During the recent Presidential election cycle one of the campaign issues was the threat of additional significant tariffs on products from China, Mexico, and Canada. Candidate, now President, Donald Trump openly discussed tariffs on China products of between 10% and 60%, and across the board tariffs on product from Mexico and Canada of 25%. These tariffs would be on top of tariffs already in place when Trump took office in 2016, and the significant tariffs that Trump added during his first term that were not reduced by the Biden Administration. As of Monday, February 10th, 2025, it is still unknown where the final decision will land.
While Bison prides itself on being a domestic manufacturer, providing American jobs, there are components that Bison and other sporting good manufacturers import from China that are not available domestically at a competitive price. While Bison sources all of our steel from domestic distributors, approximately 20% of all steel sold in the U.S. is imported, with Canada and Mexico being primary sources, so it is likely that Bison does end up using some imported steel.
Whether tariffs are good or bad for the U.S. economy depends on your perspective, but a few key facts are universally understood.
- Manufacturers who are forced to compete directly with companies in low-cost countries benefit when tariffs on those imported products have high tariffs, especially if they are not selling internationally. Think steel, wine, and electronics.
- Tariffs are not paid by the exporter of products to the U.S., but by the domestic importer who, in virtually all cases, must pass on these additional costs to their customers to stay in business.
- Inflation is caused by a wide variety of complex supply and demand variables, but one contributing factor is the impact of increased tariffs, not only the actual tariff payment itself, but the impact on the supply chain leading to shortages and price inflation.
- History shows that countries who rely on exports to the U.S. will retaliate by increasing tariffs on items that they purchase from U.S. manufacturers making U.S. goods less competitive in those markets.
- Increased U.S. tariffs will result in winners and losers with key winners being select companies that are most impacted by low cost import competition like steel mills, and losers will be consumers, end users, and small companies that will see increases in their costs.
Like many economic policies that seem beneficial on the surface, a closer look sometimes reveals unintended consequences, and Bison wants our dealers to understand the possible impact of the latest additional tariffs on our ability to hold the line on your costs in the future.