Prices set to rise as LED tariffs get go-ahead
THE COST OF lighting looks set to rise now that the US government has confirmed that Chinese lighting components will be hit with tariffs of up to 25 per cent.
Light emitting diodes, filament lamps and HID lamps as well as aluminium and solid-state electronic parts are all included on the list of products facing the tax drawn up by the Office of the United States Trade Representative.
The list is worth US$50 billion in revenues to China and covers 1,102 separate product categories. Significantly, item number 85414020, light-emitting diodes, survived the consultation with industry, which took place in May. The tariff includes LED arrays and modules.
The Chinese government, which has for over a decade identified the LED lighting industry as a key strategic sector for support, says it will retaliate with tariffs ‘of the same scale’.
The price pressure from the tariffs coincides with a wave of price increases announced by major US lighting suppliers, including Acuity Brands, Eaton, Venture and Ledvance. They’re putting up the prices of their traditional lighting products by between 6 to 8 per cent, citing rising costs of raw materials such as aluminium.
Industry observers say it’s a matter of time before the price pressure extends to European, Middle Eastern and African markets.
Some manufacturers, such as Korean LED maker Seoul Semiconductor, appear to be already anticipating the imposition of tariffs. It is said to be planning to fulfil US orders from its factory in Hanoi in tariff-free Vietnam, while orders for other regions unaffected by the US tariffs would continue to be shipped from the company’s extensive Chinese locations.