Analysts say the decision could hurt US moldmakers but […]
Analysts say the decision could hurt US moldmakers but would help American plastics companies that supply automakers.
In late December, the Trump administration unexpectedly suspended a 25% tariff on Chinese imported injection molds. Analysts said the decision could hurt US moldmakers but would help American automakers supplying automakers.
The US Trade Representative Office’s announcement means that as part of the first $34 billion tariff imposed by the United States on Chinese imports, the Trump administration’s 25% tariff on Chinese injection molds will be suspended for at least one in July. year.
The US Trade Representative Office did not explain why the decision was made, but a moldmaker in the mold manufacturing industry said that this may be an exemption tariff requirement for more than 200 injection mold companies (many companies are part of the automotive supply chain) for specific mold imports. Response.
The statement from the Office of the US Trade Representative covers a wider range of products than molds. According to this statement, about 30 different categories of imported goods will receive a tariff exemption, and the mold is the largest category under plastics.
“I believe they have received a number of requests from companies seeking exemption from mold tariffs, and the government has decided to fully exempt the molds without time and effort to process each company’s exemption request,” the US mold headquartered in Indianapolis. H. Alan Rothenbuecher, a lawyer at the Manufacturers Association, said. "No one knows for sure, but this is my opinion."
Rothenbuecher, a partner at Cleveland-based law firm Benesch, Friedlander, Coplan and Aronoff, said the ruling would damage US moldmakers but would help US plastics companies purchase molds.
Rothenbuecher wrote in an e-mail: "The [US] mold maker community has been and is a strong supporter of these tariffs."
However, plastics processors say that the high cost of 25% tariffs is difficult for them to digest, causing serious problems for businesses that are already very price sensitive.
Automotive suppliers are affected
Many people told the US Trade Representative's Office that they could not make pre-arrangements for a 25% tariff because mold purchases took months and they had signed a contract for the mold before discussing the tariff details.
For example, Plastikon Industries has requested a “one-time exemption” for molds ordered from a US automaker from China by the end of 2017.
“Given the timing, size and technical requirements of the car release, the company could not change the supply of related molds from a US supplier,” the company said.
Plastikon Industries said that a 25% tariff would "cause huge economic hardships" and could force it to cancel its multi-year contract with automakers, leaving its workers in a factory in Kentucky unemployed.
Automotive industry response
More than half of the tariff exemption requests come from injection molding companies in the automotive supply chain and believe that tariffs will increase costs or slow vehicle development.
For example, Yanfeng American Automotive Interior Systems Co., Ltd. submitted more than 80 requests, and Forteq North America submitted more than 20 copies, while International Auto Parts Group (IAC) North America and Faurecia America Holdings demanded more than 10 mold tariff exemptions.
IAC was founded by Trump's Commerce Minister Wilbur Ross. The company pointed out that its Chinese mold supplier was directly designated by the customer Ford Motor Company because the US mold manufacturing industry did not have the ability to meet Ford's needs.