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Marketplace®

Daily business news and economic stories

Tariffs have left importers ‘upset,’ with more yet to come

"You don't know what's going to happen from day to day sometimes. And plus, the retaliatory tariffs, we don't even know what those are going to be," said customs broker Gretchen Blough.
"You don't know what's going to happen from day to day sometimes. And plus, the retaliatory tariffs, we don't even know what those are going to be," said customs broker Gretchen Blough.
Tomohiro Ohsumi/Getty Images

Last week, President Trump announced his plans to impose a 25% tariff on all imported vehicles, light trucks and some auto parts. Those tariffs will go into effect on Wednesday, April 2.

This latest tariff is yet another addition to the bill of tariffs that the Trump administration has imposed over his first few months in office, and the inclusion of finished goods adds an extra layer of complexity to the already strenuous situation.

“If a large component of steel or aluminum is in the finished good, we basically need to break everything out into a bill of material, and then that 25% only applies to the steel or the aluminum,” said Gretchen Blough, a customs broker manger.

“Marketplace” host Kristin Schwab spoke with Blough about the current state of trade and how the addition of new tariffs creates further uncertainty for U.S. importers. Below is an edited transcript of the conversation.

Kristin Schwab: Can you catch me up on what’s happened since we last heard from you? What is work like right now?

Gretchen Blough: Well, it’s a little crazy. We have the steel and aluminum tariffs that are in effect, and then we have a bunch of other tariffs that are going into effect tomorrow. The steel and aluminum, that has the 25% tariff on it with no exclusions, no exceptions. But there’s also some finished goods that have this tariff on it as well. If a large component of steel or aluminum in the finished good we basically need to break everything out into a bill of material, and then that 25% only applies to the steel or the aluminum, and then the rest doesn’t have the 25% so that’s presenting a problem for a lot of our importers. Because none of us were expecting that, and if they don’t have that information, then everything has the 25% apply to the entire good, which no one really wants that to happen either. But you have weigh what costs more the storage or the tariff at this point.

Schwab: Well, that’s a that’s a lot of ins and outs. How do you even, how do you even keep track of all the nitty gritty when the rules are constantly changing?

Blough: It’s not always easy. Mostly, we’re relying on the federal register when it’s updated. But that’s not always updated right away. We used to have fact sheets available on the government websites and those seem to have gone away. So, we’re relying on a lot of news publications to get a lot of the information as to how things are going to apply, because we don’t have things readily available. So, we’re trying to keep our customers up to date, and our operations folks up to date. And it’s not always easy to do that when we’re not quite sure what’s going to happen. For example, tomorrow, there’s scheduled to be 25% on Canada, Mexico, and also retaliatory tariffs, which we aren’t quite certain what those are going to include for other countries.

Schwab: So, I talked to a small-scale banana importer yesterday who was talking about how she just doesn’t have a lot of alternatives. She’s got to import from Mexico, right? What are you hearing from your clients about buying in America or buying American.

Blough: Well, you see that a lot on comments, on Facebook posts, but that’s not always realistic. There’s a lot of stuff that you can buy that’s made in America that has foreign components. And you know, it hurts manufacturers here, because now they have to pay more for their components. Buy American, It’s not an alternative. The other thing is if the manufacturing does come back to United States for these component parts, it’s going to take some time to build the plants and get things operational in order to source them here in the U.S.

Schwab: As somebody who has an intimate look on the ground of how tariffs are impacting businesses, also your own work, how much planning can you do for the next few months or the year ahead? Or is it just more of a day by day in the moment kind of workplace right now?

Blough: Well, it tends to be just an in the moment type thing. It’s really hard to plan when, as we saw with the tariffs with Canada and Mexico, they’re on again, they’re off again. They’re on again, they’re off again. You don’t know what’s going to happen from day to day sometimes. And plus, the retaliatory tariffs, we don’t even know what those are going to be.

Schwab: Do you have a long day ahead of you? What are your workdays like right now?

Blough: My workdays are answering a lot of questions. A lot of upset importers right now. I’m kind of explaining everything to everyone, having people that aren’t too happy because they had something on the water and in order to import it, it’s cost 25% more than they were expecting. And people trying to explain to me that they’ve had this purchased for six months. Why do they have to pay this now? And I really don’t have a good answer for them, because I’m just the messenger, unfortunately.

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