I work in American manufacturing.
Prices are up for all of our materials. We're trying to source domestically but even the raw materials for our domestic suppliers are subject to tariffs and are going up in price.
My industry is directly related to construction/renovation and I can say with 100% certainty that our costs are being passed onto the consumer.
Our operation is international with 8 locations around the world. I can also tell you that our international satellite branches are shifting manufacturing from our location to theirs so they can continue to supply global customers without having to deal with US tariffs. We have $22 million worth of machinery sitting idle because we've lost that business to our international counterparts and competition out of China but we're still stuck paying those machines off.
We produce commodity materials, there is only so much we can increase price before the overseas competition is more appealing even with the tariffs.
On the organization level, investment projects in the US are being cut in favor of international projects. The Japanese holding company that owns our group and several others would rather invest in more stable areas of the world.
Just a quick update on the situation at my factory:
Our biggest customers are cancelling orders. Their global holding groups are demanding the US segments of their businesses shield themselves from exposure by limiting the amount of inventory they have on-hand in their American factories. They want less inventory in order to increase available cash-flow in case prices continue to fluctuate in response to tariffs.
This has turned our production backlog from 20 weeks worth of work down to 1. The orders that remain in our schedule are shrinking in size. One order dropped from 44,000 lbs to just 2,200 lbs. Two of our customers are so severely impacted they've had their credit limits revoked and are "cash-up-front".
Another customer has been completely shut down by their holding group.
We have already shut down 2 lines and are anticipating shutting down 4 more. Out of 8 production lines only 2 are anticipated to run on a severely reduced operating schedule, down to 3-4 days a week instead of 5-6.
In the 40 years this company has been in operation, we've never had machines idle before.
Hiring has also been frozen with talks of layoffs on the table.