How Mexican Tariffs will Impact the Appliance Industry

6.10.19

How Mexican Tariffs will Impact the Appliance Industry

Last year, President Donald Trump slapped a 20% tariff on imported washing machines. The idea was to give retailers and consumers an incentive to purchase from American companies, but as anyone who knows about tariffs will tell you, they almost always end up hurting the American consumer. With hefty Chinese tariffs having been in place for over a year, and tariffs on Mexican imports looming, we’re going to take a look at how they are affecting appliance manufacturers and retailers such as us here at Happys Appliances Outlet.

How Tariffs Work

A tariff is a tax based on a percentage that is placed on imported goods/materials from a specific region or country. Unfortunately, this added cost is usually passed down to American consumers, as companies will usually just raise the price of their imported product rather than just buying American. For example, Trump’s 20% tariff on imported washing machines that went into effect last year increased their price by roughly $86 to $92. Because of the adverse effects on the pockets of American consumers, and the retaliatory tariffs being placed on the US (i.e. China), you’d be hard-pressed to find an economist who thinks that these taxes are a good idea.

What It Means for Shoppers and Retailers

Following Trump’s imposition of tariffs on foreign goods, household appliances experienced their biggest spike in pricing in five years. Some American companies such as Whirlpool were supportive of them at first, as they were handed a competitive advantage over foreign manufacturers such as LG. However, after Trump imposed tariffs on aluminum and steel, Whirlpool’s tune quickly changed, with their CEO declaring that the tariffs have “reached unexplainable levels.”If the President follows through with his declaration that he will impose a 25% tariff on Mexico starting in October, the price you pay for a single appliance could jump by hundreds of dollars. If you’re re-doing your entire kitchen and need to buy multiple appliances, those added costs add up quickly. Let’s hope our President listens to what American consumers, corporations, and politicians are saying and reverses course on his attempted trade war.