Tucson bike shop is already feeling the effects of new rates

These new tariffs could cost the average American a thousand dollars a year

TUCSON, Ariz. (KOLD News 13) – The United States and China have made their latest tariff increases on each other’s goods, potentially raising the prices Americans pay for certain apparel, footwear, sporting goods and more. consumer items.

US taxes of 15% apply to approximately $112 billion of Chinese imports.

Knowing this was coming, companies started preparing months in advance.

“Six months ago we were told to get what you can.” Steve Morganstern is the owner of Bicycle Ranch on Oracle near Ina in Tucson. He has been cycling since the age of 11 and has owned the store for over 6 years.

Now, over the past year, he has had to shift gears with his strategy for running his business.

“Last year, when the first initial pricing came out, bike manufacturers and accessories were all hit, Morganstern said.

Everything you will find in his shop was from the two main manufacturers in China or Taiwan. Which means it’s all more expensive now. The new 15% tariff applied today to Chinese imports affects helmets, inner tubes and the bike itself.

“This year we’re definitely seeing instead of a $150 to $200 increase on the same bike, we’re potentially seeing a $400 increase.”

The new price hike is why Steve took a risk, ordering more bikes than he had last week. He said manufacturers sent an email advising stores like his to buy now before the tariffs took effect.

But where he can save money, he also takes a risk.

“If we bring in bikes that are the wrong size and the wrong color of what somebody wants…so we’ve definitely exposed a bigger risk to hopefully reduce some of that cost in the long run. term.” said Morganstern.

But by dodging the tariff, he still swallowed another cost: shipping. Since stores like his all have the same idea of ​​buying now and there are only a limited number of ships to bring the supplies.

Morganstern can only delay paying a higher price for so long.

“We have bikes coming in now that are under the lower price because when we go to do another big fill around Christmas at this time of year, they will definitely be more expensive.”

Morganstern said some people might put off shopping or think twice altogether, calling cycling an industry based on want, not need. But he said luckily a few of their brands they sell give them more bang for their buck, so in some areas they can still offer a reasonable price.

He also said the business model for buying a bike has changed due to tariffs.

“The business has gone from trading like cars to buying a computer where the price is the price. People aren’t quite prepared for that. And the business model has changed because of things like online sales and pricing.So it’s all about re-educating the customer that you have to pay what the price is.

For now, there is no choice for Steve but to keep moving forward. “We just have to take it out and face what it is.”

As he and his family endure the effects of a trade war, pray it doesn’t derail what he spent years building.

“It’s a family affair, a family business. Everyone is in it and it took a lot of years to figure out what I wanted to do when I grew up and I don’t think there’s a second option,” Morganstern said.

The US Trade Representative has released a list of everything that will be affected. It is 122 pages.

These new tariffs could cost the average American a thousand dollars a year. Another round of tariffs on Chinese imports are set to take effect on December 15.

Copyright 2019 KOLD News 13. All rights reserved.

Maria R. Newman