MIAMI – In his 28 years as owner, Jose Gil, of SS Performance Automotive in South Miami, has survived the Great Recession and pandemic-era supply chain disruptions, and now comes the era of Trump tariffs.
“It is not us that are setting the prices, we have to adjust our pricing according to what the parts cost us,” Gil said in a message to his customers. “We still have to cover our operating costs which is going to go up.”
He said the tariffs are “definitely going to affect us.”
“A lot of parts are manufactured in China. There is not much being manufactured here in the United States,” Gil said. “There are some instances where we can get U.S.-made parts, but for the most part, General Motors, Ford, Chrysler -- they all manufacture their parts in China, Canada, Mexico.”
He said he’s already seen an increase in prices for GM parts. A part that used to cost him $200 has doubled to $400.
“Do you think that is GM already trying to get ahead of what is anticipated?” asked Local 10 News’ Christina Vazquez.
“It has to be,” said Gil. “A customer comes in and (says) ‘I need this’ -- ‘Oh, it is going to cost this much,’ and then when I go to order it, I have to call them back, and say ‘I am sorry, the part has gone up.’ It has been happening the past six months that I have seen the price jumps.”
Local 10 News did reach out to GM for a statement but has not heard back as of the time of this story’s publication.
Many of the auto parts they need to repair your car come from China.
“For older cars, the manufacturers stopped making them and so we have to source it and usually they are coming from China,” said Gil. “At one point, it was cheaper to be manufactured in China but soon that cost is going to rise, the parts are going to be more expensive. There are not many U.S. manufacturers concentrating on older cars, older vehicles, so sometimes our only option is to put a Chinese part in.
“Manufacturers, they had to, I believe, make parts for 10 years and supply them, but I am looking for stuff from 2017, but it has already been discontinued, so we have to go to the aftermarket and most of the time aftermarket is foreign. I am hoping that eventually it will steady out or maybe come down or maybe the powers that be can work something out that will help everybody, from the bottom up, keep prices steady.”
Across town at Shell Lumber in Miami, General Manager Jose Alvarez explained how the 97-year-old company is working to mitigate against raising prices.
“We don’t import a whole bunch of products, but our lumber yard, we like to have quality products and Gormans is the best of the best, the cream of the crop when it comes to spruce,” said Alvarez. “We carry 30 different species, but when you are talking about pine, cypress, or spruce, which is soft woods, in spruce, this is the best product you can buy.”
One product he pointed to comes from Canada. He said he’s bought a three-to-six-month supply before the tariffs take effect in order to keep prices as low as possible.
“Hopefully things will cool down and the price will go back to normal,” he said. “We overbought on purpose until things, hopefully, simmer down.“
It’s a train of thought he said began with the COVID-19 pandemic and the supply chain disruptions that came along with it.
“We thought a six-month supply should be good enough,” Alvarez said. “Even though the price may be higher for somebody buying it today or next week, I am going based on the prices I paid when we did our bulk order and I didn’t raise the price because my price wasn’t affected.”
But, he added, “Say this lasts longer and I have to do a repurchase of a new size, and I have to pay the new higher tariff price, then obviously, the price for that individual size or product will go up because obviously I have to raise my price when my cost goes up as well.”
The U.S. lacks the infrastructure for “Made in America” auto parts.
Gil added that when it comes to the auto parts sector, it could take time for U.S.-based manufacturers to begin making replacement parts.
If companies decided it made sense for their business model to manufacture parts, it would take major capital expenses ― buying land, building construction and investing in new equipment ― to get things up and running, not to mention time.