Tariffs are essentially a form of tax levied on specific imported products and services. The effect of this additional tax is that it increases the cost of bringing certain goods into the U.S. Depending on the type of tariff and the country of origin, tariffs affect our industry in different ways.
Tariffs levied on imported raw materials such as copper, aluminum and steel impact the companies that use these imported materials in the production of their products. Items like wire/cable, enclosures, conduit, tools and hardware – any items with high imported raw material commodity content – could be directly affected by this tariff. The current tax on steel import is 25%, while that of aluminum is 10%.
This tariff has led to an increase in demand for domestically produced raw materials. Domestic supply has yet to catch up with the demand, which has led to an increase in the price of domestic materials as well.
Tariffs on finished imported goods, like lighting fixtures, test equipment, motors and other off-shore manufactured items are also being impacted – depending on how much of the finished good or it’s sub-components are produced off-shore. The current tax on finished imported goods is as high as 25% – and likely to increase. This tariff has a huge impact on companies who outsource their manufacturing activities to China, less so for items produced wholly in Europe and other regions
Our suppliers have done their best to absorb their raw material and finished good tariffs. The fact that it is almost impossible for suppliers to absorb all these costs completely means they must now pass the fees along to their customers. Therefore, prices of certain goods keep changing and will probably continue to do so for a while. These additional costs on imported goods are being borne by everybody involved along the supply chain.
Rumsey will continue to look for ways to minimize the impact of these increases and provide alternative solutions whenever possible. For this reason, we feel it is important we communicate what is driving price increases – and what Rumsey is doing to make sure we minimize the impact on our customers.
There are still a lot of uncertainties about these tariffs as nobody is sure how long they’ll last, or whether other goods and services will be subjected to them. We will keep you updated as things develop. If you have specific questions about the items you purchase from us, please talk with your Rumsey Sales Representative.