Tariffs Hit East End Goods from Boats to Backup Generators

The United States has been imposing, and some delaying, tariffs, leading to a wide range of retaliations, impacting some imports to and exports from Long Island’s East End. The biggest impact, however, is on imports to the region.

Tariffs imposed by the United States, and by other nations in retaliation, are impacting everything from boats to backup generator components, solar energy to food as the East End feels the impact of global policies that can boost prices and diminish sales.

Although U.S. tariffs have been on again and off again, they are leading to retaliation, as President Donald Trump says more could be rolled out in upcoming weeks.

A tit-for-tat tariff war started as the United States imposed 25 percent tariffs on imports from Mexico and Canada, before excluding most products at least temporarily.

Tariffs, meanwhile, increased to 20 percent on China, which then imposed taxes on agricultural goods imported from the United States.

U.S. farm products such as chicken, beef, pork, wheat and soybeans sold to China now face tariffs of 10 to 15%.

Mexico President Claudia Sheinbaum put retaliatory tariffs on told, while Canadian Prime Minister Justin Trudeau imposed retaliatory tariffs at this neighbor and huge market.

Trump said 25% tariffs on steel and aluminum imports and tariffs on Canadian dairy and lumber could start within weeks, as tariffs tack on huge taxes for goods imported into or exported from the United States.

“Since China is a major import partner, the tariffs are very concerning, and on the export side Canada and Mexico are major partners,” said Louis Biscotti, national food and beverage services leader at CBIZ. “Reciprocal tariffs, while allowing for ‘fairness,’ could hurt the Long Island economy.”

U.S. boat companies have been hit hard by retaliatory measures hurting sales abroad, such as Regal, Cruisers Yachts and Pursuit Boats, all made in the U.S.

And American liquor, wine and spirits have been removed from many Canadian shelves, in retaliation against Trump tariffs at least temporarily delayed until April 2.

Lawson Whiting, CEO of Brown-Forman, which makes Jack Daniel’s, called removing U.S. brands from Canadian stores “worse than a tariff.”

Many industries relying on components made abroad also are feeling the impact of tariffs imposed by the United States.

The backup generator industry, for instance, has been feeling the pinch, following manufacturer price increases in February followed by hikes due to tariffs. Prices were hiked about 4 percent in February, before a 1.5-3 percent hike due to tariffs.

“That added a percentage that wasn’t anticipated,” said Michael Kromer, president of backup generator supplier Easthampton Energy Solutions LLC, based in East Hampton. “Cost of goods is going up.”

While products may be assembled in the United States, they often include parts imported from around the world. Although many generators, for instance, are assembled in Wisconsin, they include parts facing tariffs.

“We haven’t seen any impact on business yet,” Kromer said. “Our customer quotes have gone up. We haven’t seen anybody turn down based on that increase.”

Long Island wines are sold largely on the domestic market, but wine sales to Canada, for instance, are being hobbled by retaliation.

“Canada is the single most important export market for U.S. wines with retail sales in excess of $1.1 billion annually,” Robert P. Koch, president and CEO of the Wine Institute said in a press release.

The U.S. wine industry, according to the Institute, has long argued that wine should not be “targeted in trade disputes unrelated to wine.” And yet wine often finds itself caught up in trade wars.

“Wine is a high-profile, highly value-added agricultural product and this sometimes makes it an attractive target in disputes,” according to the group. “Unfortunately, wine is once again caught up in ongoing trade tensions between the U.S and China and the European Union, which have resulted in wine being targeted with retaliatory tariffs once again.”

The Wine Institute said it “strongly advocates for the removal of wine from all trade retaliation lists regardless of the market.” Nobody wins from these measures, the group argued.

“Retaliatory tariffs like those currently in place invariably harm U.S. wine producers and impede the growth of the wine industry,” according to the group.

Brown-Forman President and CEO Lawson Whiting in a recent earns release sited the “uncertainty” surrounding tariffs.

“While we anticipate continued uncertainty and headwinds in the external environment, we are also confident that we have the right people, brands, and strategy in place to take advantage of ongoing growth opportunities,” Whiting said.

Although current and contemplated tariffs could dwarf others put in place, tariffs have been used as a trade tool long before Trump.

The U.S. government for the fiscal year that ended Sept. 30, 2024 expected to collect $81.4 billion in tariffs and fees, far less than the $2.5 trillion that was expected to come from individual income taxes and $1.7 trillion from Social Security and Medicare taxes

Tariffs could lead to stockpiling, which could boost initial sales or even lead to price hikes. And certain nations are particularly vulnerable to U.S. tariffs such as Mexico, where exports reportedly represent about 40 percent of its national gross domestic product, including 80 percent sold to an d in the United States.

Pepsico and Unilever both source heavily from Mexico, which could expose them to hefty tariffs, while Constellation Brands imports Corona, Modelo, and Pacifico from Mexico.

A Massachusetts Institute of Technology, University of Zurich, Harvard and World Bank study following tariffs during Trump’s first term determined they didn’t create U.S. jobs. They “neither raised nor lowered U.S. employment’,” according to the study.

A study by the Peterson Institute for International Economics concluded Trump’s main tariff proposals would likely take a percentage point off the U.S. economy by 2026 and hike inflation by 2 percentage points.

Tariffs, however, aren’t only a tool used by Trump. The Biden Administration in May 2024 imposed tariff hikes on $18 billion in Chinese goods, including semiconductors and electric vehicles.

That reportedly resulted in a $3.6 billion tax increase which attracted little attention, for a financial measure of that scale.

Tariffs aren’t the only way that governments can encourage and discourage trade. Taxes imposed by other nations, such as Canada, are having an impact on products made in the United States.

The Canadian government, for instance, implemented a 10 percent luxury tax on yachts valued at more than $250,000 in September 2022.