Chinese Equipment

[Rich Enders]

The US Trade Representative published today the list of 818 items being imported from China that will be subject to a 25% tariff being collected starting July 6. Additionally there are 284 proposed items that are going to public notice for comments and hearings. My read through looks like mainly electronics and high tech, but it also includes a broad sweep of everything related to plastics, and as you will see below woodworking.

In the second grouping mentioned above are 3 HTSUS codes that cover most woodworking machinery, attachments, and parts (8465.95.00, 8465.96.00, and 8466.30.80).


If you go to the USTR website the detail is available in their June 16 press release which includes links to the 38 page (at 30 to the page) list of codes that are either subject to the tariff, or being considered.


Hopefully this is posturing to sway trade negotiations, but it is reality at the moment.

Rich Enders

[Osvaldo Cristo]

We live in a very inter related world. It is difficult to isolate anything, country, company or individual. See bellow an example of who owns who at tool market (I am not sure if it is up to dated):

387923

All the best.

[Jim Becker]

Let's keep this discussion purely on the impact on the market for tools and tool pricing that any new tariffs might bring and stay well away from any political aspects as they are not permitted by the SMC TOS. I'm mentioning this now so that this thread doesn't go in a direction that will make it go "poof" and disappear.

Thanks in advance!

Jim
Forum Moderator

[Rick Potter]

Wonder if Taiwan is grouped with China for trade issues? Lots of Grizzly tools are made there.

[Matt Day]

Not much else to say that’s not political in nature. Things seem to be going swimmingly with these tariffs.

[Simon MacGowen]

Wonder if Taiwan is grouped with China for trade issues? Lots of Grizzly tools are made there.

Not directly, because the tariffs are aimed at China. They will affect those Taiwanese investors who have set up manufacturing plants in China whose products are on the tariff list. Taiwan-based producers of parts destined to China for final assembly of other goods will also be affected for exports to the US.

Regardless of how the trade wars (not singular if the current path of developments stays its course) are framed, some sectors will be winners and some losers.

Simon

[johnny means]

First Festool prices, now the cheap atuff too. Seems like we'll be getting squeezed from both ends.

[Bill Dufour]

I have some slight knowledge of traditional Japanese wood working tools and methods. I know nothing of the history of Chinese woodworking. I assume the Chinese invented lacquer finishes and probably use pull saws like the Japanese other then that I have no idea's.
Bill D

[Brad Alexander]

It's not just the manufacturers listed, these companies have spread out all over the planet and the supply chains that feed them can affect manufacturing all over the world. It's going to be interesting how the ripple effect effects all of us, and not just tools, but every day items as well.
I hope they get it straightened out, its always us that pay for these things.

[Mike Cutler]

I have to imagine that Walmart is going to feel this impact.

In looking at the picture in Osvaldo's post, it's amazing that Makita and Hilti stand alone with their product lines. I remember when Makita was considered kind of "junky".

[Tim Bueler]

Back in the 80's B & D was the main driving force in getting congress to enact tariffs on imported power tools. Seems they were getting quite a bit of competition from Makita. Kind of back fired on them...Makita built a plant in Buford, Georgia. I remember researching to buy a new circular saw. Ironically, B & D's saw, the Sawcat I think it was, was built from parts mostly made in Mexico but ASSEMBLED in the U.S., which made them "Made in USA" under the terms of the tariff. Makita's 5007NB (I still own 2) was assembled from parts mostly manufactured, and completely assembled, right there in Buford.

I suspect these current rounds of tariffs will be nothing more than an inconvenience for the power tool companies as they figure out a work around as they did back in the 80's. Perhaps an excuse to raise consumer prices.

[Darcy Warner]

Good, fine with me.

[Simon MacGowen]

Good, fine with me.

Agreed. I like to see how these trade wars get resolved, one way or the other. Someone calls the bluff, let's get the cards shuffled. As I said, there will be losers and there will be winners. Who knows? May be the resulting increases in costs would drive people to be less wasteful.

Simon

[Peter Christensen]

When that happens I'd suggest buying them from here in Canada where they would be cheaper but we're getting hit with tariffs too so probably won't help.

[David Kumm]

US Tariffs on average are something like 60% of the average foreign tariff so it is time to look at the system. In my town we produce paper and cranberries. Europe imposes a 22% tariff on our cranberry products. Eu can't grow their own so its not like they are protecting their own industry. Our paper mills were shutting down and sitting idle due to the influx of Chinese paper. Recently a mill was bought by Nine Dragons, a large Chinese company who is putting a lot of money back into it. The reason is fear of tariffs on Chinese paper. There will be winners and losers short term but the goal should be long term. Other countries tend to be better at the long view. Dave

[Warren Lake]

you had a big source of paper in Hemp but late night radio said a particular family who might have a castle near LA had it made illegal by buddies in congress, they owned tons of land and didnt want anything threatening their source of pulp and paper.

[Bill Dufour]

US Tariffs on average are something like 60% of the average foreign tariff so it is time to look at the system. In my town we produce paper and cranberries. Europe imposes a 22% tariff on our cranberry products. Eu can't grow their own so its not like they are protecting their own industry. Our paper mills were shutting down and sitting idle due to the influx of Chinese paper. Recently a mill was bought by Nine Dragons, a large Chinese company who is putting a lot of money back into it. The reason is fear of tariffs on Chinese paper. There will be winners and losers short term but the goal should be long term. Other countries tend to be better at the long view. Dave

I have to doubt that China has sustainable yield forestry practices to allow paper production to continue for decades at the current rate. Of course they may be using bamboo for raw materials. I would assume clearcut logging leading to widespread deforrestation and then centuries to get production back to sustainable levels.
Does Wisconsin have second growth forests that are big enough to resume logging?
Bill D.

[David Kumm]

I believe the Chinese import a lot of their pulp. The pulp industry in Wisconsin was always a key reason that coated paper was made here due to the quality of the trees and the near location. Dave

[Alex Zeller]

I wonder if Grizzly is going to be pushing really hard for their backordered tools to get shipped. I suspect that with a 25% tariff they will loose a number of orders unless orders placed before the date the tariff starts are exempt. I'm also curious to see just how much of an impact it will have on Taiwanese equipment. How will the tariffs handle equipment made elsewhere but with parts from China?

[matt nexgen]

Do you have a link to the list?? Thank you

[Rich Enders]

As written, the relevant date is the date of arrival of the import at the US port of entry. Probably too late to get a booking for a sea shipment. Air will do if it is affordable. It does not matter when the contract was signed, or the order placed.

Made in USA, or Made in China, or Made in Taiwan or wherever is hard to get a handle on. I have tried a number of times to get a workable definition without much success. I am in plastics. Is it where the oil or natural gas came from to make the petrochemical which becomes the plastic, which becomes a molding for use in an auto? The same with machinery. Is it the origin of the steel or the value added in making components, or....?

If anyone out there knows I would like to hear from you. Rich

[Rich Enders]

Matt, No link, but if you go to the USTR website the detail is available in their June 16 press release which includes links to the 38 page (at 30 to the page) list of codes that are either subject to the tariff, or being considered. If needed I can email the list(s) to you. Rich