GDP Growth Is Small Comfort To Business Owners Grappling With Tariffs
AILSA CHANG, HOST:
The solid GDP growth is small comfort to business owners grappling with the new tariffs. The Brinly-Hardy Company is a family-owned business that manufactures lawn equipment in Indiana, things like lawn aerators, leaf sweepers and seed spreaders. This week, its CEO, Jane Hardy, said the president's steel tariffs could be the nail in her coffin. This is a company that was founded in 1839, making horse-drawn plows. It's weathered wars, depressions and recessions. Jane Hardy joins me now to talk about all of this. Welcome.
JANE HARDY: Thank you.
CHANG: So when you said these words nail in our coffin at a hearing of the U.S. Trade Representative this week, what were you trying to express?
HARDY: That small companies like ours are being impacted in multiple ways. For us, it's the products that we make because of the steel tariffs and the increases on steel - you know, 35, 37 percent. It's components that we buy from various places - wheels and plastic parts and that type of thing - and then the few products that we import complete from Asia. All of them are being affected by the tariffs.
CHANG: I mean, I'm just sort of assuming by the choice of the word coffin, are you saying that these tariffs will be the death of your business if they continue for much longer?
HARDY: If they continue for much longer, sure, they could be.
CHANG: What steps are you taking now to offset the higher costs that you're facing because of these tariffs?
HARDY: We cut our production way back so that we could skinny down the amount of steel that we need to buy right now. We had to make the decision to cut, and we have had to have a pretty significant layoff. We're hoping that the tariffs are rescinded, but we're not getting many signs that that's happening any time soon.
CHANG: How many people have you had to lay off since these tariffs kicked in?
HARDY: We've had to lay off about 75 out of about 200 employees since February. We don't want to produce this time of year and pay those prices for the steel, so we're trying to hold off.
CHANG: You say that you manufacture things that have parts that come from China like wheels and hardware. Would you consider getting these parts domestically?
HARDY: Yeah, we do. Quite a lot of them we do. Certainly we're looking at everything.
CHANG: I guess what I'm trying to ask though is, I mean, in part, that is the purpose of these tariffs according to President Trump. So is that a good thing to try to incentivize companies like yours to try to source domestically more?
HARDY: Sure. I think - you know, I support the U.S. manufacturing economy. I think it's important. I support the need to convince China to behave differently regarding intellectual property. But I don't think this is going to have its intended consequence of having U.S. manufacturing be that much stronger if the steel prices in particular don't back off to levels that we can afford to pay.
CHANG: President Trump has been saying this week, just be patient; have patience. How would you respond to that?
HARDY: I think larger companies maybe can handle that better than we can. We're not that large, and our business is very seasonal. So the spring season was painful for us. The fall season we're facing now will be impacted by all of these tariffs. And we have to be able to survive it. At this point, we're not sure if we can.
CHANG: Trump has offered farmers $12 billion in emergency aid to weather the effects of the tariffs. And I'm just curious. As an equipment manufacturer, do you think that the government should start thinking about some aid for companies like yours?
HARDY: No, I don't think that's the right tactic at all.
CHANG: Why not?
HARDY: Well, (laughter) I think not imposing the tariffs is a better way to do this. There's ways to negotiate to have other things happen, and the tariffs are attacks on U.S. consumers because ultimately, if the steel tariffs don't back off, we have to try to pass that through, and that will be a tax on consumers.
CHANG: Jane Hardy is CEO of the Brinly-Hardy Company, a lawn equipment manufacturer in Indiana. Thank you very much.
HARDY: Thank you.
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