Tariffs Hit: Lighting Industry Fallout Begins
New trade duties disrupt manufacturers, distributors and projects overnight
The tariffs weren’t just a threat this time — they’re real. As of midnight, the Trump administration’s latest wave of duties slammed into the North American lighting industry like a 30-amp inrush current. The numbers alone are daunting, but the real story is about the scramble happening inside boardrooms, factories, and electrical distributors across the U.S., Canada, and Mexico.
For companies that spent the last decade optimizing supply chains to work around past trade disputes, the game has changed overnight.
Breaking Down the Tariffs
- Canada & Mexico: A 25% tariff now applies to nearly all imports from these two key U.S. trading partners.
- China: The existing 10% tariff on Chinese imports doubled to 20%, driving up costs on lamps, finished goods and critical lighting components. The latest 20% in China tariffs is on top of the March 2018 tariffs implemented during Trump’s first administration.
- Retaliation from Canada & China:
- Canada: Imposed 25% tariffs on $30 billion worth of U.S. goods, including lighting products under HS codes 9405.11.00, 9405.19.00, and others — making U.S. lighting exports instantly less competitive.
- China: Hiked tariffs 10-15% on key U.S. agricultural exports and banned certain American biotech firms.
- Mexico is expected to announce retaliatory measures later today.
What is the impact?
Some manufacturers will feel this more than others. Acuity Brands, Signify, and Current — each having long capitalized on Mexico’s lower labor costs near the U.S. — are now facing a brutal reversal of fortune. That said, each also operates multiple factories in the U.S., which could help mitigate some of the impact through domestic production.
Take Acuity. More than half of the company’s 2024 revenue comes from its seven factories in Mexico. While details remain unclear, an additional 10-15% of finished goods may also be sourced from China. Much of the cost advantage of sourcing from Mexico and China have effectively vanished overnight.
Signify, which operates Cooper Lighting and Genlyte Solutions, also finds itself in a bind, with operations in Juárez, Mexicali, Camargo, and Tijuana suddenly subject to a 25% penalty. And in recent years, the company has invested more heavily in Chinese manufacturing, The maquiladora model, which allowed lighting brands to import Chinese components, assemble them in Mexico, and ship them tariff-free to the U.S., has officially been disrupted.
For U.S.-based brands relying on imported components — LED chips, drivers, housings — the pain doesn’t stop at the border. As suppliers pass along costs, even “Made in America” manufacturers will feel the squeeze. And it won’t end there — steel and aluminum tariffs set to hit next week could further erode the benefits of domestic production.
Stock-and-Flow Brands at a Crossroads
Another group under pressure? Private-label lighting brands that import finished lighting goods from China. These companies thrive on a high-volume, low-margin model, bringing in container loads of made-to-order fixtures that fill U.S. warehouses before being shipped to cost-driven electrical distributors.
While some may swap drivers, adjust optics, or add branding stateside, the core of their business depends on affordable Chinese imports. Now, a 20% tariff on Chinese goods forces a decision:
- Raise prices and risk losing shelf space at distributors.
- Eat some or most of the cost, cutting already thin margins.
- Find a new supplier in Vietnam, India, or Taiwan — a process that won’t happen overnight.
The reality? There’s no easy way out.
What Happens Next?
Lighting companies are scrambling for a Plan B. Some will try to ride out the storm with existing inventory, others will accelerate supply chain shifts to Vietnam or India, and a few may absorb costs in the short term. But for most, price hikes are coming.
- Distributors and contractors should expect gradual price increases.
- Manufacturers may attempt restructuring, but few will fully shield customers.
- If Mexico and Canada escalate retaliation, expect more trade disruptions.
With retaliatory tariffs in play and Mexico expected to announce its response later today, the lighting industry is bracing for further uncertainty. The one certainty? The cost of doing business in lighting just skyrocketed.
Source: https://inside.lighting/news/25-03/tariffs-hit-lighting-industry-fallout-begins
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Smile Lighting Co., Ltd.
By The Associated Press and JAMEY KEATEN, DAVID McHUGH, ELAINE KURTENBACH and KEN MORITSUGU
Published: May 12, 2025 at 4:11 PM GMT+8
Smile Lighting Co., Ltd.
China hopes the U.S will stop “the erroneous practice of unilateral tariff hikes” and work with China to safeguard the development of their economic and trade relations, injecting more certainty and stability into the global economy, the ministry said.
The joint statement issued by the two countries said China also agreed to suspend or remove other measures it has taken since April 2 in response to the U.S. tariffs.
China has increased export controls on rare earths including some critical to the defense industry and added more American companies to its export control and unreliable entity lists, restricting their business with and in China.
The full impact on the complicated tariffs and other trade penalties enacted by Washington and Beijing remains unclear. And much depends on whether they will find ways to bridge longstanding differences during the 90-day suspension.
But investors rejoiced as trade envoys from the world’s two biggest economies blinked, finding ways to pull back from potentially massive disruptions to world trade and their own markets.
Futures for the S&P 500 jumped 2.6% and for the Dow Jones Industrial Average was up 2%. Oil prices surged more than $1.60 a barrel and the U.S. dollar gained against the euro and the Japanese yen.
“This is a substantial de-escalation,” said Mark Williams, chief Asia economist at Capital Economics. But he warned “there is no guarantee that the 90-day truce will give way to a lasting ceasefire.”
Jens Eskelund, president of the European Union Chamber of Commerce in China, welcomed the news but expressed caution. The tariffs only were suspended for 90 days and there is great uncertainty over what lies ahead, he said in a statement.
