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GAIN CONSULTING

April 2025 Logistics Manager’s Index: Navigating Rising Costs and Tariff Impacts

  • Kelsea Ansfield
  • May 5
  • 6 min read


At Gain Consulting, we provide U.S. shippers with actionable insights to thrive in a dynamic supply chain landscape. The April 2025 Logistics Manager’s Index (LMI), released by researchers from Arizona State University, Colorado State University, Florida Atlantic University, Rutgers University, and the University of Nevada, Reno, in collaboration with the Council of Supply Chain Management Professionals (CSCMP), reports an LMI score of 58.8, up 1.6 points from March’s 57.1. This indicates that the logistics sector is expanding, driven by increasing inventory costs, warehousing prices, and transportation prices, though tempered by a slowdown in inventory level growth. The report highlights the impact of Trump administration tariffs, which have spurred a Q1 inventory rush but are now leading to stagnant stockpiles and higher costs. This blog post analyzes the LMI findings, their implications for U.S. shippers, and strategic recommendations to optimize operations in 2025.


April 2025 LMI Overview: Expansion Amid Tariff Pressures

The LMI score of 58.8 reflects continued logistics expansion, though at a slower pace than February’s three-year high of 62.1. Any score above 50.0 indicates growth, and April’s reading aligns with Q4 2024 levels but is shaped by new dynamics, particularly tariffs and inventory stagnation. The LMI tracks eight metrics: inventory levels, inventory costs, warehousing capacity, warehousing utilization, warehousing prices, transportation capacity, transportation utilization, and transportation prices. Key findings include:

  • Growth Increasing at an Increasing Rate:

    • Inventory Costs: Up +5.0 to 75.6, signaling significant cost pressures.

    • Warehousing Capacity: Up +3.1 to 55.4, indicating mild expansion.

    • Warehousing Utilization: Up to 59.8, reflecting higher demand for storage.

    • Warehousing Prices: Up +11.2 to 72.3, driven by stagnant inventories.

    • Transportation Capacity: Up +1.6 to 55.2, showing slight loosening.

    • Transportation Prices: Up +5.8 to 62.3, with downstream firms reporting robust expansion (71.2).

  • Growth Increasing at a Decreasing Rate:

    • Inventory Levels: Down -4.2 to 57.1, indicating slower buildup.

    • Transportation Utilization: Down -0.7 to 53.3, the lowest since November 2023.


The 18.5-point gap between inventory costs (75.6) and inventory levels (57.1) is unusual, suggesting that Q1’s tariff-driven inventory rush has led to static stockpiles, inflating storage costs. Downstream (retail-facing) respondents predict stronger expansion (67.9) than upstream (manufacturing/wholesale) respondents (57.7), reflecting robust consumer demand despite economic uncertainty.

Key Takeaway: The logistics sector is expanding, but tariff-driven inventory stagnation and rising costs are creating challenges. Shippers must adapt to higher storage and transportation expenses.


Tariff Impacts: A Q1 Rush and Q2 Slowdown

The Trump administration’s tariffs, implemented in April 2025, have significantly disrupted supply chains:

  • 10% baseline tariff on most imports.

  • 25% tariffs on Canadian and Mexican goods (partially paused for 90 days).

  • 145% tariffs on Chinese imports (125% base rate plus 20% import tax).

  • Elimination of the de minimis exemption for shipments under $800, ending duty-free entry for e-commerce goods.


These policies spurred a Q1 2025 import surge, with U.S. imports up 50.9%, including a 22.5% increase in equipment purchases (LMI Report, April 2025). This contributed to a 0.3% GDP decline in Q1, the largest trade deficit impact since 1947. However, imports slowed in April, with Chinese shipments dipping and the Chinese Manufacturing PMI contracting at 49.0, its lowest in 16 months. Reuters reports a 64% drop in U.S.-China imports in early April 2025, and the Port of Los Angeles projects a 35% year-over-year TEU decline for early May (LMI Report, April 2025).


The de minimis exemption removal has hit e-commerce hard, increasing costs and customs processing times for companies like Shein and Temu, which drove de minimis shipments from 400 million in 2018 to 1.36 billion in 2024. DHL and Temu have ceased de minimis shipments, potentially disrupting their U.S. operations (LMI Report, April 2025). Additionally, $50 per net ton fees on Chinese ships at U.S. ports, set to rise by $30 per ton over three years, will further elevate import costs.

Key Takeaway: Tariffs have shifted from fueling a Q1 import boom to causing a Q2 slowdown, with higher costs and reduced e-commerce volumes challenging shippers.


Broader Supply Chain Dynamics

The LMI findings align with broader trends shaping U.S. logistics:

  1. Inventory Stagnation: The Q1 rush left retailers like Walmart, Home Depot, and Ikea with excess inventory, particularly in toys, apparel, and home goods. LMI Report notes that these stockpiles mirror pre-holiday buildups but lack the seasonal sales boost, leading to high storage costs.

  2. Consumer Sentiment: U.S. consumer confidence dropped 8% from March to April 2025, down 32.4% year-over-year, the steepest three-month decline since 1990 (LMI Report, April 2025). Expectations of 6.5% inflation—the highest since 1981—reflect trade policy uncertainty. Yet, Mastercard reports 9% growth in U.S. spending in Q1, suggesting resilience (LMI Report, April 2025).

