Manufacturing is big business in Wisconsin. We're in the top 10 states nationally with
the second highest concentration of employees in the sector. The industrial machinery sector
is Wisconsin's largest. So what do the 25% tariffs on Canada and Mexico steel and aluminum
mean for companies like Argon Industries, which fabricates sheet metal components for
major companies and imports 70% of its aluminum from Canada? We ask owner Greg Clement. Thanks
very much for being here. Yeah, good morning. So what what has been the immediate impact
of the tariffs, especially for a company like yours, that imports 70% of the aluminum from
Canada? So all our suppliers are getting the material from Canada. And what's happening
is the aluminum has gone up 30% stainless steel has gone up 100% and a cut roll call roll
are averaging 30% increases. And that that is a huge burden that that's just from January
to March. So so do you continue to buy from Canada or are you trying to buy domestically
or would that make a difference? Like you said, 70% of the aluminum comes from Canada. You
really don't have a lot of other resources. And you know, we don't buy from Europe or
China. And so if the if the prices for for that metal, those metals has gone up to that
extent, what does it mean for you and your business? So luckily, most of our customers
understand that materials have passed through. So we're able to re quote it and raise the
pricing, but it typically will delay and cause them not to order as much as they had planned
because of the expense of the material and the cost of the material and what it does
for their end cost. And so if their end costs go up to that extent, what does that mean downstream
for consumers? So it's a tax on consumers. They're going to pass them along. And they're not
going to hold the pricing. And you know, the consumers going to pay the tax. On average,
consumers will pay $3,000 in result of the tariffs per year. So we see you there sitting
inside your operation. What are the applications for your sheet metal fabrications and what
kinds of industries and products?
Yeah, power generation, dehumid event, vacation, scaffolding, a lot of different
internet, electrical enclosures, controls, things of that nature. And so again, your
customers are willing to pay more.
They don't want to, but they understand that it that we can't afford to, you know,
swallow that kind of increase and that we just lose margin.
And so what does that do in your mind to kind of the broader economy, right? If consumers
are going to pay an extra $3,000 and your customers might be pulling back on how much
they buy, you know, what kind of effect does that have?
Yeah, I mean, it's it's raising inflation on the consumer and it will slow the economy
down temporarily. We're hoping that he could, you know, solve these issues and not have
the tariffs, but the problem is we don't manufacture a woman from here. So we have to buy outside.
So for me, the tariff something that we can't even manufacture and then put that burden on
the consumer is wrong.
So as to the domestic production of aluminum, that would seem to be what President Trump
and his administration wants as a result of these tariffs, but how likely is it that the
U.S. could ramp that up?
To build a mill, especially aluminum mill is, it would take very costly and it would take
a long time. I mean, you're talking, keep me out of the office by the time anything
came online.
So so the Fed is signaling about an economic slowdown, possibly a recession on top of everything
that's happening now. How concerning is that?
It's very concerning. We were going to have a record year this year based on our customers'
excitement forecast and they're all growing and this could stop that growth.
What is your message then to the administration?
Let's not tear up something that we can't produce in the United States. Let's not add
burden that he's talking about cars and even aluminum goes everywhere. And it's just going
to increase cost for everyone. And then we are going to have to pay that 25%.
Do you feel as though, do you feel as though that message is being heard?
I don't think it is. I think he has a different end game and it would be nice to know what
his end game is because the other thing we have uncertainty on tariffs, it creates uncertainty
on customers behind. If you don't have certainty of the industry or what you're doing, they're
going to wait and delay.
Now we will see how this goes and we wish you luck and thanks very much for joining
us.
Thank you for having me.
For more on this and other issues facing Wisconsin, visit our website at pbswisconsin.org and
then click on the news tab. That's our program for tonight. I'm Frederica Fryberg. Have
a good weekend.