Last year, the mad dash by shippers to move products and materials from overseas and across the border ended with the trucking industry generating roughly $100 billion more than previous years. While 2019 saw a big wind-down compared to the last half of the previous year, tariffs have not severely impacted shipments for key industries. However, as the trucking industry looks ahead to the last quarter of the year, the holiday shipping season may present a different outlook.
Tariffs on Consumer Electronics
Everyday consumer electronics – from smartphones to computers, video games, and more – are manufactured and imported from overseas. Similar items, such as toys, furniture, and other products are a big part of our economy, and help drive big sales at the end of every year. The trucking industry, naturally, is integral to moving those items to stores. Third and fourth-quarter rushes in the trucking industry allow fleets to plan for the following year. Because last year’s rush led to a fairly quiet 2019, it was evident that tariffs artificially disrupted the flow of commerce and imported goods, which has impacted the trucking industry.
Acknowledging that tariffs might severely impact consumer spending, the White House has decided to move the date they take effect. The new date for tariffs on consumer goods manufactured in China will be December 15th. While consumer spending has been high throughout the summer months, the delay on tariffs could stimulate another shipping rush like last year. Additionally, companies are moving overseas manufacturing to other countries, such as Vietnam, to avoid tariffs that would otherwise result in slower business for the trucking industry, as well as higher costs for consumers.
The Waiting Game
Ultimately, no one can accurately predict how shippers and importers will respond to the postponed tariffs. There could be another big fourth-quarter like last year, or perhaps there will be no response at all, because everyone is preparing for the frequent claims of the inevitable tariffs. Everyone will just have to wait and see how this will play out.