North American Manufacturers Slash Orders as Supply Chains Lag

Manufacturers in North America decreased their orders for raw materials and intermediate goods in October 2025, according to the latest findings from the GEP Global Supply Chain Volatility Index. This index, which relies on a monthly survey of approximately 27,000 businesses worldwide, highlights a significant shift in purchasing behavior that may lead to reduced production in the coming months.

The decline in input demand was the sharpest observed since May, indicating a potential cooling of factory output in North America. The Volatility Index registered at -0.33 for October, reflecting an underutilization of global supply chain capacity. Many manufacturers have opted for leaner inventories, resulting in a reduction of new purchases. Earlier in the year, firms had engaged in stockpiling driven by tariffs, but this trend has now reversed.

With lower material purchasing reported across various sectors, the pressure on supply chains has eased, which are currently operating well below full capacity. This trend is not limited to North America; Asia has also seen a slowdown. A notable decline in factory buying in China has countered the strength observed in India, leading to a broader softening throughout the region.

In Europe, manufacturers reported only a marginal increase in activity. Key economies, including Germany, France, Italy, and the U.K., continue to limit raw material purchases, highlighting a sluggish recovery in industrial output across the continent.

Michael DuVall, Vice President of Consulting at GEP, remarked, “North America is seeing the clearest sign yet of a manufacturing pullback. Manufacturers are buying less and working down inventories, which points to weaker production through the winter.” He also indicated that with existing space capacity across global supply chains, no significant price pressures are anticipated for buyers, aside from those arising from tariffs.

The findings for October 2025 underline a pivotal moment for manufacturers in North America, revealing a trend that could shape economic conditions in the near future. The next release of the GEP Global Supply Chain Volatility Index is scheduled for 8 a.m. ET on December 10, 2025, providing further insights into the evolving landscape of global supply chains.

For more detailed information about the index and its methodology, interested parties can visit [GEP’s website](http://www.gep.com).