US-China Trade Issues: The Battle for Furniture

Executive Summary

The US-China trade dispute rages on, affecting multiple categories including footwear, furniture, apparel and food. In this report, we review recent developments and discuss implications for the furniture category.

• US President Trump recently threatened to increase tariffs on another $300 billion worth of Chinese goods.
• China has said it “doesn’t want a trade war” but added it is “not afraid of fighting it,” according to Foreign Ministry spokesman Geng Shuang.
• Furniture manufacturers originally said they would absorb the costs when Trump imposed 10% tariffs on furniture in September 2018, but faced with May’s increase to 25%, most are reconsidering.
• Manufacturers are also looking for other sourcing sites, but few other countries can equal China’s production capacity, manufacturing technology and overall infrastructure.