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July 31, 2014

Tariffs and higher prices may be inevitable

The tariffs are coming. With them will be an increase in tire prices.

That seems to be the way the winds are blowing, following early decisions by the United States International Trade Commission and the U.S. Department of Commerce. At the very least, Modern Tire Dealer Editor Bob Ulrich, who is against the tariffs, is not optimistic.

"The result will be increased tire prices," he says. "If tire manufacturers don't eat at least some of the increase, will tire dealers be able to pass it along to their tire customers? I don't think so."

Find out how high the tariffs might go and why by reading Ulrich's latest blog, "Tariff update: Can you afford to raise tire prices by 88% just to break even?"

Do you agree or disagree with Ulrich? Do you want tire prices to go up? Let us know what you think by leaving a comment!

Related Topics: B.O.B., DOC, ITC, Tire pricing, tire tariffs

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  1. Darrel | July 31, 2014 at 09:39AM
    If the tariff is imposed on foreign tires only I don't have a problem with it. It might help level the playing field a little. I prefer to sell an american product and the inexpensive[cheap] foreign tires make that difficult.

  2. Dan | July 31, 2014 at 10:27AM
    The last tariff tells the whole tale. When the tariff is imposed all the other manufactures will follow suite and it will be a catastrophe. The unions have absolutely no place any more in the country and the will destroy it. This is all greed, it seems this country has not leaned its lesson. China helped to bail us out and this is how we repay them.

  3. Jim | July 31, 2014 at 10:31AM
    If a tariff is put on ALL IMPORTED TIRES and not just on those that are made in China, then that would be fair.

  4. Jason | July 31, 2014 at 10:39AM
    I prefer to sell American made tires as well. But what's going to keep American companies from raising the prices on their tires like they did the last time. Also there is only two solely owned American companies left.

  5. Ricardo | July 31, 2014 at 10:45AM
    I am personally against the tariffs, but I own a retread plant. Last time new tires went sky high my customers were calling left and right for retreads. So I would say the tariffs will benefit those of us in the retread industry.

  6. Mark | July 31, 2014 at 11:19AM
    As with the last tariff, many manufactures moved their manufacturing outside of China. The only fair way to play it would be to include all foreign made tires.Imposing the tariff will definitely result in higher prices on domestically produced tires as well. An American company that produces entry level products will simply not market their products for the same price as a product made in China, Indonesia, Taiwan etc.The American public is ultimately the one who will pay for it. Time for the Unions and political paybacks to take hike!

  7. ARTHUR | July 31, 2014 at 11:26AM
    I TOO SAY MAKE TIRES HERE IN THE STATES AND GET RID OF CHINA WAS AND FOR ALL!!! #1 THEY R INFERRIOR PRODUCT WITH BAD REP.LIKE TO BE ABLE TO BE PROUD OF THE USA LABEL AND SELL AMERICAN FOR THE AMERICANS

  8. DONALD | July 31, 2014 at 11:53AM
    AS IN THE PAST THE TARIFF WILL MOST LIKELY LIMIT CHINESE IMPORTS TO THE U.S. BUT WILL INCREASE OTHER FOREIGN IMPORTS TO THE U.S. WHY ONLY TIRES. WALK THRU COSTCO AND WALMART STORES AND TRY AND FIND PRODUCTS THAT ARE MADE IN THE U.S. WHERE WAS THE DEPARTMENT OF COMMERCE WHEN THEY ALLOWED THE TEXTILE BUSINESS AND SHOE BUSINESS AMONG OTHERS TO BE DESTROYED. ONCE THE TARIFFS ARE REMOVED, THE IMPORTS WILL STILL BE THERE, BUT FROM OTHER COUNTRIES. IN THE END THE CONSUMER WILL PAY FOR THE POLITICAL FOOLISHNESS THAT IS ALMOST A CERTAINTY TO TAKE PLACE AS THE PRESENT ADMINISTRATION PANDERS TO THE UNIONS.

