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Margins on products are already low, to
maintain margins we’d have two choices,
raise prices or cutting employees’ hours.
for the experience and to support their local industry.
President Trump will be hoping that the tariffs will encourage US
vape manufacturing. But this is highly unlikely given the hostile
climate in which the industry currently finds itself.
In 2022, the FDA plans to clarify which products are approved
for sale in the country. Until then, potential investors will be
holding back. The organisation has historically taken a conservative
approach to vaping. In this era of heavy regulation, potential US
manufacturers are far more likely to encounter a closed door than
an open one.
Market optimists may look to JUUL as an example of a flourishing
US vape manufacturer. But while JUUL devices are made in the
US and account for around 70 percent of the market there, the
pods themselves are made in China, along with the vast majority
of vaping devices.
Herein lies the second problem. China has over a decade of vape
manufacturing experience and a significantly larger manufacturing
capacity. It would take a long time and a lot of investment for the
US to catch up.
China boasts the second largest economy in the world but growth
is slowing down. Retail sales are lower than anticipated and
banks have been forced to clamp down on unethical lending. So,
for now, it may be that Trump holds the upper hand.
But that will be of little comfort to the country’s billion-dollar vaping
industry which already faces state flavour bans, endless media
hysteria and increasing restrictions on vaping in public spaces.
The trade war is yet another frustrating barrier for the industry
to overcome. If Trump genuinely wants US vape manufacturing
to thrive, his government should do more to promote vaping as
lifesaving innovation and not a threat to public health.
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