WASHINGTON (BRAIN) — The U.S. Trade Representative has extended its tariff exclusions for some China-made bicycle products until Dec. 31.
The products affected include children's bikes and some electric bikes; PeopleForBikes estimates that the extension will apply to products with an import value of more than $100 million, meaning the exclusion from the 25% tariff will save the industry more than $25 million.
The Section 301 tariffs of 25% were to be applied in addition to pre-existing tariffs on China-made bikes. The exclusions began in March 2022 and have been extended previously. The current extension was due to expire on Sept. 30.
"This announcement adds to a series of positive results thanks to a concerted and ongoing effort by PeopleForBikes and the bike industry to obtain relief from Section 301 tariffs," PeopleForBikes said.
"Any increase in tariffs now would be dire for a large sector of the U.S. bicycle industry" — PeopleForBikes letter to the USTR
Matt Moore, the organization's general and policy counsel, sent a letter to U.S. Trade Representative Katherine Tai in August, urging her office to extend the exclusions.
Moore told Tai that the industry is challenged by current economic and market conditions and that an increase in tariff payments would be especially "dire." He noted recent layoffs across the industry.
"While ridership in the United States continues to grow, a majority of bicycle companies remain anxious about the economy and the excess of inventory resulting from pandemic-related supply chain delays," Moore wrote.
"At the same time as the supply chain normalized, sales of new bicycles and bicycle products began to decline and are now at or below 2019 levels. Interest rates on business loans have spiked dramatically due to rate hikes by the Federal Reserve and credit is increasingly hard to obtain. As a result of this triple threat from excess inventory, declining sales, and increased cost of capital, many companies in our industry are struggling with cash flow and are being forced to lay off workers to control expenses," he continued.
"The bottom line: any increase in tariffs now would be dire for a large sector of the U.S. bicycle industry," Moore wrote.
