This article looks at how Taiwan companies react to the tariffs, based on interviews conducted at Secutech held May 7 to 9.
In early April, US President Donald Trump announced to slap a tariff of 32 percent on imports from Taiwan. To this, Taiwan security players expressed optimism that, in the event the tariffs actually take effect, they will prevail due to the high quality and irreplaceability of Taiwan-made products. This article looks at how Taiwan companies react to the tariffs, based on interviews conducted at Secutech held May 7 to 9.
In April, Trump announced sweeping tariffs against various trade partners, including Taiwan, citing US trade deficits. Things have changed rapidly since then. Shortly after the announcement, the 32 percent tariff on Taiwan were temporarily reduced to a 10 percent baseline for 90 days to facilitate further trade negotiations between Taiwan and the States. Then, just last week on May 28, the US Court of International Trade ruled that some of the tariffs imposed by Trump were illegal and that the tariffs be halted, only to see the ruling overturned by a US appeals court.
Initial impact felt
Regardless the final outcome, some Taiwan security companies say they’re already feeling the initial impact of the tariffs.
“Yes, it has an effect on us because most of what we sell in the U.S. are manufactured here in Taiwan. We've slowed down shipments, assuming ... the tariffs may go away or something, but who knows,” said a spokesperson of Superior Electronics, a Taiwan access control manufacturer, at their booth in Secutech.
“When Trump first announced it, many of our customers asked us to halt shipments to the United States. But it’s not just us … this is something that everyone encounters,” said Luke Wang, Sales Manager at 3S Systems, a Taiwan integrator who also has business in North America. “Anyway we’ll just fulfill our existing orders for now, and see what happens at the end of this three-month period.”
One company, meanwhile, said they’ve been impacted “positively” by the tariff situation.
“A lot of customers, they may be carrying our brand, but they also carry other people's brands, right? So maybe they couldn't purchase from those brands due to the tariffs, so they came to us to meet some demands that they have … maybe some more urgent projects that they had with these other brands, they came to us because they had to deliver,” said Alejandro Portillo, Sales Manager at AVTech. “We don't know what's going to be the percentage at the end, but at the moment, in the short-term … it has been a positive impact. For the long term, we don't know yet.”
‘Let them pay the tariffs’
In the event the tariffs really take effect, Taiwan security companies say they are inclined to let the US importers/distributors absorb the additional cost.
“In terms of tariffs, we tend to let customers pay for them in the US market because the tariffs were added without a reason. So basically, the tariffs will be handled by the local SIs. However, we will discuss the details with customers when we ship,” said a spokesperson with Merit LILIN.
“The tariffs will have little to no impact because they will be paid by the customer, who will in turn raise prices on the end user,” said Shen Pei-hsuan, VP of Marketing at Taiwan smart lock manufacturer I-TEK.
Taiwan products highly irreplaceable
As for whether US companies will stop buying from Taiwan if the tariffs do take effect, most companies expressed optimism it would be unlikely due to the high quality and irreplaceability of Taiwan security products.
“The information we have received so far is that there will be no reduction in orders due to the tariffs. At LILIN we are strong at R&D and customization. Whether the customer wants a total solution, or just a digital fence solution, we can provide. There are many different demands, and we can meet what they need,” the LILIN spokesperson said.
Shen of I-TEK, meanwhile, cites that most of their locking solutions are certified for ANSI/UL 305 Grade 1. “To be honest, we are certified for Grade 1, which represents the highest level of security and durability for door hardware. So if our customers don’t buy from us, they need to find a substitute, and frankly there are not many suppliers that are Grade 1-certified,” She said. “So for example if there’s a government requirement that door hardware must be Grade 1-certified, the end user has no choice but to buy from us in order to be compliant.”
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