Trump approves tariffs on Chinese goods including $1 billion in bike products

[benb]

Anyone got any info on how this affects the bicycle industry since it was mentioned in the title?

My impression is it's WAY easier for Trek or someone to kickstart a little more production in the US than it would be for Apple, or even Specialized.

The barrier to entry for bike production is so much lower.. maybe it's hard to get mass supplies of Carbon fiber, etc.. in the US but it's not like electronics where it will require billions of dollars of startup costs to build a factory here.

I'd guess this could benefit someone like Trek that still has some US production vs someone like Specialized that has never really had any US production?

I forget what the specs are but say they are making 7 series Madones here.. there is probably plenty of profit margin to keep making 5/6 series bikes in Taiwan but how hard would it actually be to start making some of those 5/6 bike alongside the 7 bikes.

Or how hard would it be to start making the upper series Domanes/Emondas in the US as opposed to Madones? (AFAIK they only make Madones in the US?)

There are electronics companies like Apple that actually do have the cash reserves/finances to bring manufacturing back if the trade environment favors it... but is it even worth spending those billions if Trump changes his mind or he's out of office in a couple years and whoever gets in next immediately reverses all this stuff and makes US manufacturing seriously disadvantaged again? Even if Trump was guaranteed another 4 years it seems like any giant electronics/computer investment to bring anything back is incredibly risky.

No amount of tariff can ever produce the workforce that might be required too, and we have very low unemployment right now..

[verticaldoug]

https://ustr.gov/sites/default/files...t_09.17.18.pdf

here is 194 pages of the tariff
this is what it looks like in reality.

number 3, edible ofal of bovine animal, fresh or chilled.


what about the frozen kind?

The first 25 pages makes me think the prices at Chinese Restaurants is going up.

[jh_on_the_cape]

Politics. Do it before November. Play your cards now because someone else might be holding them soon.
A real functional policy would take time and be hard for people to understand.
I think we should switch to a benevolent dictatorship run by the Paceline forum illuminati. REVOLUTION!

Originally Posted by Mzilliox

thanks for this, i could not have written it so well. but this has been my understanding so far of the situation, or at least very similar.

I find it fascinating the government is "playing all its cards now" so to speak. why make some of the moves during an economy showing strong job growth, and good GDP numbers. why claim is the best economy ever, then make these additional moves normal reserved for corrections? I am also fearful of an economy so heavily reliant on cheap debt, with interest rates rising, and inflation soon to follow.

why play these games when the focus could be on policy that helps Americans get things they need? things like real wage growth surpassing inflation, health care, education, you know, things we actually consume that could make daily life better for all.

[fiamme red]

Originally Posted by verticaldoug

https://ustr.gov/sites/default/files...t_09.17.18.pdf

here is 194 pages of the tariff
this is what it looks like in reality.

This is quite detailed!

"3926.90.96 Casing for bicycle derailleur cable;and casing for cable or inner wire for caliper and cantilever bake (sic), whether or not cut length; of plastic"

[93KgBike]

"6815.99.40 Articles of stone or of other mineral substances (including carbon fibers & articles thereof)"

Do these tariffs include Taiwan?

[fiamme red]

Originally Posted by 93KgBike

Do these tariffs include Taiwan?

No.

[delish]

I was combing through the list for other non-bicycle items this morning.

Here are some bicycle HTS codes I found. expect to pay a lot more for these things in the future:

3926.90.96 bike cables and housing
4011.50.00 New pneumatic tires, of rubber, of a kind used on bicycles
4012.90...Bicycle rim strips
4013.20.00 Inner tubes of rubber, of a kind used on bicycles
8512.90.40 Parts of electrical lighting equipment of a kind used on bicycles

8712.00... basically all bicycles...

8714.91... Parts & accessories for bicycles, frames, forks, and parts of frames

9029.20.20 Bicycle speedometers

8714.92.... Pts. & access. for bicycles: wheel rims, wheel spokes, hubs, brakes, saddles, pedals and parts, cranks/cranksets/gears

[gdw]

"Anyone got any info on how this affects the bicycle industry since it was mentioned in the title?"

Here's an article covering how it might impact the outdoor and cycling industries.
https://www.outsideonline.com/234086...se-gear-prices
There are other articles with more info that you can access at the bottom of the page.

[fiamme red]

It's interesting to me that helmets are not in the list.

I suppose they're included in "3926.20.90 -- Articles of apparel & clothing accessories, of plastic, nesoi"?

[Mark McM]

Originally Posted by benb

Anyone got any info on how this affects the bicycle industry since it was mentioned in the title?

My impression is it's WAY easier for Trek or someone to kickstart a little more production in the US than it would be for Apple, or even Specialized.

The barrier to entry for bike production is so much lower.. maybe it's hard to get mass supplies of Carbon fiber, etc.. in the US but it's not like electronics where it will require billions of dollars of startup costs to build a factory here.

I'd guess this could benefit someone like Trek that still has some US production vs someone like Specialized that has never really had any US production?

While Trek might have held off moving production overseas longer than other large US bike manufacturers, currently 99% of Trek's production is overseas. Trek will be affected as much by bicycle tariffs as any other large US bike manufacturers, and I don't see them ramping up US production any faster than anyone else.

[delish]

Originally Posted by fiamme red

It's interesting to me that helmets are not in the list.

I suppose they're included in "3926.20.90 -- Articles of apparel & clothing accessories, of plastic, nesoi"?

Bike helmets are classified under 6506.10... and therefore not on the new tariff list.

I assume that helmets were not included because it would have been hard to claim that the tariffs were put in place to "help to protect Americans" since, quite literally, the tariffs would have made it more expensive to protect our heads.

[ptourkin]

Just saying, this is the last place a former international trade attorney expected to get PTSD from all the HTSUS talk. Thanks guys

[m4rk540]

Originally Posted by veloduffer

China has one key advantage over other countries is scale in manufacturing. For high volume products, it can build a factory, hire 5,000 workers and be fully operational in a month. That kind of scale can’t be replicated elsewhere in the world. Of course, that model has long term susceptibility to automation from robotics and additive manufacturing. China recognizes that and is pushing to be a leader in technology. Some recent reports are that China has about 300 million engineers; that’s equivalent to the entire US looking for new ideas/processes.



Sent from my iPad using Tapatalk

300 million or 30 million (3 million)? The total labor force is estimated at under 800 million.

[cmg]

the only ones that benefit are the governments collecting the tariffs. does the prez not think that this will effect the costs of those items that rely on Chinese made electronics like cars, motorcycles, tvs...everything at Walmart, Costco, Kmart... His donors are not going to be happy.

[BikeNY]

Originally Posted by Mark McM

While Trek might have held off moving production overseas longer than other large US bike manufacturers, currently 99% of Trek's production is overseas. Trek will be affected as much by bicycle tariffs as any other large US bike manufacturers, and I don't see them ramping up US production any faster than anyone else.

Also, there are already new tariffs in place on the materials they would use to make new frames, like aluminum and steel. Unless they buy from other sources at even higher costs.