On March 1, the Trump Administration announced its intention to impose tariffs on imported steel and aluminum by adding a 25 percent tax on imports of steel and 10 percent on aluminum. Economists, Republican lawmakers and industries that use these metals have all warned of potentially harmful effects.
In response to the news, Terex Corporation’s President and Chief Executive Officer John Garrison sent out a letter on March 6 explaining “the impact of the rising cost of steel is too large and too sudden” for the company to absorb.
“Steel prices have been rising steadily for several months, and this action drove prices even higher, reaching heights not seen in many years,” Garrison said. “Given the uncertain nature of these market dynamics, we are not increasing our base prices. Instead, we will be adding a steel cost surcharge on our equipment. The surcharge will cover a portion of our cost increases - and will remain separate and transparent from our base prices.
“As the price of steel normalizes, we will adjust or remove the surcharge. Our aim is to minimize the impact on your business. We are still finalizing the details of the surcharge - your Terex representative will communicate with you very soon.”
Congressional Republicans are worried about sparking trade wars with key U.S. allies and Canada and Europe have already threatened to strike back with taxes on U.S. exports if Trump goes through with the tariffs.
Garrison said the company regrets it has to take action.
“As a global manufacturer, we value free and fair markets, and see the imposition of these tariffs as a significant source of friction in the global economy,” he said. “It is particularly frustrating to have these added costs imposed now, creating unnecessary headwinds at a time when markets are trending favorably. We encourage you to join us in asking your government representatives to seek the elimination of these tariffs.”