$200 Billion In New Chinese Tariffs Affects RV Industry

On Monday, President Donald Trump announced a third round of tariffs is being placed on $200 billion worth of imports from China. The new tariffs will take effect on September 24, 2018 and be set at a level of 10 percent until the end of the year. On January 1, the tariffs will rise to 25 percent. According to the announcement, if China takes retaliatory action against U.S. farmers or other industries, further tariffs on approximately $267 billion of additional imports will immediately be pursued. On Tuesday morning, China announced it has no choice but to retaliate against the new tariffs.

These new tariffs are a result of the Section 301 investigation the United States Trade Representative (USTR) has been leading for more than 12 months. The USTR has concluded that China is engaged in numerous unfair policies and practices relating to U.S. technology and intellectual property – such as forcing U.S. companies to transfer technology to Chinese counterparts. 

Included on the list of items subject to these new tariffs are many products of concern to the RV industry, including tires, wheels, propane tanks, fabrics, carpet, plywood, refrigerators, appliances and parts, plumbing goods and accessories, and various raw metals. Mike Ochs, director of government affairs testified on the impact these new tariffs will have on the RV industry last month.

In his testimony, Ochs stated that the proposal to include trailer tires, propane tanks and steel and aluminum wheels as items subject to the Section 301 tariffs, will severely impact supply chains, artificially raise costs to produce an RV and could even negatively influence sales of RVs.

“These effects are not what USTR had in mind when it first put forward the Section 301 proposal. As USTR itself stated, remedies under this Act are supposed to eliminate the unfair trade practices of the Chinese government related to the forced transfer of U.S. technology and intellectual property,” said Ochs. “The proposal to place a tariff on tires, propane tanks and steel and aluminum wheels from China achieves neither of these goals, while negatively affecting a healthy U.S. manufacturing sector.”