President Trump’s proposed tariffs continue to be a hot topic, not only with the steel and aluminum industries, but with manufacturers of various electrical products as well. Just this month, LEDs and LED parts were added to the growing list of Chinese products subject to tariffs. With the possibility of imported LED products going up in price, does that mean “Made in the USA” LEDs will rise as well?
Just last week we featured lighting manufacturers and their thoughts on how the tariffs would affect the industry. While those manufacturers are not predicting big changes when it comes to LEDs, both of the corporations we interviewed agreed the market is volatile.
But what about the distributors? As the next layer in the “trickle-down” effect, are they concerned? Like the manufacturers, they call the market volatile.
Rhandi Kuchenmeister, Purchasing Agent at K/E Electric Supply, says, “Simply put, we don’t know now to what extent the industry will be affected by the tariffs. Almost every manufacturer has announced or already implemented a series of price increases across all sectors – commodities, shelf goods, lighting… everything.”
Brian Rooney, Branch Manager at Crescent Electric Supply, agrees that the prices will increase, but he is convinced it will not be catastrophic. Rooney thinks LEDs will see less of an increase, whereas lighting fixtures themselves may take a hit. He doesn’t see the lighting industry as a whole being affected the way a commodity type business will be.
While Kuchenmeister says that the effects of the tariffs are uncertain, he does believe that this will help domestically manufactured inventory. “‘Made in the USA’ products will be on a more level playing field with imported goods, but we will still need imported materials. There just isn’t the supply of raw materials available domestically to match the demand.”
Even though LED prices have dropped in the past few years, don’t expect it to last. Both distributors expect prices to climb, at least a little, and both are getting ahead of the potential increase.
Distributors who plan to increase LED and lighting product prices should examine their plans in regards to the tariffs, and be sure to keep their customers in the loop. Rooney’s advice? “The best thing you can do in times of uncertainty is to give the maximum amount of information and transparency so people can make informed decisions.”Tagged with distributors, economy, LED, tariffs