HVAC tariff delay to expire, Trump plans new trade measures

President Trump is expected to impose a fresh slate of tariffs on several countries on Wednesday, following those already implemented over the past two months. 

Why it matters: The announcements will likely impact the HVAC industry, as a one-month delay affecting HVAC imports expires, and new countries or products in the HVAC supply chain potentially get affected.

Catch up: On March 4, a 25 percent tariff took effect on all imports from Canada and Mexico, where $12 billion of finished HVAC products sold in the U.S. last year originated. 

• Two days later, Trump partially reversed course, delaying tariffs on products covered by the ‘U.S.-Mexico-Canada Agreement,’ which includes HVAC products, until April 2. 
• Meanwhile, on March 12, a 25 percent tariff on imports of key HVAC metals steel and aluminum from all countries, including Canada and Mexico, took effect.

The latest: Trump in February instructed the Commerce Department to investigate potential tariffs on another HVAC-related metal — copper — and requested a report within nine months. 

• The timeline may have accelerated, however, as Bloomberg reported last week that these tariffs could be implemented within the next several weeks.  
• While details remain unclear, Trump has previously suggested a 25 percent rate. 

Between the lines: The president last week imposed a 25 percent tariff on all auto imports starting Thursday, April 3, potentially opening the door for additional sector-specific tariffs. 

The big picture: Trump has declared Wednesday as “liberation day” for America, elaborating on Truth Social that the U.S. has been “ripped off and abused by every nation in the world.”

• “Now it is finally time for the Good Ol’ USA to get some of that MONEY, and RESPECT, BACK,” he added.

Zoom in: There could be “significant stacking of tariffs,” too, HARDI writes, referring to the administration considering country and material-specific tariffs on top of sector-specific ones. 

• “For example, steel and aluminum products imported from China are subject to at least three tariffs: Steel and aluminum products from China at 25%, steel and aluminum tariffs on all imports at 25%, and a 20% tariff on all imports from China,” HARDI adds.  
• “This would be a 70% tariff on a product made of steel or aluminum from China.”

Of note: The specifics of the new tariffs remain unclear at this point, and the administration’s decisions have been on-again, off-again, as shown by the Canada and Mexico delay, suggesting further changes could occur between now and Wednesday. 

The bottom line: While much remains uncertain, Wednesday’s announcements will likely have downstream impacts on numerous industries, including HVAC.