Hisense Says It Can’t ‘Foresee’ Making Products in US Without ‘Lengthy Disruption in Supply’
Hisense USA wants 11 categories of TVs, audio products and appliances removed from the proposed List 4 Section 301 tariffs on Chinese imports because duties on those items would have “a disproportionate impact on individual consumers,” commented the company in docket USTR-2019-0004. “We have no option but to import these items, and the predominant source is China,” said Hisense.
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.
The company finds it "difficult to imagine that other countries would be able to replace China as a supplier of these items, at least within a year’s time," it said. It's also "difficult to foresee Hisense manufacturing these products in the United States without a lengthy disruption in supply,” it said.
If the Trump administration makes good its threat to impose the List 4 tariffs on Hisense products, “absolutely no U.S. manufacturers would benefit from the additional market protection,” said the company. “Instead, the additional duties would ultimately reduce competition for the products, which in turn would raise prices for American consumers and homeowners.”
Hisense “obtained the licensing rights for the Sharp TV brand” four years ago, and “markets its TV products under the Sharp name as well as under the Hisense brand,” it said. Japan-based Sharp last month signed a memorandum of understanding with Hisense that will result in the “early transition of the Sharp TV brand back to Sharp,” said the U.S.-based Sharp Home Electronics marketing and sales subsidiary (see 1905100067).
The threat that List 4 tariffs could be imposed on nearly all remaining imports from China "has already accelerated a scramble among importers to find alternative sources of supply," said the National Retail Federation. "While the administration may think this is a good way to exert pressure on China, it is coming at a very high domestic cost."
This "scramble" is already "bidding up prices for these goods from all possible alternative manufacturers," said NRF. As a result, higher prices, "regardless of the outcome" of the List 4 proceeding and which products will be tariffed, "are already on the horizon for American families," it said. "This problem is particularly acute for products sold by small retailers across the country that have little control over their supply chains."
NRF finds it "imperative that tariffs not be imposed" on the consumer goods proposed in List 4, "especially at this time, in order to secure supply and ensure our customers can enjoy the holidays free of the burden of new taxes," said the group. "Retailers are making their purchasing decisions anywhere from six to 12 months in advance," said NRF. "Making changes today to reflect the imposition of new tariffs would not be possible to affect those deliveries." Goods already ordered for the holiday selling season "will have to bear the added costs of the tariffs," said NRF.