  3. E-Commerce Resilience: Digital Commerce 360 highlights Walmart’s 16% online sales growth in Q4 2025, with delivery expansion to 12 million households driving last-mile demand. Amazon’s $4 billion investment in 210 rural delivery stations reflects continued e-commerce strength (LMI Report, April 2025).

  4. Cross-Border Trade: BTS Transborder Freight Data shows $131.6 billion in U.S.-Canada-Mexico freight in February 2025, up 2.1%, with trucking ($86.6 billion, +3.9%) leading. Ports like Laredo, TX ($23.4 billion) and Detroit, MI ($8.1 billion) are critical (BTS, April 23, 2025).

  5. Freight Market Softness: American Trucking Associations projects 1.6% freight volume growth in 2025 (Transport Topics, April 24, 2025). FreightWaves notes stronger short-haul trucking demand compared to declining long-haul volumes, with flatbed tender rejection rates at 40% in March (LMI Report, April 2025).

  6. Job Market: The U.S. added 177,000 jobs in April, including 29,000 in transportation and warehousing, supporting logistics despite a tariff-driven slowdown (LMI Report, April 2025).

Key Takeaway: E-commerce and cross-border trade remain strong, but inventory stagnation, consumer uncertainty, and a soft freight market require strategic planning.


Implications for U.S. Shippers

The April 2025 LMI and tariff landscape present several implications:

  1. Rising Costs: Inventory costs (75.6) and warehousing prices (72.3) are surging, with downstream firms predicting 94.0 for future inventory costs, a potential record. LMI Report notes $50 per ton port fees on Chinese ships will further increase expenses.

  2. Capacity Dynamics: Warehousing capacity (55.4) is tight, with 7% vacancy rates in Q1 2025, up from 3% in 2022 (Prologis, April 2025). Transportation capacity (55.2) is loosening, but downstream firms report higher utilization (59.6) and prices (71.2).

  3. Inventory Challenges: Slowing inventory levels (57.1) and static stockpiles risk shortages in toys, apparel, and footwear by the back-to-school season, as warned by Walmart and Adidas (LMI Report, April 2025).

  4. E-Commerce Shifts: The de minimis exemption loss disrupts Shein and Temu, but Amazon and Walmart’s logistics expansions support last-mile demand (Digital Commerce 360, April 18, 2025).

  5. Trade Disruptions: A projected 15% drop in U.S. cargo volumes for 2025 (VT Markets, April 14, 2025) and 40% blank sailings on Trans-Pacific routes by August (LMI Report, April 2025) signal reduced import activity.

Key Takeaway: Shippers face escalating costs and inventory challenges but can leverage e-commerce growth and cross-border opportunities to stay competitive.


Strategic Recommendations for U.S. Shippers

To address the LMI findings and tariff impacts, U.S. shippers should adopt the following strategies:

  1. Optimize Inventory Management: Reduce static stockpiles by aligning inventory with demand forecasts. Use just-in-time strategies for high-turnover goods like pharmaceuticals (+17.3%, S&P Global, April 15, 2025) to minimize storage costs (75.6).

  2. Secure Bonded Warehouses: Defer duties for up to five years using customs bonded warehouses, especially for apparel and electronics. Bloomberg reports a sixfold demand increase (Bloomberg, April 15, 2025).

  3. Diversify Sourcing: Shift to Mexico, Vietnam, or India to avoid 145% Chinese tariffs. CNBC notes 57% of companies plan to relocate supply chains (CNBC, April 14, 2025). Leverage USMCA for duty-free trade with Mexico.

  4. Strengthen Last-Mile Partnerships: Partner with carriers like FedEx or USPS to offset potential UPS capacity constraints, as UPS cuts 20,000 jobs and closes 73 facilities (Reuters, April 29, 2025). Align with Amazon’s rural delivery expansion for e-commerce efficiency (LMI Report, April 2025).

  5. Leverage Cross-Border Trucking: Focus on hubs like Laredo, TX ($23.4 billion) and Detroit, MI ($8.1 billion) for cost-effective shipments. BTS data shows trucking’s 3.9% growth (BTS, April 23, 2025).

  6. Monitor Freight Rates: Use SONAR or Freightos to track transportation prices (62.3) and port congestion. DataDocks reports a 41% drop in April freight bookings (DataDocks, April 2025).

  7. Invest in Automation: Adopt robotics for warehousing, following Walmart’s Symbotic model, to manage warehousing prices (72.3) and tight capacity (55.4) (Digital Commerce 360, April 18, 2025).

  8. Prepare for Consumer Shifts: Anticipate price hikes and potential demand drops due to 6.5% inflation expectations. Focus on resilient sectors like healthcare to offset declines in toys and apparel (LMI Report, April 2025).

Key Takeaway: Strategic inventory management, diversified sourcing, and automation will help shippers mitigate rising costs and tariff disruptions.


The 58.8 LMI signals logistics expansion, but tariff-driven costs and inventory challenges demand agility.


Contact Gain Consulting today to build a resilient supply chain for 2025.



Sources: Logistics Manager’s Index Report, April 2025; Reuters, April 29, 2025; Bloomberg, April 15, 2025; FreightWaves, April 25, 2025; Digital Commerce 360, April 18, 2025; BTS Transborder Freight Data, April 23, 2025; VT Markets, April 14, 2025; CNBC, April 14, 2025; S&P Global Market Intelligence, April 15, 2025

 
 
 

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