Tariff Update

[marshg246]

Most know that tariffs to the US have been confusing for the last year or so. Officially, all shipments to the US have tariffs but according to the official Govt site, https://hts.usitc.gov/ our parts do not have any (HSS code 8714.10.0050). Then there's "de minimis" (too little to care about). The de minimis amount to the US is $800. This meant that shipments under $800 were tariff (duty) free.

Then executive orders were signed that supposedly did away with de minimis. They actually only did away with it for certain countries like China.

There is a new executive order that suspends it for all: https://www.whitehouse.gov/presiden...-free-de-minimis-treatment-for-all-countries/ It is effective at midnight tonight.

It has special provisions for international postal but in general causes all shipments to have tariffs.

Australia Post has announced no more shipments to the US. I suspect that others will follow.

So, in the case of Tri-Spark, it will be expensive to buy one unit as it will have to go through FedEx, DHL, etc and will have a tariff (I'm guessing 10% but don't know) and of course, they tack on a "handling fee". For now, Tri-Spark is planning to tell US customers to talk to a dealer. One problem is that dealers have had to make small orders to stay under de minimis. For instance, I placed three orders of six ignitions this month to stay under de minimis and to use Australia Post which is MUCH less than FedEx. The first order of six is already sold out and the other two are on the way.

 

[Tornado]

Its good to see them protecting the US vintage brit bike EI industry!

 

[Richard Tool]

Royal Mail has also suspended shipping to USA .

 

[ntst8]

NZ Post too.

 

[marshg246]

And once my incoming orders are in, I doubt that I'll get more stock from AN. The shipping increases and tariffs are greater than my discount so it makes no sense to buy for resale and the $70k of AN stock I have will soon be even less expensive to US customers as those prices are set (no tariffs paid and the lowest shipping I could get).

AMAL, Tri-Spark, RGM, and Wassell all have true dealer accounts so I may be able to continue with them.

The postal systems are shutting down because they have no systems to handle the tariffs. DHL, FedEx, UPS, et. Al. are the winner in all this. Besides they'll get increases traffic and they charge fees to "handle it" for you. DHL charges the tariff plus $17.00 (last I checked). There is no actual extra work, it's all computerized. FedEx charges more, charges a storage fee for every day you don't pay, and has no dispute email/phone. UPS is the better of the three and you can complain to customer service but that's a crap shoot.

 

[hybridracer]

It is successful then, no imports and you all buy home grown beans.

 

[marshg246]

As of 7 hours ago, the count was over 30 countries, and it appears:

1) DHL has also stopped. I'm guessing due to their relationship with Deutsche Post
2) UPS is still shipping but they have gotten way more expensive recently.
2) FedEx is still shipping but may not from all countries as they rely on "last mile" postal services in some.

 

[marshg246]

It is successful then, no imports and you all buy home grown beans.

Story time:

In the 80s I had a thriving computer company where I built and sold IBM compatible computers to corporations, schools, and sometimes individuals. At the time, almost all memory chips came from Japan and none from the US. Many chips were required for each computer, and they were a significant cost of the computer.

Then in April 1987 a 100% tariff was imposed on Japan's semiconductors (mostly memory chips). My thriving business ended in May 1987 as the computers increased in cost to me and I could no longer build them for the agreed selling price - fortunately the buyers did not come after me for breach of contract.

Did the tariff work? Zero US companies started making memory chips. AFAIK, Japan does not either now. The big makers are Taiwan, South Korea, and China.

To say I'm not a fan of tariffs is quite the understatement. I wish all countries would end them! Then no one would think they are being unfairly treated.

 

[marshg246]

I just put a few items in my AN cart that I actually need and here's what it works out to:

$47.99 Parts
$26.52 UPS Shipping (very light order, would have been MUCH less with Royal Mail before today).
$ 7.45 10% Duty (guessing)
$17.00 "Handling Fee" I don't know the UPS fee but since DHL is $17 I'm guessing UPS is too.
-------
$98.96
$ 2.97 Bank Foreign Transaction Fee
-------
$101.93

So parts times 212% - I don't need them that bad.

 

[jan nelder]

I just put a few items in my AN cart that I actually need and here's what it works out to:

$47.99 Parts
$26.52 UPS Shipping (very light order, would have been MUCH less with Royal Mail before today).
$ 7.45 10% Duty (guessing)
$17.00 "Handling Fee" I don't know the UPS fee but since DHL is $17 I'm guessing UPS is too.
-------
$98.96
$ 2.97 Bank Foreign Transaction Fee
-------
$101.93

So parts times 212% - I don't need them that bad.

latest BBC post on the subject:
1. As of today, 10% tariff will ALSO now apply to packages below $800 value( a new Trump directive.)
2. National post offices in many countries had already suspended services due to confusion over what the USA rules are.
3. Other couriers have already added fees due to more admin.