  9. Kevin | July 31, 2014 at 12:03PM
    Imposing a tariff (tax) on imported tires hurts everyone except union employees and then only short term. The tariff is a price fix to the marketplace which results in manufacturers(entrepreneurs) being thwarted in their attempts to discover costs in the higher stages of production. Consumer demand will taper, inventories will rise and manufacturing layoffs occur. Not a pleasant forecast when free markets are tampered with.

  10. Joseph | July 31, 2014 at 12:42PM
    If the price increases come heavy on all world-wide made tires (which it will)... more consumers will seek out used tires and/or run their existing tires to wear stages of danger relating to safety. Thus, more resulting accidents, injuries and deaths. Short of that...more people struggling to be able to buy tires.

  11. russ | August 01, 2014 at 06:25AM
    I have read some of the responses and you are all missing the boat. When tarrifs are added to import tires, American made goods will go up as well, just below the cost of the import. All American tire manufacturers will take advantage of this to line their own pockets. "Its the American way."

  12. DONALD | August 01, 2014 at 01:09PM
    YOU CAN BE SURE OF ONE THING FOR CERTAIN. WHEN THE TARIFF GOES INTO EFFECT ALL OF THE FOREIGN MANUFACTURERS WILL RAISE THEIR PRICES IN LINE WITH THE PRICES THAT THE CHINESE MANUFACTURERS WILL NOW CHARGE. EXTRA PROFITS FOR THE OTHER FOREIGN MANUFACTURERS WILL NOT DUE A THING FOR THE AMERICAN ECONOMY. HOW LONG WILL THE POLITICIANS SELL OUT TO THE UNIONS AT THE EXPENSE OF THE AMERICAN PUBLIC

  13. TireGuy | August 03, 2014 at 04:00PM
    David | August 01, 2014 at 07:13AM

    Where is it written that the prices must rise on non-Chinese produced tires? Well it is written in the laws of economics for one. Who would sell a product at the same old price if all of their competitors prices went up 86%? There are too many good, even average pricing managers at companies who will see this as an opportunity for profit. Get serious, you really think that Michelin will want only a ten or twelve dollar spread between its premium offering and a Ling-Long?...

    Tire | August 01, 2014 at 12:19PM

    RE: Michael, you hit the nail on the head. The circumstances are much different this time. Natural rubber prices are stable, supply is stronger and crude oil prices are dropping because of a slowing ASIAN economy already. So already, we're seeing a benefit in our gas prices because shipping from Asia/China has slowed. (This includes Russia obviously for the geographically challenged.) Lastly, I'm tired of retailers crying about how it will hurt business etc. Train your staff to qualify a customer, explain the feature and benefits of every tire you sell and quit assuming everyone wants the cheapest thing. Saying "I want something cheap" doesn't mean I want cheap tires. Cheap to Donald Trump and myself are two completely different spectrums but YOU would offers us both some no name tire from China that you got at a deal and then hesitate in your sales presentation because you think it's high. Quit complaining and focus on training. Blame yourselves for all this mess. You created this monster. Oh....and P.S. Rubber prices have been falling in recent days too. GO FIGURE!!

  14. Tire | August 03, 2014 at 04:15PM
    Donald, can you tell who isn't a Foreign Manufacturer? EVERY COMPANY is a foreign manufacturer. Including Cooper! "Foreign companies" like Continental (German), Michelin (French), Toyo/Nitto (Japan) do more business in the U.S than the "American Owned" Cooper Tire; they produce most of their product in China under other names. GET A CLUE! You guys are all loosing track of the point here; we need to do things to keep our economy stronger and work with allied countries in the least and not those that threaten our very safety. Glad you'd rather support the Chinese; why don't you just move there and voice your opinion on anything and see where that gets you. Kevin, are you saying you'd prefer those union jobs be lost and sent to China? because that's exactly what would occur in the next few years at the rate that we're importing everything from China. Way to show your stars and stripes.

  15. Realist | August 03, 2014 at 04:23PM
    Higher quality products should cost more. Learn to sell. I will thrive in this because my employees are great at selling regardless of costs and all of you sitting around crying over spilled milk will be gone and I'll have less people to compete with when the tariff expires.

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