Hormuz Impact: Over 60% of Manufacturers Report Severe Business Impact, Only 4.5% Can Fully Pass on Costs - Survey on the Impact of the Hormuz Strait Situation on the Manufacturing Industry

Resilire Inc. (Headquarters: Minato-ku, Tokyo; CEO: Yudai Tsuda; hereinafter 'the Company') conducted a survey titled 'Survey on the Impact of the Hormuz Strait Situation on the Manufacturing Industry' targeting executives and managers in the manufacturing industry with 500 or more employees.

Please refer to the survey report for details. https://www.resilire.jp/download-report-hormuz

Survey Summary: Impact of the Hormuz Strait Situation on the Manufacturing Industry ● Over 60% report a 'severe blow to performance and business continuity' ● Approximately 40% face the limit of business continuity within six months ● Only 4.5% have been able to fully pass on cost increases ● Main reasons for inability to pass on costs are 'fear of competition' and 'power dynamics with business partners' ● Over 60% have seen procurement costs increase by more than 10% year-on-year

Survey Results ① Severity of Impact on Own Company: Over 60% Report 'Severe Blow to Performance and Business Continuity' The combined percentage of those reporting 'level affecting performance' (48.4%) and 'level hindering business continuity' (13.6%) reached 62.0%. Only 7.4% reported 'no impact', indicating that the impact of the Hormuz Strait situation is widespread across the entire manufacturing industry.

② Approximately 40% Face Limit of Business Continuity Within Six Months 'Around half a year' (29.2%) was the most common response, and the combined percentage of those facing limits within six months, including 'less than one month' (0.8%) and '1-3 months' (10.6%), reached 40.6%. Only 21.8% of companies responded that the impact is 'limited', revealing that a majority of companies are losing their managerial leeway as the situation prolongs.

③ Only 4.5% Have Been Able to Fully Pass on Cost Increases The combined percentage of those who have 'hardly passed on costs' (31.8%) and 'not at all' (16.4%) reached 48.2%, nearly half. Only 4.5% of companies have been able to 'fully pass on costs'. While 'partially passed on' was the most common response at 44.3%, very few companies have been able to fully reflect the cost increase in prices, with many continuing to absorb the rising costs internally. The percentage of those 'not at all able to pass on costs' was higher for parts/materials manufacturers (21.7%) than for finished goods manufacturers (11.2%), a difference of 10.5 percentage points, showing a trend where midstream and upstream suppliers are being forced into a situation where they cannot pass on costs at all. If this inability to pass on costs continues, upstream companies will be weakened, and eventually, some businesses will no longer be able to sustain their supply. The withdrawal or bankruptcy of a single company could halt procurement for countless downstream companies.

④ Main Reasons for Inability to Pass on Costs: 'Fear of Competition' and 'Power Dynamics with Business Partners' 'Fear of losing customers to competitors' was the most common reason at 38.1%, indicating that the biggest factor preventing price pass-through is the fear of competition. This was followed by 'selecting the timing for negotiations' (35.4%), showing that more than one in three companies have the intention but have not yet executed. 'Power dynamics with business partners' ranked third at 30.9%, indicating a double barrier of market competition and transactional structure hindering cost pass-through.

⑤ Over 60% See Procurement Costs Increase by More Than 10% Year-on-Year '10-30% increase' was the most common response at 45.8%, and the combined percentage of those with an increase of 10% or more, including '30-50% increase' (17.0%) and 'over 50% increase' (4.4%), reached 67.2%. More than one in five companies (21.4%) saw procurement costs jump by 30% or more year-on-year, a scale of cost increase that fundamentally shakes the profit structure of the manufacturing industry. Only 7.4% reported 'almost no change' or 'decrease', making companies that avoided increases a minority.

Survey Overview Survey Name: Survey on the Impact of the Hormuz Strait Situation on the Manufacturing Industry Survey Method: Internet survey Survey Period: May 2026 Survey Target: Executives and managers involved in decision-making related to 'procurement/purchasing/materials' in the manufacturing industry with 500 or more employees Number of Respondents: 500 (Finished goods manufacturers: 250, Parts and materials manufacturers: 250)

Supply Chain Risk Management Service 'Resilire' This is a risk management platform that collects, updates, and visualizes upstream supply chain information, including beyond first-tier suppliers, to achieve advanced risk management. It visualizes the supply chain in collaboration with suppliers and detects risk factors (disasters, accidents, geopolitical risks, etc.) in real-time. It supports understanding the scope of impact, initial response, and risk analysis and evaluation during normal times, realizing a resilient supply chain. It contributes to strengthening the supply systems of many manufacturing industries, including pharmaceuticals, chemicals, and automotive. Service site: https://www.resilire.jp/

Company Overview ・Company Name: Resilire Inc. ・Representative Director and CEO: Yudai Tsuda ・Business: Planning, development, operation, and sales of the supply chain management service 'Resilire' ・Established: September 2018 ・Headquarters: 10F, Tokyo Port City Takeshiba, 1-7-1 Kaigan, Minato-ku, Tokyo ・Corporate URL: https://corp.resilire.jp/