U.S. boat manufacturer faces higher ‘Made-in-China’ prices

Global Business

From September 24, $200 billion worth of Chinese goods entering America will be subject to a new 10 percent tariff. That will rise to 25 percent in January. And the White House has signaled it’s ready to impose even more import duties. If it does, Washington will be taxing an amount roughly equivalent to all Chinese goods shipped to the U.S. last year.

One American company that relies almost exclusively on China to manufacture its inflatable boats now has a sinking feeling about its ability to survive. CGTN’s Nick Harper reports from Port Jefferson, New York.

American company Sea Eagle has managed to keep its head above water for more than 50 years. But the latest set of tariffs is threatening to sink this family-run business.

“It will certainly cost us jobs,” says the company’s Vice President, John Hoge. “Almost everything we sell is on that list now and it’s simply going to mean that we’re going to have, we calculated, $1.1 million in extra taxes in 2019. It would be a massive tax increase on our products.”

The U.S. administration has placed almost 6,000 products on the latest list. But two categories in particular concern the company: ‘inflatable boats’ and ‘boat parts’.

Sea Eagle is a American company. But nearly all of the 30 inflatable boats and kayaks it designs and sells are made in China. And that means additional tariffs for all those good brought into America. From Monday they’ll have an added tax of 10 percent, rising to 25 percent in January. The company says it will have to pass that cost on to its customers.

“It’s quite stressful for me as well as the other employees in the company,” Dan Dejkunchorn explains. He has worked for the company for eight years. He’s a keen fisherman and feels the tariffs will impact all aspects of his life, as well as the wider angling community.

“Our lifestyles and livings depend on this. And that’s just one side of it,” says Dejkunchorn. “I’m a born and bred waterman, so my relief comes from the water, and if I can’t be on the water I’m no good to anybody.”

Over the years, Sea Eagle has managed to weather the storms of economic downturns and even recessions. Despite the tariffs it’s hoping that it will still be able to stay afloat.

The company’s lifejackets could help with that. They are not threatened by tariffs. At least not yet. The problem is that they too are made in China. The company fears they will be included in the next U.S. list of tariffs threatened by Donald Trump, totaling $267 billion of Chinese goods.

“If the price of safety equipment goes up people are going to buy less of it,” warns Vice President John Hoge. “People are maybe going to look at the lifejacket that has been around for a few years and needs replacing and decide not to.

Sea Eagle now hopes the profitability of this lifesaving product – for both the company, and its customers – will be enough to stop the company from going under.