
While the two-week-old Trump 2.0 administration has been a veritable firehose of activity on a range of fronts since taking office, one of the most prominent has been its willingness to use the threat of imposing tariffs on other countries to achieve its goals.
It all started last Sunday when Colombia refused to accept military flights shipping criminal illegal immigrants back to the South American country. During a round of golf, Trump announced via social media that in response, he would impose a 25% tariff on imports of Colombian products along with other measures. In less than an hour, Colombia’s president Gustavo Petro backed off and not only agreed to accept the return of the illegals but to send his plane to collect them.
Yesterday, Trump turned his tariff gun on targets much bigger and closer to home. He imposed 25% tariffs on both Canada and Mexico in efforts to force our neighbors to the north and south to do more to stop the flow of drugs, including fentanyl. across America’s borders. Despite some tough talk from both countries’ maximum leaders, by day’s end, both had caved to the pressure and agreed to take a range of steps to combat the drug flow in exchange for a 30-day pause in imposing the tariffs.
As you can probably imagine, Trump’s willingness to impose tariffs represents a significant threat to the exporting manufacturers and the economies of both countries.
For perspective, Mexico moves almost half a trillion dollars of goods north across the border each year. That represents about a quarter of the entire Mexican economy. That’s about the same dollar value that moves from north to south and makes up about 20% of Canada’s GDP. In other words, both countries have a lot at stake in doing whatever it takes to avoid the imposition of tariffs on goods headed to America.
There aren’t a lot of firearm-related companies in either country that sell their products in the Land of the Free and the Home of the Brave that would be subject to US-imposed tariffs. But American companies could be affected sales-wise as both countries, before they capitulated, had announced retaliatory tariffs on imports of US goods.
Aguila Ammunition, of course, is hecho en Mexico, though the company also has a manufacturing facility in Conroe, Texas. It isn’t clear how much of their product line that’s sold in America is produced in Texas that might be able to sidestep any tariffs.
A Canadian firearm-related company you might know — Ontario-based TriggerTech — apparently had the foresight to begin planning for what might happen under Trump 2.0 after The Orange One had campaigned openly on his intention to use that leverage in America’s national interests. In an effort to reassure their American customers, TriggerTech sent out the following email blast yesterday . . .
Tariff Update
Dear XXXXX,
You have likely been following the news over the past 48 hours with respect to that tariffs that were announced – then delayed – on Canadian and Mexican goods. While we are pleased to see that cooler heads prevailed in the near-term, we also recognize that this issue has not gone away. We wanted to take this opportunity to share an update on how we have been preparing for potential tariffs and, more importantly, what this means for you.
TriggerTech preparations:
We have been planning contingencies for months to reduce potential tariff exposure by way of internal transfer pricing, using our US-based subsidiary, and other measures; this will allow us to mitigate any tariff impacts in the near-term (e.g., if/when they are rolled out, the impact will not be +25% on prices). We have also been diligent in stocking our US warehouse with product that was already imported ahead of tariffs. We will continue to do this, and it will allow us to keep supplying you with our products without interruption if/when tariffs take effect. In short: we are prepared, and our objective is to minimize any impacts on pricing and service levels.
In the longer-term, our intent is to ensure that tariffs are not a constant concern for our US customers. We are fully committed to adapting and thriving in this evolving landscape.
Our long-term strategy has always included the ability to provide Made in USA products. In this regard, we began shifting the production of critical components to the U.S. over three years ago. Currently, the U.S. content in our most popular models is as follows:
Since tariffs are based on country of origin, we are evaluating ways to accelerate our shift to U.S. origin, which would eliminate the impact of these tariffs entirely. We are in the fortunate position that much of the groundwork has already been laid. Over the past three months, we have also made significant progress on the path to having our own U.S. manufacturing facility. While details are currently confidential, we look forward to sharing more details with you on this exciting milestone in the coming months.
So, what does this mean for you?
-
- We still intend to proceed with our original planned price increase, to take effect on March 1st. Details (including price sheets) were shared on January 17th; please reach out if you need further details or clarification; and,
- If/when tariffs do get implemented, we are prepared. Your prices will not go up by an additional 25%, and we will ensure that your margins are unchanged. Unfortunately we simply cannot know the specific impacts until a detailed plan is rolled out, but know that we have taken steps to mitigate any impacts.
We will be continuing to monitor this ongoing situation closely, and will be sending out regular updates as necessary as the situation develops.
Thank you,
TriggerTech
Trump also imposed a 10% tariff on China, from which most of the fentanyl in question originates. American firearms makers and gun owners, of course, buy a lot of products and components that originate in China including electronics and optics that go into a variety of SKUs. No deal like the ones reached yesterday with Canada and Mexico has been reached yet with Chairman Pooh. In fact, China has now announced retaliatory tariffs on US goods and launched “antitrust investigations” into Google and Nvidia and they’re threatening Intel as well. Maybe they figure they’ve already stolen all of the valuable tech and intellectual property they’ll need from the companies
In other words, China isn’t likely to be cowed nearly as easily as were our next-door neighbors. And that likely means increased costs for US manufacturers and, in turn, consumers. In short, watch this space.
Beyond luxury goods what does China import from us that would begin to touch what we import from them? China will talk tough but any firm tarriff is a critical blow to their economy and a mild annoyance (especially after bidenflation) to ours.
The tariffs on Mexico and Canada have been paused. Both caved in to Trumps demands and agreed will be doing their share to stop the illegal drugs and illegal aliens from crossing the borders. If they do not the tariffs go back into effect.
The Mexico economy would collapse in a week if the tariffs took effect.
The USA is the global hegemon. It isn’t China, and certainly is not Columbia, Mexico, or Canada. Find out.
We cannot ONLY think about increases in pricing for a short period; Fentanyl has to stop at the border, I will pay more for a secure border. Fentanyl kills weekly hourly daily, we all know people who have died, it has to stop. The CCP and the canadian and mexican governments do not care as long as they can launder $$$$.
China allows Fentanyl to flow into America for one reason –
A nation addled with addicts is a weaker nation overall, and China wants nothing more than a weakened America.
The drugs and their precursors (chemical ‘building blocks) will continue to flow…