Americans will celebrate their Independence Day on Thursday, and many will follow the tradition of setting off fireworks. But many fireworks retailers are worried about trade tensions with China and the potential tariffs that could hit their products. CGTN's Dan Williams recently visited one of them in the state of Ohio.
On the outskirts of Youngstown, Ohio, a group of testers for America's largest commercial fireworks retailer examine the latest products. This is an essential part of the Phantom Fireworks quality control providing feedback to their Chinese based manufactures. But right now, the company's focus is on sales and the busy July 4th period.
"During a six-week period, we do about 90% of our business."
William Weimer is the Vice-President of the company. He, along with the rest of the firework industry, is worried about tariffs. The trade dispute between China and the US had threatened penalties of 25% imposed on fireworks imported from China. Although that tariff threat was recently avoided, following the decision by the US and China to resume trade talks, concerns remain. With US retailers unable to do much about it.
WILLIAM WEIMER PHANTOM FIREWORKS VICE PRESIDENT "The Chinese are the people who have developed fireworks. They have developed the innovations in fireworks. There is no other country that could possibly match the expertise and the experience. Not only can't we find an alternate supply to China, we are not interested in finding an alternate supply to China."
The US commercial fireworks market has almost doubled in size over the last decade from 500 million in 1999, to 945 million last year.
DAN WILLIAMS YOUNGSTOWN, OHIO "The huge array of fireworks that are available is pretty impressive. All of these products are made in China. And if a tariff is imposed, the company say they will have no choice but to pass that cost on to the consumer."
WILLIAM WEIMER PHANTOM FIREWORKS VICE PRESIDENT "We can possibly absorb a couple of percent but we are going to pass on at least 20% of the 25% tariff to our customers. And the customers are going to react very negatively. They are going to buy less. Our business would go down. It would be disastrous."
Shoppers in this store appear to agree.
"So if the 25% tariff came into effect, we would scale back just not purchase as many fireworks just so we could afford the 25% tax on it."
"Cut it back 25%, you wouldn't spend a thousand bucks. You would spend 750, you would have to spend tax of 250 bucks.'
That, Weimer says, would see job layoffs and a halt to expansion plans.
WILLIAM WEIMER PHANTOM FIREWORKS VICE PRESIDENT "Until there is an absolute agreement between the two countries, this threat is looming over us and it is a very insecure feeling."
The signs are promising for an explosive July 4th fireworks sales period. But concerns remain, that the industry could fizzle out if the tariff threat returns. Dan Williams CGTN Youngstown Ohio.