Tariff Policy Effects_ How RWI Logistics and Interstate Utility Trailer Bring Resilience to Supply Chains - RWILogistic

1. Tariff Policy Effects: How RWI Logistics and Interstate Utility Trailer Bring Resilience to Supply Chains The Trump administration has imposed significant tariffs on U.S. trading partners. In late 2024, President Trump announced a 25% duty on most imports from Canada and Mexico—effective February 4, 2025, with Canadian energy at 10%—and a 10% tariff on Chinese goods, later raised to 20% on March 4, 2025. A 25% tariff on steel and aluminum imports globally followed on March 12, 2025. USMCA-compliant goods from Canada and Mexico have been indefinitely exempt since April 2, 2025. President Trump also signed an order on April 2, 2025, implementing a 25% tariff on auto imports from all countries, effective immediately, with tariffs on auto parts effective May 3, 2025; USMCA-compliant vehicles remain exempt. A 30-day pause on Canadian and Mexican tariffs delayed their start from February 4 to March 4, 2025, after which they took effect for non-exempt goods. On Tuesday, April 2, 2025, President Trump escalated his trade policy with “Liberation Day” tariffs, announcing a 10% baseline tariff on all U.S. imports, effective April 5, 2025, and higher duties on dozens of countries. While the European Union faces potential tariffs—threatened but not yet set—China’s rate surged to 145% on April 10, 2025. China’s tariff rate further escalated to 245% on April 15, 2025, intensifying trade tensions. On April 9, Trump paused higher tariffs (ranging from 11% to 50%) on 57 countries for 90 days, excluding China, dropping their rates to the 10% baseline to allow for negotiations. These measures aim to curb illegal immigration and drug trafficking—particularly fentanyl—while also boosting domestic manufacturing and, later, reducing trade deficits. Canada is retaliating with a 25% tariff on $20 billion of U.S. goods as of March 12, 2025 (Morning Brew), following earlier 25% tariffs on $155 billion in U.S. goods on

2. March 4, and a 25% levy on non-USMCA U.S. vehicles on April 9, amplifying trade tensions. Many countries have threatened further retaliatory tariffs, raising fears of an oncoming trade war. These new tariffs are already impacting supply chains, with many industries feeling the effects. In exploring this topic more in depth, RWI Logistics, a leading logistics solution provider, interviewed their affiliate company, Interstate Utility Trailer, on the impact to the new and used trailer market. Key Player: Interstate Utility Trailer Interstate Utility Trailer, established in 1975, is one of the largest semi-trailer dealerships in North America. The dealership has 4 physical locations in the Midwest, Cincinnati, Columbus, Indianapolis, and Louisville. They offer new and used trailers as well as a parts and service department at each location. Interstate also has over 30 mobile trucks for call-out repairs or dedicated maintenance. Interstate Utility Trailer, like RWI Logistics, is part of the Castellini Group of Companies. Jeff Barber, Interstate Utility Trailer’s retiring President has been with Interstate for 39 years. Prior to stepping into his role as President in 1998, Jeff served as Vice President as well. Now in 2025, Jeff Barber is beginning to transition out of his role to retire. Lance Hansen, Interstate Utility Trailer’s incoming President stepped into his role earlier this year. Prior to his time at Interstate, Hansen worked in the commercial vehicle industry for more than 25 years. RWI Logistics spoke with Interstate Utility Trailer executives, Jeff Barber and Lance Hansen, about the upcoming tariffs. Semi-Truck Sales: New vs Used When asked about the impact tariffs are having on semi-truck sales, Jeff Barber said, “Tariffs have created buying opportunities for used trailers. With inflation spiraling, trucking folks are looking to lower costs—people can’t stomach the inflation. Tariffs will only make it worse.” S&P Global agrees, estimating a 9% net increase in U.S. truck prices as a result of these new tariffs. With the cost of semi-trucks rising, demand is beginning to shift towards used trailers over new ones. Jeff Barber notes, “A new refrigerated trailer averages $95,000; a used one’s $40,000 to $50,000…Two years ago, we were selling trailers for $70,000.” Lance Hansen adds, “The used market’s where it’s at, if you spend $95,000 versus $40,000-$50,000, that’s a big deal for fleets—everyone’s looking to save money right now.” Interstate Utility Trailer’s ability to quickly pivot their focus to used trailers and repairs mirrors the desire of fleets and owner operators toward cost-saving solutions. Yet, price isn’t the only thing driving this shift in demand, “The trucking industry’s seeing bigger companies buy out smaller ones” says Jeff Barber, “Fleets are downsizing and selling out. In 2025, the owner-operator base are the main buyers of used trailers… Fleets aren’t buying and if they do, it’s small, aggressive orders.”

