Is Car Audio on the China Tariff List?

The Trump Administration posted a list of products from China that may be subject to a 25 percent import tax.  Car radios and radar detectors may be on that list, depending on who you talk to.

For the past two days, suppliers have been trying to translate the list of electronics to fall under new tariff regulations.  The list includes:

Radar apparatus  (HTS code 85261000 )

Radio navigation aid apparatus other than radar  (HTS code 85269100)

Radio receivers (HTS code 85279915)

(See page 44 in the list here.)

Sony told us their products do not fall under the tariffs.  The custom codes for their products, (known as HTS codes as noted above) were not on the list, it said.

But Epsilon (supplier of SoundStream and PowerAcoustik) said it was informed by both its Freight Forwarder and Duty Drawback people that both radios and navigation are on the list and any products including them sourced from China are subject to a 25 percent tariff, according to Epsilon VP Sales & Marketing Paul Goldberg.

A third supplier said it looks like radios with navigation fall under the tariffs.

As for radar detectors, both ESCORT (and Cobra) and K40 said their products would be unaffected.  ESCORT and Cobra products are produced either in the Philippines or in the US so are not subject to the China tariffs.

K40’s Rachel Clark said “The proposed 25% tariff by the Office of the United States Trade Representative on product originating in China is certainly a development every U.S. manufacturer should familiarize themselves with. From the published list of classified products potentially affected by this proposal, components used to manufacture radar and laser systems – could be affected if this tariff goes into effect. Fortunately for K40 Electronics, our products, including their individual components, do not originate in China so this proposal does not affect K40 or its business partners in any way.”

Andy Wehmeyer , founder of Audiofrog who has 25 years’ experience with sourcing electronics products from around the globe said one of the problems with the tariffs is that they include electronics parts that a small US manufacturer would use in production.  Even US manufacturers use some overseas parts, such as copper wire from China which is one of the products to fall under the tariff.  This might actually cause a small US manufacturer to raise his prices or go out of business.

We asked Hybrid Audio how the tariffs would impact the company.  Founder Scott Buwalda said, “Upon an initial and non-exhaustive review of the Trump China Trade Targets, Hybrid Audio Technologies doesn’t seem to be affected in finished goods falling in the 8518XX HTS categories.  As far as unfinished goods, such as raw materials and metallurgy products, we are not quite sure the impact yet.”

Meanwhile, Trump appeared Thursday to be backing away from implementing the tariffs, which are due to go into effect in 60 days.  The New York Times reported that the Trump administration said the tariffs were subject to negotiation, as it sought to calm a stock market that was jittery over fears of a trade war with China.

Also, the exact products to fall under the program may also change, as the Fed is taking comments from the public and businesses and may respond accordingly.

The Consumer Technology Association was not happy with the tariffs, which heavily targeted televisions, computers and electronics parts.  It issued a statement saying:

“Not only do the proposed tariffs apply to finished TVs, they would also apply to many of the sub-assemblies and printed circuit boards that go into TVs and other electronic products. Unfortunately, if enacted, these tariffs would apply at virtually every level of the value chain. For example, capacitors and resistors are some of the fundamental building blocks necessary to deliver and regulate the flow of electricity in consumer electronics products. A typical computer motherboard, for example, can have dozens, if not hundreds, of capacitors and resistors on board, so a 25 percent increase in such low-level components could have tremendous downstream effects on price, ultimately hitting American consumers right in the wallet. Further still, Lithium-ion batteries are the battery of choice for many, if not most, consumer electronics devices. Tariffs on these batteries/cells also could increase pricing by the 25 percent or more on products incorporating these inputs.”

Photo: Iamdanw