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US-China Trade War Fears?

The Trump Administration’s recent announcement that a second -round of Chinese imports COULD BE targeted for tariffs have electronic end products squarely in their sights. While it’s not at all clear to the general public if the published list of $50 billion dollars-worth of goods (and 1,300 end-use items) will experience tariffs, it’s good to start considering other options to protect your business and customers. Optima Technology has the expertise to compete directly with China on price, delivery, and quality. We have been doing so for many years have no exposure to the risk of new tariffs through our Indian based manufacturing model.

The administration plans to apply a 25% tariff on the identified items (see link below in addition to those already implemented on steel and aluminum products), due to China’s ongoing theft of trade secrets, software, patents and other technology, according to the US Trade Representative (USTR). The industries to be effected are technology, machinery, medical equipment, aerospace, medicine, and education equipment.

While any new tariffs won’t go into effect immediately, plant of manufacture changes, tooling issues, sample approvals, and long delivery lead times should be factored into consideration before awarding new electronic assembly jobs to Chinese suppliers. Further, development of plans to transfer existing business from Chinese suppliers may also be prudent to minimize the effect of future penalties. There seems to be a growing consensus in the United States that China may not always adhere to international rules when it comes to technology trade. The main debate in the US is how to minimize the impact on American consumers while effecting change in China’s practices and to rebalance the playing field for all.

For a list of the US HTS codes published by the USTR see:
https://assets.documentcloud.org/documents/4430282/Office-of-the-United-States-Trade-Representative.pdf

To discuss how Optima can assist you with your sourcing decisions, please consider our invitation to provide quotes for any of your electronic assembly, sub-assembly or box builds, thereby decreasing your exposure to tariff penalties. Contact us via email at optima@optimatech.net