Samsonite Plans to Raise Luggage Prices After Latest Round of Tariffs
Samsonite has warned retailers it intends to increase wholesale luggage prices by 10% in the wake of this week's latest round of tariffs imposed by the Trump administration on products imported from China, according to a Bloomberg report.
That will likely result in higher retail prices on luggage — and not just on Samsonite brands.
“We pass it on to the consumer,” Samsonite International SA chief executive Ramesh Tainwala told reporters in March after President Donald Trump announced a first round of $50 billion in tariffs on Chinese goods, according to a Bloomberg account at the time. “We have the pricing power. We are the ones who will move first and the industry will follow."
On Monday, Trump ordered the federal government to levy 10% tariffs on about $200 billion in Chinese products beginning September 24. That rate is scheduled to increase to 25% in 2019 "if Beijing refuses to offer trade concessions," Bloomberg reported. The Chinese government responded by announcing retaliatory tariffs on $60 billion worth of US goods imported to China.
Overall, the import tax will affect more than $3 billion in luggage and travel gear imported from China, Bloomberg said.
Besides its own flagship brand, Samsonite — the world's largest luggage maker — also owns American Tourister, Hartmann Luggage and Tumi, among others. The firm manufactures two-thirds of its products in China and already pays a tariff of more than 25% on its products sold in the US.
The list of 5,745 items impacted by the latest round of tariffs includes vehicle tires, golf bags and baseball and softball gloves. Items initially considered for inclusion that were removed from the final tariff list include "certain consumer electronics products such as smart watches and Bluetooth devices; certain chemical inputs for manufactured goods, textiles and agriculture; certain health and safety products such as bicycle helmets, and child safety furniture such as car seats and playpens," according to the Office of the United States Trade Representative.
“We were trying to do things that were least intrusive on the consumer," Commerce Secretary Wilbur Ross told CNBC. “We really went item-by-item trying to figure out what would accomplish the punitive purpose on China and yet with the least disruption in the US."