This move creates uncertainty for equipment manufacturers, an organization says
President Trump is moving forward with tariffs on all steel and aluminum imports.
The president signed an executive order on Feb. 10 to restore a 25 percent tariff on steel and raise the tariff on aluminum from 10 percent to 25 percent.
The tariffs are scheduled to go into effect on March 12, and the U.S. will not exempt any countries from these levies because they benefit China.
“By granting exemptions to certain countries, the United States inadvertently created loopholes that were exploited by China and others with excess steel and aluminum capacity, undermining the purpose of these exemptions,” a factsheet says.
An organization representing equipment manufacturers is concerned about the implications of these tariffs.
This includes rising costs and retaliation, the Association of Equipment Manufacturers (AEM) said.
“This round of tariffs, and the retaliatory tariffs that will follow, will raise the price of steel and aluminum domestically and drive up the cost of manufacturing equipment in America,” AEM President Kip Eideberg said in a statement.
The last time tariffs were on aluminum and steel, the cost of producing equipment increased by about 7 percent, the statement says.
The Producer Price Index (PPI) for ag machinery and equipment has been on the rise since about June 2018.
As of December 2024, the PPI is up about 32 percent overall.
And any additional increases in production costs will be passed down to the consumer.
Prior to the president’s decision on Feb. 10, a CNH representative said as much.
“Whatever will hit us on the cost side will be priced to our customers,” Gerrit Marx, the CEO of CNH, said during a quarterly earnings call, The Wall Street Journal reported, adding that the company may relocate some production to reduce the impacts of tariffs.
China is already retaliating against the U.S.
In response to President Trump’s previous announcement of a 10 percent tariff on all Chinese goods, China is putting its own tariffs of between 10 and 15 percent on American goods like farm machinery, coal, pickup trucks and natural gas.
President Trump originally included Mexico and Canada in that tariff announcement.
Each country was facing a 25 percent tariff but have been granted a 30-day reprieve that ends on March 4.