3. According to S&P Global, the share of commercial trucks imported from Canada and Mexico has more than doubled since the formation of the USMCA trade agreement and NAFTA before it. These imported trucks represented nearly one-third of new-vehicle demand in the United States. When asked about imported trucks and trailers from Canada and Mexico, Jeff said, “[There’s] no real benefit there. New trailers sold in the U.S. have a 12% federal excise tax; Canada doesn’t. If a Canadian trailer comes here, the buyer pays that 12%. Same with Mexico. It makes them unaffordable.” Shippers and Growers Manufacturers, food shippers, and growers reliant on imports from Canada and Mexico are bracing for supply chain disruptions as the new tariffs take hold—though exceptions soften the blow. The dairy and produce sectors face particular uncertainty where tariffs apply, such as on non-USMCA-compliant Canadian dairy or Mexican avocados, potentially driving up costs and straining availability. USMCA-compliant goods, covering many agricultural staples, remain exempt as of now, but industries dependent on cross-border trade still navigate logistical hurdles and rising expenses that could reach consumers. An article from The Grower highlights the challenge: “A quick and simple alternative to replace the volume of expertly-grown, Canadian produce doesn’t exist.” For items like fresh berries and greenhouse tomatoes not fully covered by USMCA exemptions, growers face obstacles—from building permits to skilled labor—that clash with the U.S. market’s pace, though tariff-free grains and potatoes offer some stability. Canadian farmers are posting bonds with customs brokers—some as high as $10 million, per The Grower—to cover potential tariff costs, a financial burden that could pass through to U.S. shippers. Mexico, the top supplier of U.S. avocados—nearly all of them—amps up the stakes. While USMCA-compliant avocados dodge the 25% tariff, non-compliant imports face it, risking price hikes. A 2024 USDA report projected up to a 30% cost increase in a full-tariff scenario, though exemptions currently limit that hit—unless Mexico’s retaliatory 25% tariffs on U.S. goods shift the balance. Mexico also supplied 70% of U.S. vegetable imports by value in 2024, per the Los Angeles Times, with tomatoes, peppers, and citrus leading. Non-exempt shipments could see price shocks, testing refrigerated freight’s efficiency. Rising equipment costs—driven by inflation and Chinese import tariffs—may push shippers to rely on older trailers, risking spoilage and higher operational costs. Seizing Opportunities with RWI Logistics and Interstate Utility Trailer RWI Logistics, a logistics solution provider, and Interstate Utility Trailer provide critical support as tariffs reshape the supply chain landscape. Since the tariffs were announced, David Noone, President of RWI Logistics, has observed a noticeable shift. “We’ve seen a tightening in capacity and port markets, as well as a surge in imports from companies rushing to beat the full tariff effect,” he noted. Ports like Laredo, Gulf Port, Savannah, and Los Angeles are feeling the strain, with capacity constraints driving uncertainty. “Our customers are trying to remain nimble, planning day-to-day instead of months or quarters ahead of time.”

