5 targets in the trade war’s latest fallout
This post was updated on August 30 at 7:20 p.m. ET.
Coats, merry-go-rounds and 100-year-old antiques imported from China are about to get a bit more expensive.
President Donald Trump’s latest round of tariffs will affect $300 billion worth of Chinese goods and are set to go into effect Sunday. While his administration initially planned to tariff these items at 10%, Trump recently tweeted plans to raise the rate to 15%.
The Office of the United States Trade Representative has unveiled the full list of items, which includes agriculture, clothing, electronics, musical instruments and live animals.
Here’s a look at some of the products that will get hit with tariffs and what it will mean for the industries that rely on them.
Lithium-ion batteries
China accounts for 40% of lithium-ion battery imports to the United States; the batteries make their way into everyday products that you probably own.
Such as?
“The iPhone that I’m using right now,” said Kelly Speakes-Backman, CEO of the Energy Storage Association.
Smartphones, electric vehicles and grid energy storage all take advantage of this power source.
“They absorb oversupply of electric generation, and they put power back on the grid when there’s not enough supply,” she said. “So they basically make the grid more efficient, more sustainable.”
Since 2010, the price of lithium-ion battery packs has plunged 85%, according to Bloomberg. Speakes-Backman said decreasing costs are supposed to help grow the battery-storage market.
That is, if if the market is allowed to act on its own without the burden of tariffs that she’s calling unnecessary.
Merry-go-rounds
One tariff code that made the latest list targets all the staples that you’d encounter at a theme park. Specifically, “merry-go-rounds, boat-swings, shooting galleries and other fairground amusements; traveling theaters; parts and accessories thereof.”
Dennis Speigel, president of International Theme Park Services, said the U.S. actually doesn’t import a whole lot of these attractions — it’s the other way around. However, China is trying to build this industry, and Speigel estimates that by 2030, China could be the largest leisure market on the planet.
“At the beginning, I would not get on one of their rides or attractions myself,” he said. “Today, they’re building in China some incredible leisure attractions and some of the biggest and some of the best we’ve seen developed in the last 15, 20 years.”
For those in the U.S. who do happen to import merry-go-rounds from China, Speigel said this 15% tariff could be a “deal killer.” It means that a merry-go-round that is, say, $100,000 will now cost $115,000.
And that’s before packing, shipping, transportation and installation.
Antiques over a century old
Even art collectors weren’t spared.
“There was some befuddlement and concern because this had been previously proposed to be on the tariff list, and we were successful in keeping it off,” said Peter Tompa, executive director of the Global Heritage Alliance.
He pointed to export ware as an example of Chinese antiques that people have gravitated toward.
“So maybe more of your grandma’s generation,” he said. “People liked fancy china in the past.” (Tompa noted if you ever make your way to Mount Vernon, you’ll see some of President George Washington’s china export ware in a display case.)
As for the consequences of this particular tariff, Tompa said he thinks it’s going to be a “real drag on the ability of antiquities dealers to get consignments from abroad.”
He added that a lot of the Chinese antiques collected in the U.S. come from places like Britain or Japan. But this new 15% tariff will still apply since China is the country of origin.
“The net effect of the tariff is it’s not going to punish the Chinese,” Tompa said. “Who it’s going to punish is the American dealers who will have to pay this tariff to bring it into the country.”
Coats
As fall and winter approach, those coats you’ll want to wear for the cooler weather will also be affected by tariffs.
The list includes men’s and women’s overcoats of virtually every type, whether they’re knitted, crocheted or constructed of man-made fibers.
Over the past year, Americans have imported more than 600 million coats, with more than half of those coming from China, according to Julie Hughes, president of the U.S. Fashion Industry Association.
“China really became the hub for a lot of the outerwear production. So if you look at your ski jacket or your rain jacket, there’s a lot of features,” she said. “There might be pocketing, there might be special treatments, there might be linings.”
Hughes said tariffs are already very high on apparel, with some products getting tariffed as much as 32%. Now imagine 15% duties on top of that.
“Prices are going up. I think that’s the thing for consumers to watch out for,” she added.
Fishing equipment
The Trump administration’s tariffs have especially rocked the boating and fishing industries, affecting everything from life jackets to equipment.
“So your rods, your reels, your lures,” said Nicole Vasilaros, senior vice president of government affairs for the National Marine Manufacturers Association. “All the stuff that you need to get out on a boat and go fishing and enjoy a fun and safe day on the water.”
Fish hooks (snelled or not snelled) and fishing reels over $8.45 each were some of the specific products that made the September list.
Vasilaros said the boating and fishing community already pays an excise tax that goes toward conservation efforts — something it approves of. However, this new tariff list means it’s going to be taxed again.
She added that manufacturers will have to choose whether these additional costs are going to be passed on to consumers.
“You don’t want to price people out of the market and discourage them completely from partaking in the activity. So those are some real decisions that have to be made,” she noted.
Check out all of our ongoing trade coverage here.
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