The following is a report from WSBT-TV, a CBS affiliate in South Bend, Indiana.
Not only has President Trump stamped a 25% tariff on aluminum and steel, we are now in a very tense pause on tariffs placed on our neighbors in Mexico and Canada.
Those tariffs are on pause for at least a month. Both sides of the border are huge contributors to RV manufacturing here in Michiana. Elkhart County produces nearly 80% of the global RV supply. One of those manufacturers in Elkhart, Gulf Stream Coach, is the largest family owned RV business.
They say if these tariffs are greenlit on March 1, the cost will fall on buyers and employees.
The President of Gulf Stream Coach, Phil Savari, says he has been making calls to partners in Canada because not only would a tariff impact demand for RVs, most of which are made in Elkhart, it would also leave Canada to reciprocate the tariff and raise the cost of supplies that are needed to build the RVs here at home.
“Probably, if the tariffs go through, not only the people in Canada but the people in the United States here are going to have to look at lowering prices and you know to balance the offset of costs, and margins won’t be as successful as we all would like,” said Savari.
It was just hours before the 25% tariff on all imported goods from Canada and Mexico was set to take effect when President Trump put a pause on the order until March 1.
In the meantime, manufacturers in Elkhart County, the most concentrated hub of RV manufacturing in the world, are preparing for a dip in profits if the cost to import building materials from Mexico and Canada go up.
Savari says Elkhart relies on both neighbors to supply materials and buy the finished product.
He says the inevitable retaliation from both countries would make profits suffer, just when the numbers were recovering from COVID era deficits.
“Prior to these tariffs being announced, everyone was looking at a 12% to 50% growth in the RV industry, which may slow that now,” said Savari.
Savari says Gulf Stream Coach imports a large portion of their building materials from both Canada and Mexico, a process he says takes up to six months.
“So there is going to be some inventory here to use up. A few of our suppliers have hinted to potentially price increases because of the tariffs. But we’re working very diligently and closely with them to keep the cost down,” said Savari.
Savari predicts a 2% to 4% increase in the cost of an RV if the 25% tariff holds true starting March 1.
The cost will not come to just consumers, employees on the assembly line would also feed the effects.
“And if costs become prohibited, then it’s goint o slow down that impact, which means you’re not building as many RVs as you would like to, which means you can’t employ enough people,” said Savari.
Gulf Stream Coach is using the temporary pause to make as many sales as possible before trade partners have to raise the price of supplies.
“An then when the 30 day pause on that was a little bit of a blessing because a message that I sent out was, ‘get as much as you can right now, we’re all coming into RV selling season’,” said Savari.
