Tales of the Tariffs - PECO
Producto Resources Group (PECO)
Editors Note: The Council of Industry is collecting stories from its members chronicling the impacts (both negative and positive) of the ongoing and evolving implementation of new Tariffs. We will also share these stories with elected officials.
Producto Electric Corporation (PECO) has a 90-year history, as a family-owned business, of providing quality electrical conduit fittings & accessories to the US and Canada construction market. We used to have manufacturing/production capabilities for 65% of our business with our die cast and other machines but had to off-shore all but 20% of our production work in the early 2000’s to have a viable chance of survival in this global market.
Since 2018, Producto Electric Corporation (PECO) has reduced our purchasing from China from 70% of our raw materials and products, to 28%. In this commodity industry, the US manufacturing companies have not been price competitive. In fact, our US PVC suppliers in 2021 limited all domestic orders and could not fulfil 80% of our orders. As recently as October 2024, a US company who produces some of our explosion-proof line, received a larger order from us and went from a 6-week turnaround to 5 months – losing us tens of thousands in business. Domestic manufacturing, for this type of commodity product (malleable iron, steel, PVC, etc.) is not something the US should invest in as, even with exorbitant tariffs, it will not provide a cost competitive option – only have dramatic increases on construction and renovation project costs for businesses and homeowners. We would recommend strategic tariffs on China that start lower and grow over a 1 to 2-year period, for areas where there is the ability to push this business to Thailand, India, Vietnam, Taiwan and other countries that the US has strong diplomatic ties to. This will give our suppliers time to continue to move operations to other US trade partners, help our India foundries to grow their capacity and product options, and minimize the global dominance of China in these markets.