4. This volatility hits carriers hard, too. David Noone pointed out, “Costs are rising, and carrier operating levels aren’t sustainable. We are seeing an increase in carriers going out of business or being acquired by larger companies.” Amid this uncertainty, RWI Logistics offers a steady hand. “We can’t change the tariffs,” David continued, “but we can work closely with customers, understand their needs, and deliver tailored solutions to help them meet business goals.” Whether it’s expanding into new markets, coordinating rideshare options, or tapping RWI’s deep experience in the refrigerated freight industry, RWI Logistics brings competitive, tailored services to the table. “We will see continued expectations from our customers to lead and support cost savings initiatives because tariffs will put pressure on cash flow and in some cases, they will not be able to pass along all of this cost to their end customer.” For produce shippers exempt from direct tariff hits, RWI ensures indirect disruptions don’t derail operations, leveraging freight management and business intelligence tools. These services provide real-time insights through analytics and visualizations, helping clients spot cost-saving opportunities and maintain efficiency even as ports clog and rates climb. With expertise in full truckload (FTL) and less-than-truckload (LTL) refrigerated shipments, RWI keeps perishable goods moving seamlessly—a lifeline when traditional routes falter. Interstate Utility Trailer complements this agility with equipment reliability. Over the last 39 years, Jeff Barber has grown their mobile repair service to over 30 trucks, aiming to keep fleets affordable and operational. “We focus on parts, service, timeliness, and quality—customers need trailers back on the road fast,” Barber explained. Lance Hansen added, “We’re proactive about acquiring used trailer packages—distressed units, lender repossessions—to meet the market’s needs.” This approach compliments RWI’s capabilities, as David highlighted, “Our connection with Interstate Utility Trailer gives us an edge. We can connect our carrier partners to Utility to facilitate rentals, leases, purchases, or short-term storage trailers—additionally, we can gain access to equipment to support customer drop trailer needs.” Together, RWI Logistics and Interstate Utility Trailer form a powerful duo—transportation providers that combine logistics flexibility with dependable equipment. In a volatile market, their combined resources help businesses not just weather challenges but turn them into opportunities. Conclusion The 2025 tariffs mark a pivotal moment for U.S. supply chains. Designed to curb illegal immigration, combat drug trafficking, and revive American manufacturing, these measures—coupled with retaliatory tariffs—threaten to deepen inflation and disrupt trade flows. From border delays and increasing truck prices to the strain on food supply chains, the impacts are already taking effect. However, RWI Logistics and Interstate Utility Trailer emerge as vital allies for fleets, shippers, and growers. RWI’s freight management services offer shippers the tools they need to navigate disruptions with precision, while Interstate’s pivot to used trailer sales and expanded mobile repairs keeps fleets moving affordably. As the tariffs intensify, their combined expertise provides a beacon of resilience, helping businesses seize opportunities in an evolving economic reality.

5. RWI Logistics is part of the Castellini Group of Companies, which also includes: Castellini, Interstate Utility Trailer, ITDS, Truckway Leasing, and Transport Specialists Inc. These companies are uniquely positioned to provide end-to-end supply chain services for transportation providersand shippers. Sources Interview with David Noone, RWI Logistics, conducted by Madelyn Schweitzer, April 8, 2025. Interview with Jeff Barber and Lance Hansen, Interstate Utility Trailer, conducted by Madelyn Schweitzer, March 20, 2025. S&P Global, “Tariffs Impact on Trucking Industry: What We Know So Far,” March 25, 2025, Tariffs Impact on Trucking Industry: What We Know So Far | S&P Global. FreightWaves, “Trucking lobby warns against Trump’s tariffs on Mexico and Canada,” March 4, 2025, www.freightwaves.com. Trucking Info, “How New Trump Tariffs Could Affect Trucking,” March 5, 2025, www.truckinginfo.com. ATA, “Trucking Industry’s Statement on New Tariffs,” March 3, 2025, www.trucking.org. UPS Supply Chain Solutions, “2025 US Tariffs and Their Impact on Global Trade,” March 12, 2025, www.ups.com. Morning Brew, “Tariff news today,” March 12, 2025, X post. Transport Topics, “Tariffs on Canada and Mexico have trucking companies rethinking nearshoring,” March 23, 2025, www.ttnews.com. Transport Topics, “Trump Hits Auto Imports With 25% Tariff in Trade Fight” March 26, 2025, Trump Hits Auto Imports With 25% Tariff in Trade Fight - TT Bloomberg, “Prologis CEO on Tariffs Impact on Logistics Real Estate,” Video. Watch Prologis CEO on Tariffs Impact on Logistics Real Estate - Bloomberg Reuters, “Trump tariffs endanger struggling US trucking industry,” December 13, 2024, www.reuters.com. The Grower, “Trump’s tariffs: high stakes for greenhouse vegetable growers,” March 24, 2025, Trump’s tariffs: high stakes for greenhouse vegetable growers | The Grower NPR, “What to know about avocados and tariffs,” December 23, 2024, What to know about avocados and tariffs : NPR The New York Times. (2025, April 2). Here’s the latest on tariffs. The New York Times. Retrieved from https://www.nytimes.com/live/2025/04/02/business/trump-tariffs- liberation-day#heres-the-latest-on-tariffs