Polaris will consider shifting production overseas unless it gets tariffs exemption
The CEO of Minnesota-based Polaris has suggested the company will reluctantly have to look at shifting some of its production overseas unless it gets some relief from the ongoing tariff war between the U.S. and China.
Scott Wine told investors in a call on Tuesday that the Medina company is exposed to the 25 percent tariff implemented by President Donald Trump on a number of Chinese imports earlier this year, which affects some of the materials it uses to build off-road vehicles.
The company has applied to the Trump administration for exemptions to the trade tariffs, but if that isn't forthcoming, the company will have to consider shifting some of its manufacturing overseas.
"I mean, part of our argument has been if we don't get relief we would have to think about production moves and I think that is something that the administration doesn't want to see happening," he said. "We don't want to see it happen."
"We're really pleased and proud of our American workforce and then we want to continue to be able to support that," Wine added.
Polaris has factories in several states including in Roseau, Minnesota, with others in Indiana, Ohio, Alabama, Iowa, South Dakota and California, and international locations in Mexico, Poland, China and France.
Wine expressed optimism that the Trump administration would assess its exemption requests soon and says they're "expecting" the requests will be approved, but nonetheless is making contingencies in the event they're not.
He referred to the List 3 tariffs on $200 billion-worth of products imported from China – including steel and aluminum – as "the big kahuna," and Polaris is seeking exemptions on 95 percent of the tariffs.
"I don't think there is any chance that we get all of that relief, but the fact that, we get a good number there, I think potentially a really good number there, could be helpful," he told analysts.
The comments from Wine came on the same day Polaris reported positive 3rd Quarter results, with sales increasing 7 percent to $1.772 billion, and adjusted gross profits up 24.9 percent.
