Following a full-throated campaign by the mold making sector to keep 25 percent tariffs on Chinese-made injection molds, some manufacturers are now pushing the federal government in the opposite direction.
A few larger manufacturing companies, including power tool maker Stanley Black & Decker Inc. and powersports vehicle maker Polaris Inc., are telling President Joe Biden he should rescind tariffs on molds first imposed in 2018 by President Donald Trump.
The back-and-forth comes after dozens of mold making firms sent in comments in recent months to U.S. Trade Representative Katherine Tai urging her to keep tariffs, arguing that they've helped protect jobs and investment in their sector.
Tai is in the middle of a legally mandated review of $50 billion worth of imports in the first round of 2018 China tariffs.
Some are arguing that the tariffs are, on balance, hurting U.S. manufacturing. Stanley Black & Decker and other major manufacturers told Tai that the mold tariffs are making their U.S. factories less competitive because they raise the price of manufacturing inputs.
"SBD is the only U.S. manufacturer that produces hand and power tools at scale in the United States," the company said. "However, the United States simply lacks the capacity to produce every part and component used as an input for U.S.-manufactured products.
"SBD and other U.S. manufacturers thus import lower-value inputs for complex products like power tools, which ensures that SBD can continue producing finished goods at scale in the United States," it said.
One smaller manufacturing company echoed that message in its formal filing to the USTR.
Pittsburgh-based Blazer Brand LLC, which makes durable plastic straps to secure trash and recycling cans, said tariffs on molds make it harder for small businesses to make "smart, low-risk" capital investments to grow.
"Anecdotally, we've used a mixture of Chinese-made and American-made molds for seven years," said Justin Blazer, head of product development and operations. "As of Q3 2022, for injection-type molds, China-made molds still have faster lead times and prices lower than domestic molds even after adding the 25 percent tariff and shipping."
"With regard to innovation, small businesses need access to smart, low-risk capital investments," he said. "To date, we have not come across a U.S. maker of injection-type molds who has sought to demonstrate how they are innovating to make their offerings justify the [less-than] 30 percent added cost of domestic molds."
Medina, Minn.-based Polaris, which makes snowmobiles and other powersports equipment, said imported molds help its 12 U.S. manufacturing plants stay competitive against overseas competitors that do not have tariffs on their imported Chinese inputs like molds.
"The additional tariffs on this line item, and other similar components we import to support our domestic manufacturing operations, have increased our material costs and thereby significantly benefited our foreign competitors who import and sell completed vehicles manufactured abroad," the company said. "These tariffs significantly disadvantage U.S. manufacturing."
Polaris said it was able to get some product-specific exemptions on molds under USTR rules, but it still said the overall business impact was negative. It urged USTR to "solidify that exclusion policy and permanently exempt" molds.
The company, which wants USTR to remove tariffs on 15 other Chinese products besides molds, said the cost of tooling and other tariffs have been too high to justify any limited gains on the larger policy goals the government has — changing Chinese trade policies around intellectual property protection and technology transfer.
"The tariffs only compounded the supply chain challenges that have multiplied over the course of the COVID-19 pandemic, contributed to historically high inflation, and harmed the competitiveness of U.S. manufacturers like Polaris," the company said.