INDIANAPOLIS – Businesses in Elkhart are sounding the alarm bell over the recent tariffs, as the “RV Capital of the World” grows frustrated that Republicans like Rep. Braun continue to downplay their effects on the industry that drives the regional economy.
A New York Times story yesterday spotlighted Elkhart’s role as a canary in the economic coal mine and how its booming RV industry is being threatened by recent tariffs on steel and aluminum imports that are driving up manufacturing costs and diminishing demand. Those concerns, however, still aren’t shared by Rep. Braun, who has called their effects “overdramatized” and refused to offer any kind of solution to help Hoosier manufacturers who are concerned about them.
From the New York Times: As Elkhart, Ind., Goes, So Goes the Nation, and Elkhart Is Nervous
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The city calls itself the “RV Capital of the World” — more than 80 percent of the vehicles sold in the United States are made in Elkhart and the surrounding area, according to the RV Industry Association — and Mr. Trump’s tariffs on imported steel and aluminum are increasing costs, diminishing demand and causing concern that a 10-year boom cycle could be waning.
…“I think there’s serious concern about the effects of tariffs on the R.V. industry,” said Senator Joe Donnelly, Democrat of Indiana and one of the Senate’s most vulnerable incumbents this year. His home is nearby. “So many of the components that go into R.V.s are directly affected by these tariffs.”
“It is something that we watch very, very closely having gone through the other side of this when unemployment was 22 percent,” Mr. Donnelly said, referring to the unemployment rate in Elkhart at the peak of the Great Recession.
In Elkhart, a field of R.V.s is as common as corn. An RV Hall of Fame lionizes the industry and its progress from small aluminum trailers to luxury vehicles with the amenities of expensive condominiums. “We like to say we build fun in Elkhart County,” said Mike Yoder, a Republican and an Elkhart County commissioner.
But Mr. Yoder is among those who think the fun could be ebbing. “Everybody in the industry is aware of the negative significance of that,” he said of the tariffs. “We are experiencing a bit of a slowdown in R.V. production, and a number of companies are working four days instead of five to clean up inventory.”
“My personal opinion is this is horrific for the community,” he continued. “This is a really big deal for us. We export a lot of product and import a lot of product. If this whole trade dispute expands much more, it has serious implications, and we will once again lead the country into a recession, without a doubt.”
Mr. Donnelly said he had objected to China’s dumping of steel into the United States, but that the issue should have been resolved by the administration without a broader trade war. The tariffs, he said, had caused uncertainty and “extraordinary upheaval.”
…Nick Kieffer, chief executive and president of the Goshen Chamber of Commerce, agreed. “It’s the uncertainty as well, not knowing where the playing field is going to be,” he said.
The R.V. industry is forecasting sales of about 500,000 vehicles this year, about the same as in 2017 after several years of strong, sometimes double-digit, growth. The tariffs are adding as much as 50 percent to the price of some materials, and the companies in turn are raising prices.
……“My perspective is our folks in Washington are not being honest,” Mr. Yoder said. “There is no plan. This is a very dangerous way to negotiate a trade deal. Folks like people in Elkhart are going to suffer.”
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