BAKERSFIELD, Calif. (KERO) — President Donald Trump signed an executive order to place a tariff on metal imports. This leaves people, including bicyclists, wondering– how will this affect the bike industry?
- Following an executive order to place a tariff on metal products, locals speak about what impacts people in Bakersfield can expect.
- Aaron Hegde, the professor of economy at CSUB, says one of the factors is the buyer.
- While it's uncertain exactly when these tariffs will start and what exactly this will look like for the economy, people can expect to see some price changes.
BROADCAST TRANSCRIPT:
In February, President Donald Trump signed an executive order placing a 25% tariff on all steel and aluminum imports. While this tariff has been delayed, it’s still something that companies and consumers should keep in mind.
“Our economy as a country, 70% of it is based on consumption. So 70% of our GDP comes from people buying stuff and a lot of it comes from China, Canada, and Mexico who are our largest trading partners,” said Aaron Hegde, the professor of economics at CSUB.
He says 80% of bicycles sold in the United States are imported from China. But he adds that tariffs haven't always helped in the past.
“...These kinds of tariffs never have a good impact on the economy,” said Hegde. “The economy always prices go up, people buy less, the economy slows down.”
So who is covering the tariff? Hegde says it depends on the competition of the businesses. If there are more bike shops, customers may not see that much of a price increase passed onto the customer.
“If there are many bike shops or if people are sensitive to the prices for bikes, then they may not be willing to pay any portions of $50, which means that the importer or the retailer has to take that on, which means that reduces their profit margin,” said Hegde.
Snider’s Cyclery and Locksmith, a bicycle shop that’s been serving Kern County since 1904, says they’ve seen prices increase on some of their products since COVID-19.
“I do expect that probably in the next coming months and next year, there’s gonna be a difference in price. It’s gonna hit some companies more than others,” said Olivia Snider, the owner at Snider's Cyclery and Locksmith.
She adds that while they may see some changes, they hope to keep their products at a reasonable price.
“We’re hoping that we can offer a great value for your bike without it being too expensive,” said Snider.
Hegde recommends that consumers looking to buy a bike take a few things into account.
One- keep in mind what you’re using your bike for and how often you plan on riding. Then, form a budget. Also, factor in maintenance costs.
“If you’re not able to fix it yourself, then you still have to take it into the retailer,” said Hegde. “So sometimes what they might do is they might give a deal on the bike, but then charge more for servicing it.”
While it’s uncertain exactly when these tariffs will start and what exactly this will look like for the economy, people can expect to see some price changes.
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