Long Term Impact of Trade War on Woodworking Tool Prices

[RKMBrown©]

Tariifs impact??

Large corporations are experts at the money shell game and small chinese capital venturist have done the same.

Example:  

Fiber laser engraver from China.

Actual manufacture cost = $1500
Manufacturer sales at unit cost of $2900 direct ship to USA consumer.  Add 25% and you end up with $1595 tariff tax. Total $4495 which would impact the consumer directly. The manufacturer will offer to create two invoices, one is what you actually pay them and one for what it actually cost them to produce ( $1500 + $825 tariff = $2325 which is included in the import declaration. So you never feel the impact. Now most American would be afraid of getting caught doing it this way but Chinese based importors aren't burdened by these as they will never be under US law.  
So the Chinese importer buys the laser from the manufacturer in bulk for $2175 and resales it from  US based warehouse via Ebay for $2900 to US consumer. But he gets two invoices from the manufacturer, one the actual cost that only he sees and second the cost that he claims he bought it for from the manufacturer.

Rob

Uhmm I think your calculator is broken.. that or you typed in .55 instead of .25

[OldGuyDrummer]

Typical woodworking forum response, spell check, grammer check and math check and completely ignore the content of the post.Geez.

[Handplanesandmore]

Yes, different invoicing may work for certain vendors or products. But the indiscriminate use of tariffs is going to impact the consumers on the whole as other merchants like Walmart, Target, etc. could not resort to such practice. It is reported even India may lose a special tariff exemption now in place.

No one knows how this will play out, but I would love to see the trade wars (not singular) intensify and go on for one good reason: We can then find out how well or how poorly tariffs really work as a trade tool in practice, and the outcome will serve as a valuable lesson to all, and as a guidance when future tariffs of this scale are pondered.

Simon

[Admiral]

Typical woodworking forum response, spell check, grammer check and math check and completely ignore the content of the post.Geez.

I got your point, but with correct math its a bit less dramatic, no?

[RKMBrown©]

Typical woodworking forum response, spell check, grammer check and math check and completely ignore the content of the post.Geez.

Your point was that Chinese don't care about the law and will cheat.. ok. I agree they cheat all the time as a matter of course. They steal IP they lie about costs they are corrupt to the bone, this is why we need to tax them and restrict their access see their telecom firms hacking our communications.

Oh and your math was off by 220% not a small amount. The equivalent of a girl saying she's 18 when she's really 8. I figured you might want to edit your story.

[Woodenfish]

Chinese tariffs will not affect me. If their prices are increasing due to tariff it’s a reminder on how bad prior government and corporate administrations have screwed the American worker. I’ll buy something else and chances are it will be better made and better for our national economy. If new tariffs on Mexican products are applied same thing. If I am not willing to purchase at that price there are alternatives. Their are so many alternatives in the woodworking realm that Chinese imports are of little importance. The only people that will suffer these tariffs are the cheating foreign governments and the brain dead American consumer. Thank God somebody is finally doing the work of the people and not the corporations who try to control us.

[mvflaim]

Your theory makes perfect sense, however ten years ago, I thought that antique hand tool prices would plummet because the old timers were dying off and there was no new young blood to fill the supply and demand gap. Boy was I wrong.

As far as the tariffs go, it may squeeze the Chinese manufacturers. If they currently sell their widget for $10, they may be forced to sell it for $8 otherwise the OEM manufacturer will go elsewhere to get the widget.

Or, you can look at it another way. If you were commissioned to build a custom coffee table for a customer and the cost of walnut you were going to use went up 25%, would you raise your price 25% to your customer? Of course not. The biggest part of your manufacturing costs would be your labor.

Not all is lost. Stanley Black & Decker is building a new plant in Texas to build Craftsman tools. https://toolguyd.com/craftsman-hand-tool...ws-052019/

[TRW]

Latest Grizzly catalog I received shows most of the tools now being made in Taiwan which I believe is not subject to tariffs.

[Handplanesandmore]

Latest Grizzly catalog I received shows most of the tools now being made in Taiwan which I believe is not subject to tariffs.

Tool or machine merchants are not dumb businessmen. When considering between importing and manufacturing locally, they will look at different least cost/most profitable options. If bringing manufacturing back is more profitable after all the manufacturing pros and cons are considered, they will sure bring it back. If not, they'll explore other options including moving to manufacturing ports that are not subject to any tariffs. As I stated before, let the "wars" play out and run their course, and we will find out if the objectives of levying the tariffs are met. To me, that is the only way to find out...everything else is speculative.

Simon

[Arlin Eastman]

Sawstop (which has much higher prices) partially to blame?

Higer end tools like Festool also report annual price increases. I sold one of my Festool cordless drills after three years of use, and it was cheaper to own and resell than to rent.

Simon

Anyone think what might cause part of the problem is how many companies were sued due to cut fingers and hands do to the operators fault.  Big money went out and they have to get it back some how.