Manufacturers Brace for Impacts of Increased TariffsMay 13th, 2019 by Amber Galaviz
Despite months of negotiations, President Donald Trump announced an increase in tariffs on more than $200 billion worth of Chinese products Friday. Fenestration products—including iron, steel and wood door, window and frame components—are among the Chinese goods affected by the newly imposed 25% tariff, up from the 10% rate implemented in September 2018.
The administration also plans to impose a 25% tariff on approximately $300 billion of additional Chinese products.
Prior to Friday’s announcement, a report from the U.S. Department of Commerce showed the country’s monthly goods deficit with China was the lowest it’s been in five years. In a statement released last week, the Coalition for a Prosperous America (CPA) noted the report as “a clear indication that the Trump administration’s tariffs on Chinese imports are having a substantial impact on U.S. trade flows.”
“To the president’s credit, the tariffs are working,” said CPA chairman Dan DiMicco. “America’s manufacturers and workers are now seeing gains as manufacturing employment rises and China’s hold on the U.S. market shrinks.”
But not all manufacturing businesses are so sure. Even before the tariff increase was announced, companies were preparing for what it could mean for their business. The Window and Door Manufacturers Association (WDMA) has stressed its concerns with what the increase would do to door, window and skylight manufacturers, as well as those in the residential and commercial construction business.
Following the news, WDMA director of governmental affairs, Kevin McKenney, said the association plans to “engage with [U.S. Trade Representative (USTR) Robert Lighthizer] to ensure our members are not adversely affected.”
“One of the challenges is that these tariffs are a relatively new approach for U.S. trade policy and many companies and associations are still gauging that impact, including WDMA,” he stated via email Friday. “It will likely take some time for our industry and others to determine the full effects.”
The WDMA has already sought exemptions from some products impacted by the tariffs. The organization plans to work with USTR going forward.
“Looking ahead, the discussions with the Chinese government on a long-term deal will be an important gauge in assessing how long these tariffs will be in place,” McKenney added. “In the meantime, we will be continuing to work with USTR on specific product exclusions for this list. WDMA has had success with USTR in the past when they agreed to grant our exemption request from a 25% tariff on the first list of Chinese products and will be looking to build on that success for our members in the coming weeks and months.”
Meanwhile, officials from the American Architectural Manufacturers Association (AAMA) are anticipating when and how manufacturers and professionals in the glass industry will be impacted.
“It is unfortunate that an amicable solution couldn’t be negotiated, especially given the potentially far-reaching consequences of the latest tariff increase,” said AAMA executive director Janice Yglesias. “The impact on many fenestration industry companies will be felt to varying degrees since the materials being impacted are used in numerous components as well as manufacturing machinery. Some companies rely on materials from China to build products in America, which could be detrimental to many in our industry. The complexity of this issue warrants a multi-faceted comprehensive strategy in order to implement an effective solution.”
The process for public notice and comment will be published in the Federal Register.