Impact of Tariffs on Professional Audio-Visual Industry: Anticipations and Approaches
In the world of Pro AV, the latest round of tariffs slapped onto Canada, China, Mexico, and Europe has left industry heavyweights biting their nails. With slim profit margins already, this turbulence ain't good news for the Pro AV realm. Companies stretching from system integrators to independent production companies, and independent contractors alike are feeling the heat. Already, whispers of delayed projects and accelerated timelines have stirred up the industry.
But the questions remain: What's the best move forward for these AV titans?
Gone are the days when Canadian firms, who supply 60% of American aluminum imports, could sit back and revel in their glory. Manufacturers in Canada, using aluminum in products spanning camera housings to control panels and servers, now face a 25% tariff on imported steel and aluminum into the States. Initially delayed, they're back on track, poised to hit the scene on April 2.
Just as the Canadian address book comes to our aid, cases in point – Montreal-based Grass Valley, which uses aluminum in the construction of their LDX series camera chassis and housings, has vowed to honor current pricing on all orders up until March 31, 2025. The company urged its consumers to embrace the stability in pricing and stood firm on its commitment to navigate these market challenges with transparency and fairness.
Until recently, companies like Cisco and Creston, which manufacture in Mexico, enjoyed duty-free passage under the United States-Mexico-Canada Agreement (USMCA). However, these good old days have given way to a 25% tariff, which'll jack up manufacturing prices and inevitably trickle down to customers. If the tariffs stick around, it's just a matter of time before production equipment prices take a steep hike.
To lessen the burden on customers, some companies are mulling over swallowing part of the new tax, while others are touting their "Made in America" credentials and skirting around the tariffs. In a nutshell, the tariffs are all about pushing businesses to local production, right?
Can't say this situation ain't political – even in Canada! Given the sensitivity of the issue, companies aren't exactly eager to wax lyrical about tariffs and "politics in volatile times." But the dust is settling, and we've managed to scrape together a few insights.
Meanwhile, in the land of the rising sun, Chinese manufacturers are taking a bit of a breather. The recently suspended tariffs, dropped from a whopping 125% to a more manageable 10%, have given these manufacturers some breathing room to alter their export strategies and calculate their next moves.
South of the border, Mexico has a similar tale of woe, with general challenges related to tariffs that have yet to surface clearly. European companies, however, are facing a 50% tariff on imports as of June 1, 2025. Ouch! This could pack a major punch on their profitability and supply chain reliability. Bracing for impact, European companies are expected to diversify their supply chains, source alternative components, and ramp up lobbying efforts to soften the blow of these tariffs.
In these uncertain times, project installations stand to feel the ripple of tariff-induced delays and cost hikes. We've been here before, during the pandemic, when many projects fell behind schedule and took a major hit in scale.
The takeaway? The Pro AV industry is facing a challenging period, and companies are scrambling to adapt and find ways to keep the "wheels spinning" amidst these hostile conditions. Early stockpiling and negotiating product purchases with clients to avoid tariff impact are some of the measures being contemplated. Time will tell if such actions will stave off the potential impact. In the meantime, fingers crossed that cooler heads will prevail, and common sense will prevail in these volatile times!
- In the Pro AV industry, the newly imposed tariffs on imported steel and aluminum are causing concern for businesses, from system integrators to independent production companies and independent contractors.
- manufacturers in Canada, who rely on aluminum for products such as camera housings, control panels, and servers, are now subject to a 25% tariff on imports into the US, which will increase their manufacturing costs.
- Some companies, like Grass Valley, are offering stability in pricing to their customers in the face of these tariffs, while others may opt to absorb part of the new tax or promote their "Made in America" credentials to avoid the tariffs.
- The tariffs appear to be an effort to push businesses towards local production, but they could have significant impacts on project installations, profitability, and supply chain reliability for companies in Canada, China, Mexico, and Europe.