 

[concours]

Story time:

In the 80s I had a thriving computer company where I built and sold IBM compatible computers to corporations, schools, and sometimes individuals. At the time, almost all memory chips came from Japan and none from the US. Many chips were required for each computer, and they were a significant cost of the computer.

Then in April 1987 a 100% tariff was imposed on Japan's semiconductors (mostly memory chips). My thriving business ended in May 1987 as the computers increased in cost to me and I could no longer build them for the agreed selling price - fortunately the buyers did not come after me for breach of contract.

Did the tariff work? Zero US companies started making memory chips. AFAIK, Japan does not either now. The big makers are Taiwan, South Korea, and China.

To say I'm not a fan of tariffs is quite the understatement. I wish all countries would end them! Then no one would think they are being unfairly treated.

I worked in Colorado Springs, CO chip factories installing machinery we had built in Massachusetts, circa early 90's.

 

[robs ss]

Nobbling the opposition seems more likely to make your people "fat & lazy" than "lean & clever"
Hang on though... I've seen some of those Walmart videos.

 

[grandpaul]

"This too, shall pass"

 

[jan nelder]

"This too, shall pass"

hopefully without added 10%…..

 

[Madnorton]

To clarify, AN and it's couriers have had systems in place to cope with tariffs and duty for many years, it is the US system which didn't until now. These were needed post brexit and for countries like Australia and NZ that have used it for many years and AN seamlessly integrate with.

It is the flat rate 'duty' charge (not tariff) that the US have introduced on the box, not the contents which is causing shippers to stop shipping to the US. Details in the White House paper. The rate is not dependent on contents or value but where the parcel is sent from. Minimum rate is $80, in addition to tariff, handling charge, tax etc.

Hopefully this mess will be short lived.

 

[Madnorton]

Remember import is not the same as the system introduced under the suspension of de minimis to capture low value parcels. Imports will continue just with different tariff rates.

 

[marshg246]

OK, probably the final horror story.

I placed an order with AN while there was still no tariff when the order was less than $800 - the order was about $733 (depending on exchange rate). They shipped right away via DHL. DHL sent a bill for $78 for duties plus their $17 fee. I immediately disputed it. That normally takes around 5 days and the shipment is held while they work the dispute. I got notice that the duties and fee were removed, but DHL had already sent it back to AN.

AN told them to try again and DHL again asked for $78. I still had the open dispute so I informed DHL. They went in circles saying it wasn't sent again even though forwarded them tracking and the new duty demand.

DHL again returned it to AN.

So I agreed to take the screwing, and have it sent UPS so the people waiting for parts would not be disappointed.

Duties are now required but since the US Govt still shows no duties for 8714.10.0050 I have no idea how much.

Today I got a bill from UPS for $398 with absolutely no accounting of what it is for other than saying is for a shipment from AN. I've now been on the phone listening to music for over two hours trying to find out what $398 covers.

For those waiting for parts - not sure you will get them. If you do, I will honor the price I gave you. For those considering ordering parts, I have over $70k of AN parts in stock including the Old Britts inventory I bought out - I am unlikely to replenish any parts so get them while they are still inexpensive.

FYI, when I'm lucky, I "make" 3-5% on parts and that's not accounting for the time it takes to get parts, shipping materials, bank fees, taxes, and shipping them - in truth, I lose money on every sale. I make more money in my IT business in an hour than I make on parts in a month. This is not a sustainable business.

The UPS customs dept just closed at 6pm so their phone hung up on me without a human ever answering.

 

[Madnorton]

Today I'll email some customers who have ordered on the 1st and 2nd, and find out if they have had any issues.
To give an idea of how hard it is I am trying to get $12 of parts to a supplier in the USA and despite the fact these would fit in an envelope in the palm of your hand it is looking nigh on impossible to send them using our contract couriers. Guess what, if they don't get the parts then they will park the project - so much for the rest of the world using US suppliers.

 

[Madnorton]

We are trying to set up a tariff system with our couriers, this not active yet as UPS and others are still setting it up on their systems. In the meantime it is looking like demands for parcels arriving at the US border will be around 70 - to over 100% of the value of the contents. Higher value shipments which are classed as imports seem to be arriving trouble free.

 

[acotrel]

I worked in the Australian Customs Department when we had tariff protection for Australian industries. To change a tariff required a Tariff Inquiry, which was often complex. I also worked in the Department of Defence when Bob Hawke started removing tariffs and subsidies. Many Australian companies were always going to go under without government help. Now that most of our engineering companies have gone, removing tariffs would not bring them back. Skills continuity is important. Most of the Chinese products are better than Australian-made ever were.