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QINGDAO TODAY
在线翻译:
szdaily -> Business -> 
Manufacturers deploy moves to keep foreign customers
    2019-04-23  08:53    Shenzhen Daily

MANUFACTURERS in China facing trade barriers are deploying an array of moves to try to keep foreign customers — giving discounts, tapping tax breaks, trimming workforces and, occasionally, shifting production overseas to skirt tariffs.

Tariffs from the trade war have been costly for many. Adding to the strain on Chinese manufacturers have been European Union duties on Chinese products ranging from electric bikes to solar panels.

March brought some encouraging news for manufacturers. Industrial output rose at its fastest rate since mid-2014 and exports rebounded more than expected, while first-quarter growth was better than expected.

Still, some manufacturers who depend on U.S. sales are struggling. At the Canton Fair in Guangzhou last week, they put on a brave face, but feared they will need to take more measures to survive if the trade war continues.

Botou Golden Integrity Roll Forming Machine Co. lost some U.S. customers when tariffs pushed up prices for its machines making light steel girders and bars for building frames, according to Hope Ha, a saleswoman.

It now offers an 8 percent discount as a sweetener.

“We have to give discounts because they pay high tariffs,” said Ha.

Ball bearing maker Cixi Fushi Machinery Co. gave long-term customers a 3-5 percent discount, according to representative Jane Wang.

But that was not enough, so the company suspended a product line generating US$30,000 monthly revenue, she said.

“We will wait for the trade agreement and then we will see again,” she said. Now, her focus is on its main market, the Middle East.

Some have been able to pass along increased costs.

California-based ACOPower has increased prices about 10 to 15 percent on some of its made-in-China, solar-powered refrigerators, said founder Jeffrey Tang.

“We have no choice,” he said. “We must increase the price.”

Tang said his portable fridges cannot be made affordably in other countries. But if there’s no trade agreement, and tariffs rise, the equation could change.

“Maybe I’ll just ship all the components to Vietnam to do the assembly,” he said.

Aufine Tyre rented and filled a warehouse last year in California in anticipation of anti-dumping duties, which were later imposed. In another move to circumvent tariffs, it will soon open a plant in Thailand to make tires.

Jane Liu, a sales manager, said Aufine plans to send 50 containers a month from Thailand, with 220 to 240 tires in each, and later expand.

Some companies at the fair cheered China’s move to trim China’s value-added tax to 13 percent from 16 percent at the start of April, and its pledge of tax rebates for exports.

“Things like this give us some protection or else we would suffer losses,” said Wills Yuan, a salesman of Ningbo Yourlite Import & Export Co. in Shenzhen, which produces LED lights.

Shenzhen Smarteye Digital Electronics Co., a maker of surveillance cameras, which are not on the U.S. tariff list, was able to drop prices because of the tax break, according to sales manager Simple Yu.

“We save a lot on costs, so we can sell at a low price,” he said.

But Smarteye has worries, including increasing rent and labor costs that led it to trim its workforce.

Electric bike makers have reacted nimbly to European anti-dumping duties of between 18.8 and 79.3 percent imposed in January. Many have started assembling some bikes in Europe. Zhejiang Enze Vehicle Co. does so in Poland and Finland.

“We take the battery, frame, and the other parts, package them up separately and send them over to be assembled by partners,” said sales representative Dylan Di.(SD-Agencies)

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