President Donald Trump plans to impose a 25% additional tariff on more Chinese products, which include MacBooks, iPhones, and coffee brewers. Consumers will also be directly affected, but what do the companies have to say?
As expected, companies like Keurig Dr. Pepper Inc., Dollar Tree Inc., Fitbit Inc., and Apple Inc., have expressed their refusal and dissent regarding the United States President’s proposal on tariffs.
A meeting between leaders will take place at the G20 summit in Japan in an attempt to pursue ending trade wars between China and the U.S. After a hiatus, U.S. President Donald Trump stated his desire to add tariffs on top of the $300 billion regarding Chinese products. That is if the discussion with Chinese President Xi Jinping doesn’t show any progress or forward movement.
According to the letter written by Apple Inc., implementation of extending tariffs would lessen the company’s competency in the market, as well as lower the contribution in the United States Treasury. Furthermore, Apple states in the document its status as the most significant taxpayer in terms of the United States corporate field. They restated their $350 billion pledge last 2018, that they would contribute to the U.S. economy for five years.
It gives global competitors more advantage, Apple said. Tariffs would significantly “tilt the playing field” and affect the market because of the presence of other firms.
Some of the Apple products to have additional taxes would be AirPods, Apple TV, Apple batteries, and different parts as well. The products mentioned have initially been not part of the inventory of products with imposed tariffs. Last September, already $200 billion worth of goods had taxes.
There is a 7-day hearing for the current issue in the U.S market. Manufacturers and companies alike will be allowed to voice out their concerns, as well as weigh in on President Trump’s plan on additional levies for products. Within the period, filed letters will also be addressed by the U.S Trade Representatives regarding their comments.
On another note, aside from Apple Inc., other companies and brands refuse to or oppose the U.S President’s proposition such as Dell Technologies Inc., HP Inc., and Walmart Inc.
A leading producer and distributor of hot and cold beverages, Keurig Dr. Pepper (along with Apple Inc.) are one of the most recent companies to join the list that is trying to convince the government to eliminate any plans of tariff imposition. If the Trump administration refuses to hear these companies out, there is a possibility of a 25% increase on the $300 billion worth of Chinese goods.
Carrier Inc., a manufacturer of air conditioners and a part of the United Technologies Corp., stated that an increase in levies would significantly affect American consumers due to the rise of HVAC apparatus prices as well. This action would make customers less inclined to have old units and systems fixed. The company explained that trying to look for other replacement parts may take at least twelve to eighteen months, with higher prices. Costs would eventually force and remove low-priced segments to from the company’s market.
FitBit Inc., a producer of wearable devices, wrote a letter saying that added tariffs will give other Chinese competitors an edge over most in the market. There will be security problems because increasing levies place confidential information (such as health, financial data, and location) in the Chinese government’s hands. In addition to this, FitBit’s rivals are more than willing to do just about anything to earn a place in the market and have shares, which is something the company cannot afford.
Overall, statistics show a whopping 88% in bringing in coffee brewers from China into the United States. Keurig Dr. Pepper brings service to almost twenty-eight million houses and one million hotel rooms across the country as well.
According to the company, increasing the tariffs for imported products is a big step that would eventually affect the coffee-loving customers because of the expensive costs. Higher taxes also mean higher prices to be able to pay for the additional import costs. Who would want to spend so much on a usually cheap morning luxury like coffee?