Tariffs, sanctions and anti-dumping measures: Overcoming barriers in cross-border trade
Tariff and non-tariff barriers present a considerable challenge to automotive supply chains in 2026, but well-structured customs teams, quality master data, centralised labelling and effective deployment of AI technology can help mitigate the impact of these disruptions on supply chain operations.
At Automotive Logistics and Supply Chain Europe 2026, delegates heard from three industry experts how best to overcome significant barriers in customs and cross-border trade. The panel – comprising of Agnieszka Kubiak, senior vice president of logistics at Brose Group; Nicolas Collart, chief compliance and trade officer at Customs Support Group; and Fearghal Kearney, senior sales director for EMEA at Loftware – began by outlining some of the top pain points they have been experiencing on a daily basis.
Kearney noted that production stoppages, mislabelling and incorrect classification are all sources of value leakage and therefore are major issues the industry needs to address. He shared his view that cross-functional collaboration and shared ownership is vital if an organisation is to overcome these challenges.
"Ownership used to sit in one pigeonhole in an organisation, but the governance for this needs to be borne across the organisation – from COO to supply chain, procurement and finance chiefs," he said. "Everybody needs to be involved in this because it's hitting revenue, it's hitting the cost of goods and it's hitting free cash flow."
Bringing data and systems up to speed for modern requirements
As Kearney identified, "automotive OEMs and large tier ones by nature don't change systems fast," so solving issues surrounding legacy systems isn't always easy, but can be crucial when looking to reduce errors and respond quickly to tariff changes, for example.
"There's more flexibility needed," Kearney explained. "There is a fear factor to changing anything to do with systems in automotive because a lot of it is legacy."
But Collart noted that it's not just systems that might be out-of-date for today's purposes, but master data too. With rapid changes to tariffs highlighting how customs can change overnight, the correct product identification can be essential. "What's happening is a lot of goods and product are getting stopped at borders because their identification is not up to date," Collart shared.
Essentially, quality master data on classification and origin is the foundation of a strong customs and trade function.
Whether data or systems is the cause of an issue, centralised labelling and identification can be an effective solution. An effective centralisation strategy can address issues arising from disparate systems – often the result of mergers, acquisitions and new plants.
Centralised management can allow for rapid deployment of data changes, pushing updated data from a central compliance office to plants, distribution centres and assembly points. This can reduce the need for stock to be held or sent back upstream following regulatory or tariff-related changes.
Automation and AI in customs
AI is ubiquitous in automotive logistics today, and within customs it is already being used to power some transactional processes. Collart explained that using AI technology in this way can not only improve efficiency, but also support compliance – freeing customs brokers from time spent on manual tasks while reducing the risk of human error.
Collart also alluded to applications of AI within classification. "But the big if there is control," he said. "Don't believe that it's going to be the full solution today because there is no such thing right now."
He also warned of the issue of liability if a company uses AI for its classification. "You are responsible to check and to define the right classification," he asserted. "In a sense, you can use AI as a tool, but you're responsible to define whether your outcome is right or wrong."
Agreeing with this sentiment, Kubiak stated: "There is no black-and-white solution. AI can support, but you still need an expert... By law, we are responsible, not AI."
However, she did note that AI can be very useful from a data perspective, to ensure all the master data has been collected and to run simulations quickly.
Structuring customs and trade teams for the future
The topic of customs and trade has undoubtedly been brought to the front of mind for those involved in the automotive supply chain since Donald Trump's return to the Oval Office saw a flurry of new tariffs from the US – and the counter-tariffs that ensued – but, as Collart pointed out, this is not the only reason more people are starting to recognise the importance of customs compliance.
"The cost of non-compliance is going up massively," Collart stated. "Authorities are becoming much stricter and they really are putting a lot of pressure on companies."
Recent examples, such as the $1.4 billion tax dispute between Indian customs authorities and Volkwagen Group in 2024 – in which the Office of the Commissioner of Customs in Maharashtra alleged the OEM misdeclared and misclassified CKD units as individual parts, according to a notice seen by Reuters – show just how costly non-compliance can be. In this case, a senior advocate representing Volkswagen's unit in India described the case as "a matter of life and death" for the Indian unit back in February 2025.
Of course, avoiding the consequences of non-compliance isn't the only way customs and trade expertise can save a business money, with Collart noting that more people are beginning to understand that optimising customs and trade procedures can actually be incredibly beneficial to the financial side of an organisation.
And with the spotlight shining more on customs and trade, the need for customs teams to be closer to all departments – be that purchasing, finance or legal teams – has become clear. In today's world, firms can not longer afford to view customs as a back-office function; these experts need to be have a strategic role and align closely with the rest of the business.
But when customs expertise is in high demand, training and talent development becomes paramount. One skill in particular that Kubiak identified as critical is the ability to translate complex dependencies into simple language and decision matrices for C-suite decision-makers. Without these skills, she noted, understanding between different roles and functions can break down and it can become difficult to proceed.
The role of customs and trade within the structure of an organisation has a key part to play in this. Kubiak shared that creating a direct connection between senior customs experts and the heads of other departments is essential and allows for decisions to be informed by customs-focused research on complex matters such as rules of origin and Free Trade Agreements.
The insightful discussion highlighted the need to treat customs and trade as a strategic, cross-functional priority, centralising governance and combining automation with human expertise to prevent value leakage and improve overall supply chain efficiency.
