Finished TVs From China Spared From New Tariffs, but LCD Panels Take Hit
Tech interests will debate the ripple-effect consumer harms that may result from the Trump administration’s newest proposals to impose 10 percent Section 301 tariffs on $200 billion worth of Chinese imports. But the list of goods targeted for the 10 percent duties, released July 10 in an Office of the U.S. Trade Representative notice, doesn't include meaningful end-user consumer tech products like TVs.
Sign up for a free preview to unlock the rest of this article
Export Compliance Daily combines U.S. export control news, foreign border import regulation and policy developments into a single daily information service that reliably informs its trade professional readers about important current issues affecting their operations.
Of the roughly half-dozen product codes listed in the notice under the Harmonized Tariff Schedule’s 8528.72.00 family of classifications for finished TVs from China, virtually all are of the non-HD variety and have built-in legacy CRT screens. Shipments of those products to the U.S. were minuscule last year from most countries of origin, including China, said Bob O’Brien, president of Display Supply Chain Consultants, citing International Trade Commission data. The proposed list deals a potential blow to Element Electronics and any other entity with ambitions to assemble LCD TVs in the U.S. using flat-panels sourced from China. USTR added two classifications of flat-panels (HTS 8529.90.54 and 9013.80.90) to the target list for the first time.
Element fought hard in mid-May hearings on the first round of tariffs to keep flat panels from China off the list and finished TVs on it (see 1805150044), but it lost on both counts with the release of the new list and USTR’s decision to exclude finished TVs from the tariffs it announced June 15 (see 1806150003). “We see no possibility that Element could continue to assemble TVs in South Carolina if the 25% duty is imposed on LCD panels,” the company told USTR in May 22 post-hearing comments. Element is “currently studying this issue with our advisors" and won't "have any comment at this point,” General Counsel David Baer said in an email.
O’Brien also thinks Foxconn “is a complete loser in this,” until it gets its LCD fabrication “up and running” in Wisconsin, which won’t be for another two to three years, he said. “Their plan, as I understood it, was that they were going to start by building TVs with imported panels” from China, he said. “This throws a wrench in that,” though it’s possible Foxconn “could source panels from Taiwan or Japan," he said. Foxconn representatives didn’t comment.