According to KYU’s annual Supply Chain Risk Barometer, companies no longer have a choice: geopolitical risk, raw material shortages, and cyber risk must now be fully embedded into 2026 supply chain strategies.
In a hurry ? Here are the key notes to know:
- Geopolitics is the meta-risk shaping supply chains: Conflicts, trade disputes, and strategic rivalries create systemic vulnerabilities that influence all other supply chain risks.
- Raw material and component shortages are becoming structural: Dependence on rare earths, semiconductors, and critical metals makes shortages cyclical and persistent rather than temporary.
- Cyber threats are now systemic supply chain risks: Digitization and AI adoption increase exposure, especially for SMEs embedded in strategic supply chains.
- Strategic reconfiguration is essential: Companies must implement dual sourcing, control towers, and updated business continuity plans to build resilience and maintain competitiveness in a fragmented global economy.
Optimized supply chain models inherited from globalization are showing their limits. In response, companies are turning to dual sourcing strategies, control towers, advanced technologies, multi-tier visibility, and stronger integration between Supply Chain, Procurement, and Risk Management.
Although complex and demanding, this transformation represents a strategic opportunity for organizations able to rapidly adapt their value chains to this new reality.
A Permanent State of Disruption: 2025 as a Turning Point
Each year, consulting firm KYU publishes its barometer assessing risks impacting supply chains. The 2025 edition is based on interviews with 140 supply chain leaders, procurement directors, and risk managers from major French and European companies across all industrial sectors.
There is broad consensus: 2025 has been a year of continuous tension. Unilateral trade interventions, tariff negotiations, new trade agreements, armed conflicts (Ukraine, Middle East, Latin America, South East Asia), and the rise of sovereign industrial strategies have reshaped the global landscape.
The result is a clear shift toward a fragmented global economy, structured around competing blocs with divergent—and sometimes opposing—interests.
As Thierry Moulin, Partner at KYU, explained during a press conference last week:
“We have entered a durably fragmented and unstable world, now structured around blocks. Global supply chains that were optimized primarily for cost have proven largely unsuited to this new environment.”
No industry is spared: aerospace, automotive, chemicals, agri-food, energy, and logistics all face structural vulnerabilities.
Mapping the Risks: The Three Major Threats to Supply Chains in 2026
Let’s take a closer look at the three major risks threatening industrial supply chains in 2026.
1. Geopolitics: The Meta-Risk
For 55% of respondents, geopolitics is THE single greatest risk facing supply chains in the years ahead. Open conflicts and hybrid warfare have turned critical trade corridors into systemic points of failure.
According to Thierry Moulin:
“Geopolitics clearly acts as a meta-risk. It structures all other risks. We have moved from episodic tensions to lasting instability, bloc logic, and the militarization of trade relations.”
Taiwan and Semiconductor Dependence
One major fault line is Taiwan, the strategic heart of the semiconductor industry. The island still accounts for 60% of global semiconductor production and over 90% of the most advanced chips, essential for automotive, aerospace, defense, and digital industries.
A forced reunification scenario could trigger a maritime blockade in the South China Sea, through which nearly one-third of global trade passes—raising fears of a severe global supply shock driven by US-China rivalry.
Logistics Under Strain
Logistics, by nature at the center of supply chains, is also under great economic pressure:
“Maritime routes are durably disrupted. Today, China–Europe shipments must often go via the Cape of Good Hope because the Suez Canal is heavily impacted by Houthi attacks,” explains Moulin.
As a result, 40% of European imports from Asia are now rerouted around Africa—raising costs and CO₂ emissions. Freight rates have also become highly volatile, with container prices from Shanghai to Genoa peaking above $4,000 in June before falling back to around $2,000 by the end of 2025.
Combined with chronic labor shortages—especially among truck drivers—European logistics companies remain financially fragile. In France alone, 1,775 logistics company failures were recorded, with a similar situation in Germany.
Energy and Strategic Chokepoints
In the Red Sea and the Strait of Hormuz, geopolitical tensions—particularly involving Iran—are a major concern. Around 30% of global oil flows transit through the strait, including 40% of China’s oil imports and a significant share of Europe’s LNG. Any escalation involving Iran, Saudi Arabia, or the UAE would immediately inflate European energy and logistics costs.
Meanwhile, the ongoing Russia–Ukraine conflict continues to weaken Europe’s economic stability and raise fundamental questions around security and sovereignty.
2. Raw Material and Critical Component Shortages
This risk is a direct consequence of geopolitical tensions. The energy transition and digitalization have intensified demand for critical materials such as rare earths, semiconductors, copper (essential for electrification), and titanium (for aerospace).
