Company bosses hit pause on growth plans after tariff shock
Top UK business leaders have sounded the alarm on geopolitical tensions, warning that trade uncertainties are threatening their growth prospects.
Nearly half of UK chief executives admitted to being “very or extremely concerned” about the impact of tariffs on their company’s operations and sales in the upcoming year.
Concerns have led to company chiefs slamming the brakes on major plans with 83 per cent delaying planned investment on account of trade developments.
A quarter have completely halted plans and half have delayed, according to EY-Parthenon’s latest CEO Outlook survey.
The US’ trade disputes with China and the UK ranked amongst the top geopolitical concerns for the 100 UK company bosses surveyed. Of those polled, 73 per cent were from publicly listed firms with 79 per cent netting over $1bn in annual revenue for the most recent fiscal year.
Global markets have remained bound to President Donald Trump’s every word since his ‘Liberation Day’ levies on the US’ trading partners.
The latest twist in the President’s trade offence included threatening the EU with a 50 per cent tariff as trade discussions derailed. The FTSE 100 shed one per cent as news broke on Friday.
But the President has since climbed down on the threat but investor and business anxieties remained heightened.
Firms to offload costs to consumer
To combat the tariff impact, nearly 40 per cent of company bosses said they had relocated operations to different geographies. One in four said they had ditched specific markets altogether.
Consumers are also set to feel the sting of business disruptions.
Almost one-third of respondents said they would pass on the cost increases to customers through increasing prices.
Over forty per cent planned to absorb costs internally through operational efficiencies and cost reductions.
Silvia Rindone, EY UK&I managing partner for EY-Parthenon, said: “Chief executives are navigating an extraordinary combination of structural, political, and economic headwinds that are reshaping the landscape for traditional forecasting.
“In this climate of heightened uncertainty, agility and innovation must underpin strategic decision-making.”