In southern Malaysia, furniture manufacturers are in a race against U.S. President Donald Trump's tariffs.
After threatening to impose a 24% tax on all goods imported from the Southeast Asian country, Trump said Tuesday he would cut rates 10% for most countries for 90 days. Factories here took that as a deadline to fill as many orders from U.S. customers as possible before the higher rate kicks in.
Muar, in Malaysia’s Johor state, is a major hub for Malaysia’s furniture industry, and the U.S. is its largest export market, accounting for roughly 60% of total exports.
At the Corporate Specialist kitchen furniture factory, workers were packing goods and loading them onto containers as fast as they could on Friday.
Chief Financial Officer Peihing Tsai said the company exports 100% of its products to the U.S.
“We are working overtime now and trying our best to motivate our workers, because these 3 months will be very busy," Tsai said. The company has managed to push out more then 30 containers the past 4 days — the amount it normally ships in a month.
President Donald Trump’s new tariffs threaten to push up prices on clothes, mobile phones, furniture and many other products in the coming months. They could end the era of cheap goods that Americans enjoyed for about a quarter-century before the pandemic.
Tsai said he fears distributors will abandon the factory if tariff rates go above 10%. But still, he added, there's no way the company could move production to the United States — “the cost is astronomical.”
In the end, he said, “the increased price will be have to borne by our end consumers.”
Candice Lim, general manager at furniture maker Natural Signature, said she sees Trump's threats of higher rates as a bargaining position because of the costs they would impose on American consumers.
“It is unlikely to go on in this way," she said. "Otherwise, how can the American people stand it?” she asked.
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