

INTEC

When: 11. - 14. March 2025

Where: Leipzig, Germany

What: The Intec International Trade Fair for Machine Tools, Manufacturing and Automation is a major European get-together for the metal processing industry that takes place every other year. Technology leaders, innovation drivers, manufacturers, distribution and service partners as well as service providers and specialists will be presenting innovative and precision technology designed to meet the day-to-day challenges of manufacturing. Intec is an essential industry get-together that offers both decision-makers and professionals a high level of competency, innovation, inspiration and a networking platform.

TECH SHOW LONDON

When: 12. - 13. March 2025

Where: London, UK

What: Tech Show London is a premier technology event featuring five co-located exhibitions:

• Cloud & AI Infrastructure: Focuses on cloud computing and artificial intelligence technologies.
• DevOps Live: Dedicated to DevOps practices and tools.
• Cloud & Cyber Security Expo: Concentrates on cloud security and cybersecurity solutions.
• Big Data & AI World: Explores big data analytics and AI applications.
• Data Centre World: Covers data center technologies and innovations.
  

M + R

When: 26. - 27. March 2025

Where: Antwerp, Belgium

What: M+R is the Belgian trade fair for process automation. Process automation monitors and controls industrial processes in sectors such as refineries, chemicals, paper production, and utilities (e.g. energy and water treatment plants). It revolves around continuous data measurement, analysis and automatic adjustment of parameters such as temperature, pressure and flow, with the aim of efficient, safe and accurate production processes. M+R focuses specifically on electrical and instrumentation engineers in the process industry and showcases the latest innovations in industrial measurement and control technology, software and automation.