Just after midnight on Thursday, President Donald Trump’s latest round of tariffs kicked in, slapping import taxes of up to 50% on goods imported to the U.S. from more than 60 trading partners around the globe.
Imports from India and Brazil are getting taxed at 50%, and imports from Switzerland face 39% tariffs. Tariffs on Canada were raised to 35%, although goods covered under the United States-Mexico-Canada Agreement (USMCA) — including HVAC products — are exempt. Products from the EU and various other trading partners from the Asia-Pacific region are subject to taxes in the 15-20% range, and for Great Britain, the rate is 10%.
“Billions of dollars in tariffs are now flowing into the United States of America!” Trump wrote in all-caps on his social media platform, Truth Social.
According to the Associated Press, the country-specific tariffs imposed Thursday — combined with earlier sector-based duties on products like automobiles and steel and aluminum — are projected to drive consumer prices up by 1.8% in the short term. The Budget Lab at Yale University, a nonpartisan policy research center, estimates that this will cost average U.S. household about $2,400.
Over time, the new tariffs are likely to drive deeper structural shifts in the HVAC industry, especially in how companies source materials and approach manufacturing. But although domestic reshoring has political support, relocating HVAC production to the U.S. is a slow, costly undertaking. It demands major investments in infrastructure, skilled labor, and regulatory compliance — often increasing costs rather than lowering them.
“The popular notion of ‘Make it in America’ does not necessarily translate to more affordable HVAC systems,” wrote Greg Crumpton, vice president of Service Logic, in an article for The ACHR NEWS. “Domestic labor, energy, and raw material costs remain significantly higher than many overseas markets. In addition, many components produced in the U.S. still depend on globally sourced inputs, such as copper, semiconductors, and specialized electronics, which remain subject to international pricing and supply chain volatility.”
And the trade war is not over yet. In an effort to bring supply chains for electronics back to the U.S., Trump is threatening a 100% tariff on foreign-made semiconductors. The move could carry big implications for the HVAC industry, which uses semiconductors in many components, especially as systems become more advanced: think variable-speed drives, control boards, sensors, refrigerant monitoring systems, and smart and programmable thermostats. The tariff would apply to all countries and all companies, unless the business makes a commitment — as Apple did — to invest and build domestically.