Featured From SAM: Latest Tariffs Would Impact Winter Sports Goods

Discussion in 'Skiing and Industry News' started by Philpug, Aug 4, 2019.

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  1. Philpug

    Philpug Enjoying being back on two skis. Admin Pugski Ski Tester

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    SAM Magazine—Washington, D.C., Aug. 2, 2019—President Trump said yesterday that the U.S. will impose a 10 percent tariff on $300 billion worth of Chinese imports, including a great percentage of snowsports products, starting Sept. 1. The move followed two days of trade negotiations with China, which produced little movement. The tariffs will precede another round of trade talks scheduled for September.

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    The tariffs will be placed on the existing "List 4" products, which includes footwear, performance outerwear, gloves, skis, boots, and bindings, helmets, snowshoes, and more, according to Snowsports Industries America (SIA).

    It's expected that the tariffs will apply to goods in transit on Sept. 1. That is likely to include many goods ordered for fall 2019 delivery, and to goods from smaller suppliers in particular, given the production schedules in China. Larger manufacturers typically are at the head of the production line.

    Assuming that the 10 percent tariff goes into effect on Sept. 1, "importers will have to cover the difference for fall 2019 shipments, in many cases," said SIA president @Nick Sargent. "The tariffs will most likely impact retailers and consumers during the next ordering cycle." Prices will generally increase as soon as the tariffs become official, Sargent added, though the extent of any increases, and their timing, are up to individual suppliers.

    Even before the latest declaration, a smaller group of goods have been subject to the 25 percent tariff imposed last May. Those include some categories of ski gloves, knit hats, and sport bags. These tariffs have mostly impacted suppliers, as most orders for winter sports goods were placed ahead of any tariffs, and prices generally did not anticipate the duties.

    "The glove manufacturers that we have spoken to have chosen to absorb the initial 25 percent tariffs," said Sargent. "For many suppliers, this 25 percent increase over any existing tariffs will wipe out their margin."

    Sargent noted that the uncertainty around the tariffs, and the speed with which they have been imposed, have forced companies to devise strategies on the fly. Many, he said, "are still determining their best approach."

    "Throughout this process, the Administration has made announcements, then rescinded some, so we’re never sure whether anything is official until it's signed," Sargent said.
     
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    Philpug

    Philpug Enjoying being back on two skis. Admin Pugski Ski Tester

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    ADMIN WARNING:

    This is an important topic as it relates to the skiing industry. This thread will be kept solely to skiing/snowsports related issues. ANY discussion other than as it relates to skiing/snowsports will be immediately removed without any other warning than this. Repeated offenses will be dealt with accordingly. If you cannot keep your comments on track, please do NOT reply.
     
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  3. Tricia

    Tricia The Velvet Hammer Admin Pugski Ski Tester

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  4. Jwrags

    Jwrags Aka pwdrhnd Skier

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    Guess those Stocklis I was eying are looking better.
     
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  5. SBrown

    SBrown Steve Admin Pugski Ski Tester

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    So, what do we stock up on before prices go up?
     


  6. Brian Finch

    Brian Finch PT, CSCS, Cert- DN, FRCms, M|WOD Coach Industry Insider

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    I have seen some wholesale prices for skis this year and I would say whatever you can get your hands on from last year!

    Brand ______ race skis cost nearly $200 more at wholesale this season with all that metal.

    I’ve also heard from Moment that their materials costs are up excessively.
     
    Last edited: Aug 4, 2019
  7. Tricia

    Tricia The Velvet Hammer Admin Pugski Ski Tester

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    The good news is that @KULKEA bags are NOT made in China!
    WHEW!!
     
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  8. Dave Petersen

    Dave Petersen Graphic Designer/Vintage Gear Historian Admin

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    That's the first thing I thought of!
     
  9. fatbob

    fatbob Making fresh tracks Skier

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    Not entirely sure what the point of having this as a thread rather than a news item is. Really really hard to avoid political comment as this is ENTIRELY a consequence of a political issue?

    Not something anyone in the ski industry I'm guessing will have wanted bar the hi end made in USA or Europe manufacture
     
  10. Pat AKA mustski

    Pat AKA mustski Making fresh tracks Skier

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    On the bright side, this is good news for American manufacturers?
     
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  11. SBrown

    SBrown Steve Admin Pugski Ski Tester

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    Pretty much everything is the consequence of a political issue in one way or the other, no? I think the point is that no matter why, or from whom, it affects us as skiers. What next?
     
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  12. SBrown

    SBrown Steve Admin Pugski Ski Tester

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    Well, clearly that's the point. But at what cost, and what unintended consequences? Even American manufacturers use foreign materials. I don't really know what all it encompasses, hopefully someone will give us the Cliffs Notes.
     
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  13. Erik Timmerman

    Erik Timmerman Making fresh tracks Instructor

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    Depends on where their materials come from.
     
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  14. Tricia

    Tricia The Velvet Hammer Admin Pugski Ski Tester

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    For whatever reasons, (too many to list) American Manufacturing of these kinds of goods has been all but abandoned over the past 40 or 50(?) years.

    What will it take to amp up USA Manufacturing of these kind of products?
     
  15. markojp

    markojp mtn rep for the gear on my feet Industry Insider Instructor

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    Us willing to pay more.
     
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  16. Talisman

    Talisman Getting off the lift Team Gathermeister

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    The manufacturing base required for ski clothing isn't to difficult to ramp up and skis are slightly more equipment intensive which is why there are boutique ski manufacturers dotted around the US. The labor cost differential may drive production of ski togs to Viet Nam, Malaysia, Sri Lanka and other low cost labor countries.
     
  17. peterm

    peterm Getting on the lift Skier

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    I wonder if some of the US independents like Moment and ON3P will be bumping up their production runs based on this.
     
  18. Erik Timmerman

    Erik Timmerman Making fresh tracks Instructor

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    It doesn't have to be in the US, it just has to be anywhere other than China. It's not like the manufacturers didn't know this would happen. Many have already moved to Vietnam, etc.
     
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  19. Ron

    Ron AKA Captain Voltaren Pugski Ski Tester

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    .

    spot-on, except that many times components of goods have to be sourced and then shipped to other countries for completion. @Erik Timmerman also correctly stated that the costs for domestic manufacturing are also impacted dramatically. its a global economy where all kinds of goods are produced in different countries and even shipped back and forth as the products are finalized . Small producers like Moment, DPS, never summer, ON3P and others will be greatly impacted by the increased costs and their profit margins and operating costs are far less flexible and much more susceptible to these increases. Even Kulkea almost certainly uses materials produced in China. Where things are manufactured is not how tariffs are determined; it's based on where each individual component of that item are sourced from in addition to where the final product a consumer buys is shipped from. for example, Kulkea may source their zippers and fabric from China and then complete the bags in the USA but will pay tariffs on the zippers and fabrics.

    I would love to hear from DPS, Moment, ON3P. @Philpug and @Tricia you know these folks, how about some comments from them so we don't have to speculate?

    BTW- its not just ski's its almost everything we use for winter (and outdoor) sports.
     
  20. Tricia

    Tricia The Velvet Hammer Admin Pugski Ski Tester

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    I have some messages in to a few and will be talking to them in the next few days.
     
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