Feature Story–Car navigation devices, including those incorporated in a vehicle, are officially on the list of goods getting a 25 percent tariff as of July 6, according to the Consumer Technology Association (CTA). In addition, car amplifiers are on the newer list of Chinese products slated to be tariffed in the next round, it said.
Similarly, Epsilon said it has been informed by its Freight Forwarders that 30 percent of its products are affected either directly or due to tariffs on the components and materials that make up those products, including parts such as tantalum capacitors, alloys of aluminum and others.
Epsilon’s Paul Goldberg said, “A lot of components that have metals, either copper or aluminum or steel, are being affected by this. It’s a two fold increase. The first is just raw material costs have gone up so we’re seeing price increases from our vendors and secondarily, a number of items, almost 30 percent are directly affected…a number of amplifiers; they have a lot of metal parts and a number of head units, a number of specialty items; our bass processors are affected. Right now we’re kind of gathering information to figure out what the real costs increases are and we’re going to be forced into a situation where we’ll see if we’re going to have to raise prices. Unfortunately, it’s not something we want to do. It’s not good for the industry.”
On the other hand, Pioneer’s Ted Cardenas said the company has numerous manufacturing facilities in countries other than China and will be able to shift production to avoid tariffs. “We can make a radio in China today, but we can change it to Mexico or Thailand,” he said. Pioneer’s Mexico facility mainly produces OEM products, but it can also make aftermarket products, he added.
While the first wave of tariffs has already taken effect on $34 billion worth of goods, a second wave is due to take effect this summer on another $16 billion in goods. The Trump administration is also considering imposing yet another 10 percent tariff on $200 billion more in Chinese goods, which would essentially put a duty on most of the products imported from China (but not smartphones).
Sage Chandler, Staff Vice President, International Trade, Government Affairs for the CTA said, “Of the original $50 billion in tariffs on China, items including lithium batteries, navigation devices, disk drives and circuit board components will be affected – hitting $15.2 billion worth of Chinese imports.”
She added, ” While President Trump says his trade policy is meant to punish China, the numbers show that, in reality, U.S. businesses, workers and consumers will pay the price under this policy….The impact of tariffs on the average household means $150 to $306 less income a year.”
The Wall Street Journal reported that the third wave of tariffs (10 percent on $200 billion in goods), will include “Bluetooth speakers, amplifiers, surge protectors and cables that connect computers and other electronic equipment,” according to the CTA.