While the full details of President Donald Trump’s recently announced tariffs have not been made public, the CEO of a local manufacturer says what we do know could have some positive and negative impacts.
Wisconsin Aluminum Foundry’s Sachin Shivaram tells SeehaferNews.com that he is looking at the tariffs in three phases: the short term, the midterm, and the long term.
He noted that manufacturers tend to send raw materials overseas for smelting, and import the smelted material back to the U.S.
The smelting process requires a lot of energy, which tends to be cheaper in other countries.
That will, naturally, cause an increase in the price of that material, but the midterm effects could have a positive impact on the American economy.
“We hope that the tariffs will make domestic supply more competitive,” Shivaram explained. “And so over the medium term, they can switch back to domestic sources. That’s going to take some time.”
The reason it will take time all boils down to the construction of new tooling and the certification of that tooling.
“That can take anywhere from a year to two years or longer,” he noted. “So hopefully over the medium term, this spurs that sort of activity. But it’ll be it’ll take some time to find out.”
As for the long-term effects, without knowing the full details of the tariffs, Shivaram says it’s hard to know exactly what will happen, but he has some concerns.
He told SeehaferNews.com, “While the tariffs may help boost the competitiveness of exactly what we make if our customers don’t have competitive access to all the stuff they need to buy in terms of components, the question is, will they still make that end good in America or is the whole thing going to be outsourced?”
Shivaram, who has been active in helping craft legislation to help the manufacturing industry in the past, says he wants to remain involved and help keep that “Made in America” tag on as many products as possible.
“Human labor enables us to transform something that’s a relatively low value into something that’s high value, and that enables us to pay more money,” Shivarm said. “That’s why so many people want manufacturing. It’s good, high paying jobs that can employ a lot of people.
Shivaram noted that there is “a lot still to be understood” about the policy as it is still in its early days, and it’s not clear how long it will remain in place.
In order to know more about its effects, Shivaram said, “We need a lot more details on the policy.”
