If Trump tariffs linger, Va. maritime industry will feel pain, experts say

With President Donald Trump‘s self-branded “Liberation Day” anticipated to bring a rollout of new tariffs April 2 that Trump says will free the United States of dependence on foreign-made goods, many businesses and citizens are wondering what will happen next, with skyrocketing consumer prices and supply costs among their worries.

On Monday, the president said he had settled on a plan for his latest group of tariffs but did not offer specifics. As of April 1, Trump has imposed 25% levies on imported steel and aluminum, and increased tariffs on Chinese-made goods by 10%. He placed 25% tariffs on goods from Mexico and Canada but quickly suspended those actions, and on March 26, Trump said he would impose 25% tariffs on imported automobiles and parts, set to go into effect April 3.

In Virginia, concerns about tariffs extend to the state’s significant maritime industry. According to the Port of Virginia’s 2024 annual financial report, port-related business directly and indirectly contributes to Virginia’s economy with more than 565,000 jobs, $124.1 billion in total spending and $5.8 billion in state and local tax revenues.

Virginia Commonwealth University‘s Brett Massimino, associate professor of supply chain and analytics in VCU’s business school, and Suffolk-based Mills Marine & Ship Repair President and General Manager Donald Mills recently shared their thoughts on Trump’s trade war and the potential impact of U.S. and retaliatory tariffs on Virginia’s maritime, logistics and supply chain industries.

For more from Massimino, Mills and other Virginia maritime leaders, look for Virginia Business’ annual Virginia Maritime Guide coming out in May.

Virginia Business: There’s been a lot of talk about tariffs since January, but it’s not clear what their impact could be. Do you expect tariffs from the Trump administration, as well as retaliatory tariffs from other countries, to affect Virginia’s supply chain and logistics businesses?

Brett Massimino: If the tariffs and retaliatory measures in place as of this writing remain permanent (which is a big if), then yes, I believe Virginia’s supply chain and logistics businesses will experience significant impacts. Importing costs would likely increase, and the complexity of cost accounting and tracking would also rise, leading to higher indirect costs for imports.

However, the losses in the maritime industry due to reduced imports and exports could be partially offset by growth in domestic transportation modes, such as rail and trucking, as demand for these services increases. Overall, however, I would expect an increase in costs throughout the supply chain as a result of the tariffs, regardless of whether production is ultimately relocated.

VB: Would long-term tariffs impact jobs in the maritime industry?

Massimino: Recent tariffs could also affect the maritime logistics industry by reducing import activity. If the tariffs successfully shift manufacturing to the U.S., demand for imports may decline, leading to fewer jobs for port workers, shipping route planners and sailors. Although the long-term effects of tariffs remain uncertain, they could significantly impact the maritime job market.

VB: How would tariffs affect your company if they are long-term?

Donald Mills: Long-term tariffs and retaliatory tariffs present substantial risks to Mills Marine & Ship Repair by significantly impacting material costs, supply chain reliability, and overall competitiveness. Our operations depend heavily on imported steel, aluminum, and specialty marine components, making us particularly vulnerable to tariff-driven price increases. Sustained tariffs would force us to absorb increased material expenses, compromising profitability, or alternatively, pass these costs onto customers, potentially reducing our market competitiveness.

To mitigate these potential impacts, we actively pursue diversified sourcing strategies, domestic supply chain enhancements and increased operational efficiencies. Advocacy for trade policies favorable to small businesses remains essential. Ultimately, prolonged tariffs necessitate strategic adaptability, underscoring our commitment to innovative operational management and proactive engagement with policymakers to safeguard our business and broader maritime economic contributions.