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| In this edition of the Chronicle, instead of talking about Crossroad (for the most part), let’s talk about tariffs. All our products are specified by our own small but educated team here in Indiana. To deliver the best quality products, we rely on highly skilled manufacturing partners, located all over the globe. As you know, most all countries were impacted by the Executive Orders. A few of these partners are in China, with whom we have worked for many years. We have been expecting tariffs, and we’ve made more scenarios of what could happen, but it is a complicated and moving target, sometimes changing daily and even hourly. What has taken us by surprise is that every country on the planet exporting steel and finished steel products to the US is subject to a minimum 25% tariff in addition to the duty rate, per the Section 232 ruling dated 3/12/2025. And this order was not subject to the 90-day moratorium on additional duties. Furthermore, nor were goods in transit exempted from the tariff. Does this sound fair to you? Does the 90-day moratorium help? Yes, in a way, but do we know if whatever general tariff rate on imports from any country will be in addition to the Section 232 ruling of 25%? How do you plan on the outcome of negotiations? It’s a guessing game and, frankly, lunacy. Here’s what we know now: • Wire Inserts, Lokserts & Bondserts: No increase now, but as parts come in, up to 25% increase. Any new forward order could be subject to a 25% increase, with caveat for another increase depending on result of 90-day negotiation. Having said that, if the tariff were to result in a return to today’s pricing within 60 days. COO UK, Italy, and Taiwan. • Powercoil, Loksert & Bondsert Kits: 15% increase immediately. Tap and drill COO China. If tariff reduced to Trump’s original 25% tariff, prices will be reduced to what they are today. • E-Z Chamfer: 15% immediately, COO China. If tariff reduced to Trump’s original 25% tariff, prices will be reduced to what they are today. We are working diligently, and have been, to reduce reliance on China, which is not easy. We believe what the Administration has not addressed are the realities of Section 301 tariffs and Section 232 steel orders, which encompass thousands of items that are not, and will not be, manufactured in any capacity here in the US. Hatchet approach as opposed to a scalpel. We have identified alternative suppliers but must qualify them and evaluate the tariff impact of the countries of origin. Lastly, realities for the threaded fastener industry and the country. In 2024, threaded fastener imports totaled $6.234 TRILLION! Taiwan and China led the way with 70% of that total. Do the smartest guys in the rooms of DC think that US manufacturing can absorb that capacity… if they do, they are dreaming. And how will this impact inflation as it streams through the supply chain?Thank you for your support, we are doing what we can to minimize the damage. All subject to change… |
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