Tariffs Continue to Dominate Supply Chain, Manufacturing Discourse | Super Radiator Coils

An eventful first year of the second Trump administration has been especially relevant to those in the manufacturing and supply chain industries as of late, with tariff-related conversations taking center stage.

Starting almost immediately following his election victory in November, the Trump administration has made tariffs – and global trade policy overall – a staple of their economic discourse. Trump’s first term featured a similar focus, albeit to a lesser degree, with 2018/19’s tariffs totaling just under $400 billion. This time around, the administration’s tariffs are set to affect well over $1 trillion of imports. Among the participants in the tariff tit-for-tat include are major US trade partners, notably China, Mexico, Canada, and the EU. Some developments that are especially relevant to the manufacturing sector include:

• Tariffs on imports of aluminum and steel – materials that are both critical to the manufacturing of HVAC-R and HVAC-R adjacent products – were raised from 10% to 25%. This increase also carried with it the removal of all existing exemptions on those materials.
• The administration announced in late February that it would be investigating the national security implications of copper imports to the US.
• The White House has also issued a number of tariff threats, notably a 25% tariff on all EU imports as well as a 25% tariff on automobile imports.

At Super Radiator Coils, we depend on the availability of a myriad of raw materials, subcomponents, and other items to manufacture our custom heat exchangers. Our materials and procurement department is a major strength of our operation, playing a critical role in our ability to provide our customers with high quality, cost competitive products.

Their roles extend far beyond price shopping and vendor evaluations, and the recent tariff developments across the globe have added a complicated and unpredictable wrinkle to their day-to-day work. As such – and being that the HVAC-R industries and adjacent markets being especially affected by trade policies on things like metals – we talked to some of our purchasing team to get their take on the supply chain landscape over the last few months.

“Recent tariff activity has heavily impacted our day-to-day workflows. It’s very fluid and changing by the day,” said Mark Schuch, SRC’s Corporate Materials Manager. “We’re feeling pretty good about our ability to manage the product we import directly, but the impact on indirect items is still unclear.”

Schuch said that supply chain volatility is nothing new – especially since the onset of the 2020 pandemic. And, while this period of turbulence may be stemming from a different source, there’s likely to be some similarities as far as how organizations manage the situation.

“During COVID, prices got crazy, and vendors started to allocate capacity to their customers,” said Schuch. “Prices to import got crazy and it switched from a buyer’s market to a seller’s market. I can see this happening with US vendors, where the tariffs will drive everyone to buy from the US, which will drive up prices, since the US demand will be higher than the supply.”

While the tariff landscape has certainly complicated the work of supply chain professionals like Schuch, he says there’s optimism that the current level of disruption could be short-lived. He also said events such as this are a good stress test for vendor relationships, presenting an opportunity to bolster existing relationships with suppliers.

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