Trade wars, geopolitical unrest, and threats of tariffs. After the events of this spring, speculation is growing that the era of boundless globalization may finally be coming to an end. A new pre-study from Lighthouse has examined how shipping would be affected by increased regionalization and shorter supply chains.

The work on the pre-study Regionalised supply chains and the impact on shipping began back in 2023. At that time, the pandemic and a series of other disruptions had affected transport chains, and there was talk in many quarters about ongoing regionalization. However, the first interview studies conducted with Swedish companies did not confirm this.

“There was a desire, especially to reduce dependence on China, but at the same time, production there had become not only cheap but also of high quality. Bringing manufacturing back home was therefore far from simple. In Europe, there was often a lack of both capacity and expertise to mass-produce at the same scale. Moreover, many companies felt relieved that the pandemic was over and wanted to return to familiar routines,” says Johan Woxenius, Professor of Maritime Transport Economics and Logistics at the School of Business, Economics and Law at the University of Gothenburg, who led the report's work.

So, the pandemic and isolated disruptions (drought in the Panama Canal, Houthi rebels in the Red Sea, etc.) in container shipping were not enough on their own to drive regionalization of supply chains. However, by spring 2025, the situation is different. Geopolitical tensions, sanctions, and tariffs have instead become the decisive forces behind a restructuring of supply chains. Regionalization has now emerged as a key concept—not just in corporate boardrooms, but also in politics and the media. In new interview studies, companies report a much stronger desire to regionalize.

“The degree of regionalization varies among Swedish companies. Multinational companies, such as Volvo Cars, tend to be more flexible, with the ability to redistribute production and restructure supplier networks across different regions. Other companies, such as Tingstad, which depend on imported products from Asian manufacturers, have fewer alternatives, making them more vulnerable to disruptions, freight costs, and tariffs,” says Johan Woxenius.

Even though regionalization is an ongoing trend, according to the pre-study, there is nothing to suggest that it will entirely replace globalization. Global trade simply has too many advantages.

“Many are hoping the current situation will blow over. What we’re seeing in the latest interviews is a kind of paralysis—companies are hesitant to make decisions about new factories, suppliers, or markets as long as the future is so uncertain and nothing is settled regarding tariffs and other issues.”

“Right now, the volatility in the system is the main problem. If tariffs are set and it's assessed that they will remain even after Trump’s presidency, then companies will likely start making decisions based on that.”

A regionalization of production would naturally affect shipping. Less cargo would cross oceans as more production steps are gathered within the same region. According to the report, this would likely disadvantage container shipping but benefit intra-European RoRo and ferry traffic — with a potential shift from container ports in western Sweden to ports in southern and southeastern Sweden.

“There are no Swedish-owned container shipping companies, but our analysis focuses on shipping that serves Sweden. If freight flows become more European, competition with land transport may increase — and RoRo and RoPax traffic could play a more significant role as a subcontractor to road and rail transport. But even today, more goods are rolling into the Port of Gothenburg than are being lifted. We trade significantly more with our EU partners than with other countries. So maybe we shouldn't overstate the problem,” says Johan Woxenius.

The pre-study Regionalised supply chains and the impact on shipping was authored by: Johan Woxenius (University of Gothenburg), Marta Gonzalez-Aregall (University of Gothenburg), Martin Svanberg (RISE), Ceren Altuntas Vural (Chalmers), and Sara Rogerson (RISE).