China’s dominance remains overwhelming, reaching up to 90% dependence for certain minerals. The concentration of resources—such as rare earths in Greenland, now a strategic focal point—further amplifies vulnerability.
Although the European RESourcEU plan aims to reduce dependencies by 30–50% by 2029, supply risks remain high, exacerbated by US-China tensions.
“Unlike past shortages driven by temporary events, we are entering a world of cyclical and structural shortages,” warns Moulin.
The consequences of supply chain vulnerabilities are tangible, as illustrated by Nexperia, a key semiconductor supplier, which supplies around 40% of the diodes and transistors used by Europe’s automotive industry.
In November 2025, geopolitical tensions between the Netherlands and China triggered a disruption in Nexperia’s operations. The resulting shortage of semiconductors forced Bosch, one of Europe’s largest automotive suppliers, to partially suspend production at three of its European plants.
This case underscores a broader trend: in a world of highly concentrated critical inputs, geopolitical disputes, regulatory pressures, or export restrictions at a single node can quickly escalate into widespread production and operational crises for industries dependent on just-in-time supply models.
3. Cyber Risk: A Systemic Supply Chain Threat
Cyber risk ranks third among respondents but is rapidly becoming systemic, particularly with the rise of AI, Mr. Moulin notes:
“Attacks are faster, more targeted, and harder to detect. At the same time, companies are digitizing their value chains and deploying AI and robotics—making them even more exposed.”
The September cyberattack on Jaguar Land Rover is a stark reminder: over one month of production stoppage, 120,000 jobs at risk across the UK supply chain, and £1.5 billion in government support to secure supplier liquidity.
Attackers increasingly target SMEs, often less mature in cybersecurity but strategically embedded in supply chains. In Europe, over 40% of reported cyber incidents in 2025 involved tier-2 or tier-3 suppliers. The average cost of a major incident for an industrial SME ranges from €50,000 to €100,000, with recovery times exceeding six months.
“Cyber risk is a full-fledged supply chain risk—not just an IT issue.”
From Optimization to Reconfiguration: A Strategic Shift
Facing this interdependent shock system, KYU argues that incremental optimization is no longer sufficient. Companies must embrace a strategic reconfiguration of their value chains.
“This is no longer a cyclical issue but a structural one. We are moving from defensive, reactive resilience to strategic resilience.”
Here are the key levers for transformation.
1. Dual Sourcing
For 78% of companies, deploying dual sourcing in 2026 is a top priority: two suppliers, two regions, two sourcing zones.
“The objective is clear: agility. Each bloc must be served by a local supply base to avoid customs, regulatory, and logistical constraints.”
Some companies have already begun implementing this approach, particularly in the automotive sector. Significant investments have been announced, notably by Volkswagen in China and Stellantis in the United States, aimed at achieving a major reconfiguration of their supply chains.
For Thierry Blein, Supply Chain Risk Director at Renault,
“This is a major policy shift for the automotive industry.”
2. Control Towers and Predictive Capabilities
The most resilient companies are those capable of detecting early signals, analyzing crises, and reacting faster than competitors.
Automotive and aerospace are currently the most advanced sectors. Following the semiconductor crisis, automotive players for example, have strengthened control towers and supply mapping.
Renault’s Thierry Blein explains:
“Our control tower maps all suppliers, including lower tiers, and cross-references real-time climatic, geopolitical, and media data. We track over 5,000 transport flows via GPS, updated every ten minutes, and can assess business impact worldwide within 48 hours.”
Thales follows a similar approach, explains Roque Carmona, Group CPO:
“We combine field intelligence with internal alert and simulation tools. We are developing a digital twin of the supply chain to model crisis scenarios, assess impacts, and identify critical suppliers.”
3. Business Continuity Planning
Business continuity plans must now integrate geopolitical, climate, and cyber scenarios.
“Companies are also pushing their suppliers to mature in risk management and continuity planning,” explains Thibaud Moulin.
Security stocks, once designed for logistical hiccups, must be recalibrated to absorb far larger shocks. Ultra-lean manufacturing models are no longer sufficient.
Thierry Blein from Renault concludes:
“We are refining safety stock policies based on real supplier vulnerability and strengthening support on cyber and continuity topics. Resilience is not decreed—it is built with the entire ecosystem.”
Looking Ahead to 2026 and Beyond
By 2026, companies have no alternative but to implement new governance models, risk-aware strategies, and structural reconfigurations to remain both resilient and competitive.
Time horizons vary: 2–3 years for most sectors, 5–10 years for heavy industries. But the direction is clear: geopolitics is no longer a background factor. It is the organizing principle of global supply chains.
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