Following two weeks of talks, China and the US agreed to lift some tariffs in stages, pending final approval of a new trade deal.
The two countries are calling the agreement, “Phase One” of a deal that would have China and the US each remove the same proportion of tariffs on goods at the same time.
In a surprising reaction, some car audio dealers said they would like to see the new pricing on some items stay in place, even if the tariffs are rolled back.
Not surprisingly, some suppliers expressed relief at the news and are hopeful for a final agreement.
“We welcome any progress that can lead to a reduction of the punitive tariffs on imports from China and the corresponding retaliatory tariffs placed on US goods exported to China. This will be excellent news if it can be realized,” said Manville Smith, JL Audio VP Marketing.
President of retailer Performance Auto Sound, WA, Kelly Kirschner expressed the view of several retailers, stating, “Absolutely, keep them higher. I think it’s a good opportunity for us to break a little of the cycle of prices always going down. It’s potential for a little increased profitability. We would love to see that happen.”
Kirschner admitted that the tariffs have had a negative impact on some “isolated” product sales and that it could impact holiday sales. But he said, “I’m willing to take the impact if we’re working on keeping the prices a little higher.”
AudioControl CEO Alex Camara said, “It’s encouraging to see possible progress in rolling back some of the tariffs that have impacted manufacturers and customers across the car audio industry. In particular, US manufacturers that bring in some parts from China…are still paying tariffs on parts for products made in the USA. From the press reports today it is not clear which categories might be included if this potential rollback of tariffs takes place. So until we know more, it is hard to get too excited!”
Regarding the possible deal with China, the tentative agreement marks the first time the US has committed to removing any of its recently enacted tariffs on Chinese goods. As the New York Times stated, “The development suggests the two sides are getting closer to a deal that would provide relief to businesses and consumers that have struggled with the additional costs of tariffs. Mr. Trump and his Chinese counterpart, Xi Jinping, are facing increasing political and economic pressure to resolve their 19-month trade fight, which has inflicted pain on both sides of the Pacific.”