During May's NAMM Fly-In, Leaders from NAMM, Fender, Gibson, Martin, PRS and Taylor met with Tennessee Senator Bill Hargerty's office to discuss the devastating impact of potential tariffs on imported tonewoods essential to U.S. guitar manufacturing.
After the Trump administration imposed tariffs on products made in China in April, nearly every company in the MI industry has felt an impact. Here, we speak with a few MI companies to get a better picture of this constantly developing situation.
On April 2, President Trump issued an Executive Order introducing sweeping new tariffs, including a 10% baseline on all imports and a 54% total tariff on Chinese goods, sparking global trade tensions. The move has triggered sharp market declines, international retaliation — especially from China — and widespread criticism.
Since then, NAMM has responded that this Executive Order will have “serious and devastating consequences for the music products industry, which is already facing challenges from the previous tariffs imposed on products imported from China, Canada and Mexico, as well as the additional tariffs on imported materials.”
During the annual NAMM Fly-in to Washington, D.C. in early May, John Mlynczak, NAMM’s president and CEO, and a team of leading MI manufacturers, including reps from PRS, Fender, Martin and Gibson, all met in a closed-door meeting with legislators on the tariffs.
Additional coverage of that meeting will run in our July issue, however, prior to the meeting, NAMM’s Mlynczak released a statement reading in part that NAMM believes the imposition of tariffs on the music products industry will cause U.S. businesses that manufacture guitars, pianos, violins, mandolins, woodwind and percussion instruments, electronic components and accessories to lose their global competitive advantage in producing high-quality pro- and entry-level instruments.
“The unique supply chains of the music products industry are also unfairly impacted by these tariffs,” Mlynczak said. “For example, while the share of all U.S. imports from China is 13.4%, the music products industry’s China imports are 43%. Vietnam is 4.2% overall, while the music products industry is 26%.
“We continue to urge the administration to exempt musical instruments and accessories, along with materials used to manufacture musical products, from these measures. The negative effects threaten the economic and cultural impact of U.S.-made musical instruments and accessories.
Just ahead of the Fly-in tariff meeting, we spoke with one B&O manufacturer who said the impact of the tariffs has “been direct and immediate.”
“We’re focused on staying operational and building resilience,” the supplier who asked to remain anonymous said. “That means continuing to fulfill orders — even if it’s in smaller quantities — and keeping product moving where there’s still demand. Some of our dealers have paused or scaled back, but we’re still moving inventory where demand remains active.
“As a brand, we’re also preparing to expand direct-to-consumer sales if needed,” the supplier continued. “It’s not our preferred model — we believe in supporting our dealer network — but with rising costs and thinner margins, especially on China-made merchandise, we need options to maintain cash flow.”
One piano manufacturer we spoke to shared a more daunting picture.
“With the dramatic tariff situation, all the exports to the U.S. have been postponed,” their rep said.
The ‘Trickle-Down Effect’
Retailers across the country have reported getting notices from their manufacturing partners regarding price increases due to the China-related tariffs, including Tim Pratt, owner of Dietze Music in Lincoln, Nebraska.
“We’re seeing price increases all the time,” Pratt said. “We’re getting notices from suppliers daily. I’ve had some tell us: ‘I’ve got stuff on the water, which means it’s going to come in at the higher price. It’s already almost here.’ So, what are they supposed to do? They have to pass the price along. As a result, sales slow down for all of us, and meanwhile the end [result] is the consumer can’t buy what they need to in order to continue their music journey. That’s important because that’s going trickle right down into the schools where the educators can’t buy what they need. And then it just gets to the point where now they have to make choices.”
Pratt said his main concern surrounding the tariffs and the MI industry is the effect on the education market.
“My thinking is: Was the United States trade balance out of whack? Probably, but that’s above my pay grade. That said, sometimes I don’t think the people making the decisions understand the trickle-down effect,” Pratt continued. “If you’re going to start doing this, where all of a sudden you’re now taking instruments out of kids’ hands due to these higher prices, we’re really hurting our future.”
Echoing Pratt’s sentiments, Peter Sides, president of Robert M. Sides Family Music Centers in Williamsport, Pennsylvania, said he’s seen firsthand how rising costs are creating serious concerns, not only for retailers, but also for families, schools and music students.
“The worst effect has been the hit to consumer confidence caused by the uncertainty in household budgets,” Sides explained. “The hesitation from consumers, unsure of where their finances stand, is my biggest concern. Just like wholesale or retail businesses, families and schools need to make decisions based on the best information available. When that information is unreliable or constantly changing, people ‘freeze,’ cut back or simply do nothing.”
For Sides, communication with both staff and customers is essential, even when the full picture isn’t clear. Transparency, he believes, helps to alleviate the uncertainty that customers may be feeling.
He also pointed out that certain items, like serialized goods, instruments and stands made of steel, have been particularly hard-hit by the tariffs.
“We’ve had some orders canceled here and there, but we’ve been ordering heavily over the last few months,” Sides explained. “We’re in a good position for the next six months, at least. That said, I cringe thinking about container prices once shipping resumes, especially when there aren’t enough ships or containers to keep up with demand out of China.”
Menchey Music, also headquartered in Pennsylvania, is feeling the B&O strain. Joel Menchey, company president, said he’s concerned about how these inflationary pressures will impact not just his business, but the MI industry as a whole. While his stores have yet to experience major disruptions to the supply chain, Menchey said the warning signs are impossible to ignore.
“We’re starting to see some levels of tariff-driven price increases that are beginning to be untenable in the current consumer environment,” Menchey said.
The biggest red flag for Menchey lies in the B&O sector, and while supply chain disruptions haven’t hit his stores just yet, he’s bracing for what could become another cascading crisis.
“If this goes on for another month or so, whether resolved or not, the MI industry will start to see COVID-level delays in the supply chain,” Menchey said.
Menchey warns that whether products are hit directly by tariffs or forced into costly domestic production as a workaround, the impact will be felt across the board.
“Even at reasonable levels — and most of the tariffs are far from reasonable — the tariffs or domestic production of foreign-made products will be inflationary for all consumer products, including musical instruments,” he said. “This could impact not only the affordability of our products for end-users, but could impact business models which could result in job losses for our customers,” Menchey said.
For now, Menchey said he’s staying proactive — keeping stock levels strong, planning ahead and preparing his staff and customers for whatever may come. Still, he said he knows the road ahead may be tough. MI
This is a developing story that Music Inc. will continue to report on in future issues.
