Current USTR tariffs give Chinese manufacturers a competitive advantage over US suppliers and manufacturers, crippling US goods and resuming growth
MASON, Ohio, June 22, 2021 / PRNewswire / – Management at Outdoor Downlite, a division of Downlite, a market leader in down and feather processing and a supplier of responsibly sourced performance fillings, says the company has been unduly burdened by the current set of tariffs, and that USTR tariffs give Chinese manufacturers a competitive advantage on American manufacturers. Small businesses across America are struggling to survive. COVID is just the most recent challenge.
As reported in the Wall Street Journal on June 13 in an article by Josh zumbrun, “The Biden administration long-awaited revision of the pricing policy can’t come early enough for a Ohio bedding maker, who says he’s being pummeled by the US levies on imported Chinese feathers. Exclusions for Downlite and thousands of other US companies have expired December 31, 2020, and the U.S. Trade Representative’s office says he will not consider granting new exclusions until he completes a top-down review of tariffs on these and other Chinese imports imposed by the Trump administration. Meanwhile, no tariff has ever been imposed on many of the finished bedding products of China“
“It just helps the Chinese right now while hurting American manufacturing,” said Josh werthaiser, President of Downlite’s feathers and down division.
One of Downlite’s main raw materials was on the government ‘4A’ list which designates additional tariffs, while finished products imported from China were on another list called 4B. The 4A tariff list was finalized and implemented on September 1, 2019, while the other list 4B has never been implemented. The result has been that the raw materials needed to manufacture products in America by American workers are now subject to higher tariffs. At the same time, finished products entirely manufactured in China and imported into the United States were “never priced”. This unintended consequence continues to give finished products made in China a clear cost advantage over United States manufactured products, putting Chinese factories to work while hurting American workers. This remains a crippling challenge for US suppliers and manufacturers.
As the virus ravaged the U.S. economy, small businesses across America were already struggling to survive. Regulation and government policy have added costs and complexity at every turn. US manufacturers bowed under this pressure before COVID, and family businesses are particularly vulnerable. Downlite is one of those family businesses that is fighting for its existence.
Downlite is a family business United States-based manufacturer of high quality bedding: pillows, duvets, mattresses. With several factories and warehouses in North America and a long history of supporting American workers, Downlite employs over 400 employees in Ohio and North Carolina alone.
When the Trump administration announced tariffs on Chinese imports in 2018, a new set of challenges began. Tariffs on certain raw materials (particularly on the “Tariff List 3”) have made products made in the United States less competitive than similar products made in the United States. China.
In response to this policy, Downlite participated in United States Hearings of Trade Representatives (USTR) to explain why these raw materials should not be subject to a tariff, citing the lack of alternative sources of supply, the likely loss of national jobs and the increase in costs to the end consumer . Based on the guidance, the USTR removed these raw materials from a list 3.
The good news did not last long. In mid-2019, USTR announced “List 4”, which again included Downlite base raw materials. Downlite returned to Washington, DC, and again made its case to the USTR. This time the USTR decided not to remove these materials from the list. Worse yet, the USTR’s split listings, Listing 4A included all materials from China, when less than 75% of the total volume imported into United States native China. Consequently, the Tariff remains high for those who appear on these lists. The USTR apparently believed this would help US manufacturers. Unfortunately, this only made matters worse.
Downlite worked diligently with the current administration and the USTR to reinstate previously approved exclusions. Unfortunately, these rates remain.
Please write USTR to [email protected] or the Senate and the House to express their support for restarting the tariff exclusion process.
Installation of Downlite in the United States at Mason, Ohio