The 2026 Manufacturing Shifts You Can’t Ignore

Each year, we ask hundreds of manufacturing and supply chain leaders in MedTech, Robotics, EV, and Climate Tech where they’re investing, what’s slowing them down, and what’s changed.

Fictiv and MISUMI just released the 11th Annual State of Manufacturing & Supply Chain report. Here are just a few of the most compelling results:

• Most leaders are using AI in core manufacturing and supply chain workflows
• The vast majority believe AI will increase engineering productivity up to 5X
• Outside tariff expertise is a critical component of today’s supply chain strategy

The 2026 State of Manufacturing and Supply Chain report tells that story in detail.

The AI debate is over

AI adoption in manufacturing jumped from 87% to 93% in a single year. Ninety-five percent of manufacturing and supply chain leaders surveyed say AI is now a requirement for competitiveness. And 97% say AI is already embedded across core manufacturing and supply chain workflows. These numbers indicate a level of standardization that didn’t exist a year ago.

Speed of deployment is now the differentiator over adoption alone. Companies that implemented AI into their processes early have an advantage they’re now extending.

The old question was whether. The new question is how fast.

A majority of survey respondents expect AI to drive 50% or greater productivity improvements. And the data is clear about where those gains come from: the biggest single-year move in the entire dataset was AI adoption in supply chain management, up eighteen points year over year.

Industry leaders are clear that AI needs to augment specialized manufacturing expertise and improve decision quality throughout production and supply chain workflows. The platforms using AI to standardize DFM and quality data from design through fulfillment are the ones that deliver.

AI will boost engineer productivity

Manufacturing leaders are clearly optimistic about AI’s impact on productivity. Nearly nine in ten expect AI to make operations more productive, and more than half believe those gains will be significant — with 59% anticipating improvements of 50% or more, while just 2% think AI won’t move the needle. The overall sentiment is clear: AI isn’t seen as a marginal upgrade, but as a powerful driver of meaningful productivity gains across manufacturing and supply chain.

Ninety-three percent of leaders reported engineering productivity would significantly or moderately improve if those tasks could be offloaded to a managed digital manufacturing or supply chain service. The payoff is speed: faster timelines from prototype to production, with more iterations along the way.

Reactive sourcing is a losing strategy

The percentage of industry leaders who call geopolitical instability a significant factor in their long-term supply chain strategy rose from 51% in 2025 to 71% this year. Raw material cost pressure hit 98%. Many teams have had to make moderate to major changes to their sourcing strategies as a result.

The companies weathering these hits without breaking production schedules built optionality into their workflows before they needed it. Pre-qualified alternative suppliers and material substitutions mean a tariff shift or cost spike doesn’t restart coordination from scratch. Regional networks absorb disruption without resetting program timelines. When conditions shift, they’re already positioned to pivot.

What’s notable is where this response is coming from. Engineering teams are playing a much bigger role in tariff mitigation than they were a year ago, redesigning parts and changing materials as a direct response to trade policy. Supply chain pressure now impacts upstream product decisions. That dynamic makes regional strategy less of a logistics question and more of a design question.

Regional resilience is no longer optional

Most manufacturing and supply chain leaders are pursuing U.S. manufacturing growth, North American capacity expansion, and global diversification at the same time—81%, 59%, and 49% respectively. The most capable organizations are doing all three at once.

Across five years of data, commitment to U.S. manufacturing has increased every year. This year shows the strongest shift yet. The industries driving it hardest—EV, MedTech, Climate Tech—are all onshoring simultaneously and competing for the same resources. Domestic capacity is essential, and there’s only so much to go around.

Regional hubs beyond the U.S. remain important. Mexico, Canada, and Japan continue to play meaningful roles for programs that need proximity to U.S. engineering, deep industrial experience, or specific manufacturing capabilities. Organizations building those networks now, with the operational visibility to coordinate across them, will have options available that latecomers won’t. And the gap only widens the longer they wait.

Supply chain is where programs are won or lost

Manufacturing planning is the single most cited supply chain challenge of 2026, as named by 62% of leaders.

By the time production starts, the decisions that determine supplier availability, lead times, and even scalability have already been made. And once a planning failure becomes visible, it’s already expensive.

This reinforces a recurring theme that runs through the report: supply chain isn’t a downstream function anymore.

The decisions that determine whether a program ships on time, at cost, and at quality are being made in the design phase. Getting supply chain into that conversation early—before architecture, tolerances, and material choices are locked—is how the best programs are run.

Quality and compliance are table stakes

Nearly all leaders prioritize quality metrics like on-time delivery, sourcing strength, and production capacity—and across every industry surveyed, those last two top the list when selecting a manufacturing partner. Ninety-eight percent say supplier certifications matter to how they evaluate partners, with strong emphasis on traceability, inspection reports, and ISO certifications.

The data couldn’t be clearer: supplier selection is moving toward data-backed performance over sales call promises, and transparency is outweighing price in high-stakes decisions. Manufacturers that invest early in demonstrable quality certifications will win more programs because they’re lower risk, even if they come at a higher price point.

Sustainability is now a sourcing requirement

Seventy-three percent of leaders say implementing sustainable practices is “very important,” up from 60% in 2025. Ninety-six percent factor sustainability into purchasing decisions. That shift is showing up in sourcing decisions, supplier selection, and network design—and leaders want to see solid metrics to back it up.

The metrics that matter vary by industry. Climate Tech and EV are leading on intensity, and what qualifies as best practice there looks different from MedTech or Robotics. Understanding what proof points your customers need to see and building around them specifically beats a generic approach every time.

Enterprise companies are more likely to have sustainability governance already in place, and that pressure flows downstream. Mid-market suppliers are increasingly being held to standards set by their biggest customers. Customers, regulators, and large OEMs expect credible sustainability data, governance, and reporting—and being able to produce it is quickly becoming a prerequisite for competition.

Where manufacturing is headed next

Running through every section of this report is a common thread: the strongest manufacturing organizations make foundational decisions early. They invest in supplier relationships, production processes, and data infrastructure before pressure arrives—and pressure always arrives.

The next phase of manufacturing will reward teams that make progress more predictable. Companies need to build flexibility into designs, pre-qualify options across suppliers and regions, and rely on networks that can absorb disruption without stalling programs. The organizations that treat this as infrastructure don’t need to predict the future to keep shipping through it.

Download the full 2026 State of Manufacturing & Supply Chain here.