WASHINGTON -- Best Buy Inc. warned Monday that a Trump administration threat to tax all Chinese-made consumer electronics up to 25 % "could be immediately passed on to U.S. consumers."
Jason Bonfig, Best Buy's chief merchandising officer, said in testimony to the U.S. Trade Representative (USTR) that companies are running out of inventory purchased at pre-tariff prices and can no longer absorb cost increases to Chinese-made consumer electronics critical to their businesses.
Bonfig was among speakers on the first of six days of pleas by more than 300 American companies and business organizations from a variety of sectors. The presenters are part of a last-ditch push by America's business community to stop a trade war between the world's two biggest economies.
The parade of speakers comes on the heels of a letter sent last week to the president signed by 150 businesses and groups, including Minneapolis-based Target Corp.
Trump is expected to meet with Chinese leaders at the end of the month during an economic summit in Japan. He believes the application of tariffs and the threat to continue their expansion will convince the Chinese to open their markets to more American businesses and stop stealing U.S. intellectual property. The president also says raising the cost of Chinese goods will encourage businesses to develop U.S. supply chains and expand employment in America.
Those assumptions prompted the current chorus of American businesses calling on the United States to settle differences with China before consumers take a beating.
Bonfig told the USTR that Best Buy and other electronics retailers did not saddle customers with earlier tariff-driven cost increases because many tariffs were only 10 % and mostly limited to high margin products.
Extending tariffs up to 25 % on every Chinese import makes such a strategy unsustainable, Bonfig said.
He also said the short-term impact on China will be minimal because companies will struggle to quickly find or build alternative manufacturing facilities.
Best Buy's call to exempt smartphones, laptop computers, tablets, monitors, smartwatches, gaming consoles and televisions from tariffs spoke to the specific desires of a specific industry. Other sectors are expected to offer their own list of industry-specific exclusions in the days to come.