RVs are having a moment in America, but President Donald Trump’s tariffs on steel and aluminum threaten to hobble the industry.
Trump announced last week that the administration would follow through with 25% tariffs on imported steel and 10% on imported aluminum. The tariffs went into effect on Friday (June 1), according to CNNMoney.
Airstream-maker Thor Industries Inc., the largest U.S. manufacturer by sales, said on Thursday that tariffs had led to more expensive steel and aluminum prices — and dented the company’s profit margin.
“We are experiencing inflationary price increases…due in large part to the headwinds created by the announcement and implementation of the steel and aluminum tariffs,” CEO Bob Martin said in a release.
Steel prices are up 28% since the beginning of 2018 and average aluminum prices are 19% higher than last year, according to Moody’s analyst Carol Cowan. Uncertainty about trade restrictions have contributed to the price swings.
Steel and aluminum are the nuts and bolts of motorized and towable RVs.
Thor sells several different classes of RVs, but its larger, motorized vehicles depend more on the metals than smaller, lightweight trailers.
Motorized chassis, frames, siding, doors and awnings all contain “sizable amounts” of steel and aluminum, the company says. It also uses the hardware for steps, furniture structures, sinks and appliances.
Thor said Thursday that high consumer confidence, low unemployment, and wage gains are juicing sales.
The company did not say what steps it would take to respond to tariff pressures on Thursday. It turned down an interview request. Winnebago reports earnings later this month and also declined to comment.
The companies have been dealing with higher steel and aluminum prices for months, so tariffs shouldn’t cause too much damage, said Gerrick Johnson, an analyst at BMO Capital Markets.
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