Trump’s tariffs are said to boost domestic orders at some U.S. factories

 Some small and midsize manufacturers across the United States are experiencing a surge in demand, driven by companies looking to sidestep newly imposed tariffs, The Wall Street Journal reported on Sunday. For some, the uptick signals that the trade measures may ultimately provide long-term benefits.

While President Donald Trump’s tariffs have disrupted global supply chains and posed challenges to the broader economy, they’re also making domestically produced goods more attractive in terms of pricing -- something many U.S. manufacturers haven’t seen in years.

Jack Schron, president of Jergens Inc. -- a company that produces industrial tools such as screwdrivers, clamps and hoists -- reported that his operations in Chicago and Cleveland are running around the clock. He attributed the boom both to new orders from tariff-averse customers and strong ongoing demand from the defense sector, the Journal reported.

Bigger picture is mixed

These developments lend support to proponents of tariffs, who have argued that the measures would rejuvenate American industry. Still, the larger manufacturing picture is more mixed. Many major corporations have yet to announce new U.S. facilities, and broader indicators reflect cautious sentiment. For example, a recent Federal Reserve survey in Texas highlighted increasing concern among manufacturers over the economic impact of tariffs.

Donny Chaplin, president of Grand River Rubber & Plastics in Ashtabula, Ohio, said his company has received fresh inquiries and orders from businesses reconsidering offshore suppliers. Two former clients who had previously shifted production to China have returned, seeking to buy rubber gaskets for use in plastic pails. Three oil filter manufacturers have also expressed interest in shifting supply away from China, with two already placing orders.

If all the business materializes, it could add $5 million in annual revenue to Grand River -- about 10% of the company’s total. Chaplin is pushing for long-term contracts to justify the potential need for new hires and production line expansion. The contracts would also shield the firm if tariffs are later lifted.

Still, Chaplin notes that while tariffs help on the sales front, they also increase operational costs. Grand River relies on Chinese imports for certain factory supplies like safety glasses and ear protection, now subject to tariffs as high as 145%. Some raw rubber materials are also hit with a 10% duty. Chaplin said they’ll manage for now, but price increases for customers are likely, the Journal reported.

Tariffs cut both ways

Other manufacturers, especially those more dependent on imports, are less optimistic.

Austin Ramirez, chief executive of Husco International near Milwaukee, said his company has spent the past decade reducing its reliance on Chinese components -- now down to 20% of its supply chain by value. But he added that some parts are irreplaceable in the short term, the Journal reported.

Tariffs have provided a lifeline for companies that emerged during the Covid-19 pandemic to produce personal protective equipment domestically. After struggling to compete post-pandemic, many of these businesses are now seeing a revival. SafeSource Direct, a Louisiana-based manufacturer of synthetic rubber gloves, has restarted two production lines in response to growing orders, bringing its total to eight. The plant is now producing around 118 million gloves per month.

Alan Rust, the company’s chief growth officer, said that recent U.S. tariffs have doubled the cost of Chinese rubber gloves, prompting buyers to search for alternatives.

Even so, Rust added that raw materials such as nitrile rubber chemicals -- imported from countries like Brazil and Italy -- are now also subject to 10% duties, slightly undercutting the company’s cost advantages.

At AccuRounds, a Massachusetts-based producer of metal components, increased orders have led to overtime shifts. Two former clients who had previously offshored production have returned, pushing first-quarter sales up 20% year-over-year, Chief Executive Michael Tamasi said to the Journal.

Meanwhile, consumer goods giant Whirlpool (NYSE:WHR) is also watching tariff developments closely. With 80% of its appliances made in U.S. factories, the company believes the latest tariffs on imported washers and components will help level the playing field.

Chief Executive Marc Bitzer said tariffs could help close the $150 price gap that foreign competitors enjoy thanks to lower material costs. Still, Whirlpool (NYSE:WHR) expects its own expenses to rise by 2.4% -- roughly $400 million -- this year due to tariffs, and it plans to manage that by raising prices and cutting costs, the Journal reported.

https://www.msn.com/en-us/money/markets/trump-s-tariffs-are-said-to-boost-domestic-orders-at-some-u-s-factories/ar-AA1E8XJd