Video Series:
Security and Resiliency in Action
JPMorganChase is championing long-term economic security and resiliency by supporting critical industries including supply chain and manufacturing, defense and aerospace, energy independence and resilience, strategic and frontier technologies, and pharma and healthtech.
Learn more here.
Manufacturing capacity and supply chain reliability have moved from operational considerations to strategic determinants of economic security. Repeated shocks — pandemic disruption, rising geopolitical tensions and renewed competition in critical technologies — have exposed how quickly a missing input can halt production and weaken economic confidence.
JPMorganChase launched the Security and Resiliency Initiative to meet this moment with capital, advice and execution at scale. The initiative is a 10-year, $1.5 trillion effort to rebuild critical industries, including the supply chains and manufacturing capabilities that underpin long-term competitiveness.
Why supply chains are now a national security priority
The strategic implications of interrupted supply chains have become apparent to many leaders as geopolitical risks have delayed critical inputs. One industry that has felt the impact of such disruptions is the global automotive industry, which relies on rare earth magnets sourced almost exclusively from China. Michael Johnson, Security and Resiliency Initiative lead for Energy and the U.S. Government, described the stakes directly: “In April of 2025, when the supply of rare earth magnets got cut off, two months later, auto factories started shutting down.”
For many inputs, the vulnerability is not just extraction but refining and component manufacturing. Andrew Castaldo, co-head of Mid-Cap Mergers & Acquisitions at J.P. Morgan, framed the issue in systemic terms: “There are a whole host of critical materials and other supply inputs that are critical to the overall functioning of our economy, and we need to figure out ways to onshore those materials.”
The need to onshore has led to unique transactions in the sector. For example, in 2025 the U.S. Department of Defense became the largest shareholder and customer of MP Materials, a fully integrated rare earth magnets producer. The deal, in which J.P. Morgan was the sole financial advisor and lead left arranger, nearshores a critical industry at a time when the evolving geopolitical landscape could disrupt supply chains globally.
“There are a whole host of critical materials and other supply inputs that are critical to the overall functioning of our economy, and we need to figure out ways to onshore those materials.”
Andrew Castaldo
Co-head of Mid-Cap Mergers & Acquisitions, J.P. Morgan
The real bottlenecks are often in tiers two and three
Large manufacturers rely on dozens of specialized suppliers whose constraints can become the binding factor. As Castaldo put it, “The end manufacturer has to rely on dozens of individual suppliers of components and pieces for them to produce the ultimate end product.”
One focus of the Security and Resiliency Initiative is to work with clients to map value chains end to end to find where small constraints create outsized disruption. Johnson described the gap between headlines and reality: “We do a lot of research, but we also call our clients, call people that build power plants or nuclear plants and ask them, ‘What are you worried about?’ And what we hear is not always what you read in the press.” Resilience is not only about big-ticket facilities but about overlooked components and specialized capacity.
This is where targeted capital can be a catalyst. The supplier base often includes smaller businesses that need funding to expand and scale. Ben Wilson, co-head of North American Mergers & Acquisitions at J.P. Morgan, underscored the broader value: “By providing the capital to invest in these businesses, we’re creating jobs, we’re strengthening the supply chain, we’re building a better economy with more opportunity for people.”
“We do a lot of research, but we also call our clients and ask them, ‘What are you worried about?’ And what we hear is not always what you read in the press.”
Michael Johnson
Security and Resiliency Initiative lead for Energy and the U.S. Government, J.P. Morgan
From just-in-time to resilience: What changes in capital allocation
COVID and rising geopolitical tensions have accelerated a shift in operating philosophy: away from minimal inventory and toward planning for disruption. “We up until recently lived in a just-in-time economy. Companies were punished for having too much inventory,” said Wilson. “And now, companies are realizing the importance of having stockpiles of things like pharmaceuticals and inputs for advanced manufacturing. One goal of our SRI initiative is to help people adjust to the new way they need to think about having access to the inputs they need to continue to function.”
That mindset change forces a practical rethinking of capital allocation. Resilience requires more working capital tied up in buffer inventory, as well as investment in upstream capacity, dual sourcing, domestic or allied sourcing, logistics, warehousing and risk management so inputs can arrive when they are needed. “We used to focus on having the capability to do all of this advanced manufacturing and then we realized no matter how great the facilities are, they can’t run without the inputs,” said Wilson.
In practice, “just-in-case” means treating supply assurance as an enterprise priority rather than a procurement afterthought. Companies map tier-two and tier-three dependencies, build stockpiles where appropriate, contract for priority access and invest in the processing and refining capacity that often determines whether upstream resources can translate into usable inputs. Boards and management teams are also resetting governance expectations, signaling a greater willingness to spend to build resilience because shocks are recurring and the mentality shift is not going away in the coming decade.
“We up until recently lived in a just-in-time economy. Companies are realizing the importance of having stockpiles of things like pharmaceuticals and inputs for advanced manufacturing.”
Ben Wilson
Co-head of North American Mergers & Acquisitions, J.P. Morgan
The Security and Resiliency Initiative
A missing input can disrupt critical services and erode strategic independence, but targeted capital, better structuring and stronger supplier ecosystems can reduce those points of failure while sustaining long-term competitiveness. Resiliency can be improved through coordinated investment across inputs, processing, manufacturing capacity and workforce. For leaders, the mandate is to treat supply chain resilience as a strategic priority with real capital allocation and clear accountability.
Learn more about the Security and Resiliency Initiative and how the firm is facilitating, financing and investing in critical industries to strengthen economic security and resiliency.
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