“Businesses need predictability to maintain normal operations and make investment decisions. The chamber therefore hopes to see both sides continue to engage in dialogue to resolve differences, and avoid taking measures that will disrupt global trade and result in collateral damage for those caught in the cross-fire,” Eskelund said.
Trump last month raised U.S. tariffs on China to a combined 145% and China retaliated by hitting American imports with a 125% levy. Tariffs that high essentially amount to the two countries boycotting each other’s products, disrupting trade that last year topped $660 billion.
The announcement by the U.S. and China sent shares surging, with U.S. futures jumping more than 2%. Hong Kong’s Hang Seng index surged nearly 3% and benchmarks in Germany and France were both up 0.7%
The Trump administration has imposed tariffs on countries worldwide, but its fight with China has been the most intense. Trump’s import taxes on goods from China include a 20% charge meant to pressure Beijing into doing more to stop the flow of the synthetic opioid fentanyl into the United States.
Smile Lighting Co., Ltd.
The two officials struck a positive tone as they said the two sides had set up consultations to continue discussing their trade issues. Bessent said at the news briefing after two days of talks that the high tariff levels would have amounted to a complete blockage of each sides goods, an outcome neither side wants.
“The consensus from both delegations this weekend is neither side wants a decoupling,” Bessent said. “And what had occurred with these very high tariff … was an embargo, the equivalent of an embargo. And neither side wants that. We do want trade.”
“We want more balanced trade. And I think that both sides are committed to achieving that.”
The delegations, escorted around town and guarded by scores of Swiss police, met for at least a dozen hours on both days of the weekend at sun-baked 17th-century villa that serves as the official residence of the Swiss ambassador to the United Nations in Geneva.
At times, the delegation leaders broke away from their staffs and settled into sofas on the villa’s patios overlooking Lake Geneva, helping deepen personal ties in the effort to reach a much-sought deal.
China’s Commerce Ministry said the two sides agreed to cancel 91% in tariffs on each other’s goods and suspend another 24% in tariffs for 90 days, bringing the total reduction to 115 percentage points.
The ministry called the agreement an important step for the resolution of the two countries’ differences and said it lays the foundation for further cooperation.
“This initiative aligns with the expectations of producers and consumers in both countries and serves the interests of both nations as well as the common interests of the world,” a ministry statement said.
Smile Lighting Co., Ltd.
GENEVA (AP) – U.S. and Chinese officials said Monday they had reached a deal to roll back most of their recent tariffs and call a 90-day truce in their trade war for more talks on resolving their trade disputes.
Stock markets rose sharply as the globe’s two major economic powers took a step back from a clash that has unsettled the global economy.
U.S. Trade Representative Jamieson Greer said the U.S. agreed to drop its 145% tariff rate on Chinese goods by 115 percentage points to 30%, while China agreed to lower its rate on U.S. goods by the same amount to 10%.
Greer and Treasury Secretary Scott Bessent announced the tariff reductions at a news conference in Geneva.
Smile Lighting Co., Ltd.
1. Balancing Costs and Quality:
The rise in production costs due to tariffs poses a significant challenge. However, it also encourages manufacturers to streamline operations and seek innovative ways to enhance efficiency. Companies that can maintain a balance between cost and quality are likely to remain competitive despite these external pressures.
2. Supply Chain Adaptability:
The article underscores the importance of a flexible and diversified supply chain. Manufacturers that quickly adapt by sourcing alternative components or relocating some production aspects may better withstand the adverse effects of tariffs and continue to offer competitive pricing.
3. Stimulus for Innovation:
Although tariffs increase the cost burden, they also serve as a catalyst for innovation. The pressure to reduce costs can drive investments in automation, R&D, and advanced manufacturing techniques. Companies that embrace these technologies can offset higher labor and material costs while maintaining high product standards.
4. Market Diversification:
With the U.S. market experiencing price pressures, diversifying into other regions becomes crucial. Manufacturers who target emerging markets or regions with fewer trade restrictions can reduce dependency on a single market, spreading risk and potentially capturing new growth opportunities.
Overall, while President Trump’s tariffs have introduced challenges for the global lighting industry, they also present an opportunity for manufacturers to rethink their supply chains, enhance operational efficiency, and invest in innovation. Industry players who can adapt to these changes are likely to emerge stronger and more resilient in the evolving market landscape.
Smile Lighting Co., Ltd.
The article from Inside.Lighting, dated March 25, examines the fallout from tariffs imposed on the lighting industry, focusing on their impact on global supply chains and pricing dynamics. Here are the key points highlighted:
Tariff Impact on Costs:
The tariffs on imported lighting products, particularly those coming from China, have led to increased costs for manufacturers. This has, in turn, raised the prices for distributors and end consumers, affecting the overall competitiveness of imported fixtures in the U.S. market.
Supply Chain Disruptions:
The new tariffs have caused significant adjustments in supply chains. Manufacturers are re-evaluating their sourcing strategies, with some considering alternative suppliers or shifting parts of production to other regions to mitigate the increased costs.
Market Challenges and Shifts:
The increased tariffs have pressured companies to balance maintaining quality with competitiveness. As a result, some companies are exploring local assembly in the U.S. or diversifying into other international markets less affected by tariffs to secure their market position.
Opportunities for Innovation:
Amid these challenges, the article also points out that the tariffs have forced many in the industry to innovate. Investments in more efficient manufacturing processes, increased automation, and smart lighting technologies are seen as potential solutions to offset the tariff-related costs and improve overall efficiency.