Automotive accessory maker Thule is facing a double whammy from U.S. tariffs on Chinese exports. Firstly it has to pay duties on its imports from China. Group CFO Lennart Mauritzson stated that the firm’s lower reported profitability in 3Q was “driven by the negative effect of impact of the Chinese tariffs for U.S. purchased goods added approximately 0.2 percentage points“.

Second the firm has suffered an indirect impact on its sales of bicycle racks with the company financial statement indicating that the “U.S. market declined 6% in the quarter – additional tariff decisions/speculations increased uncertainty among retailers and less consumer purchases, affecting our key categories“

Panjiva’s data shows that U.S. seaborne imports associated with Thule fell by 3.8% year over year in 3Q. That followed a 3.7% decline in 2Q, suggesting tariff pressure is increasingly becoming a business-as-usual issue for the firm.

At the product level the firm has seen a mixed impact. There’s been a marked downturn in imports of hardware with shipments of bike racks and other hitch attachments down by 54.7% year over year in the 3Q while imports of trailers halved. On the other hand shipments of boxes and bags have surged 47.2% higher.

Chart segments U.S. seaborne imports associated with Thule by product (HS-4) on a monthly and three-month average basis.  Source: Panjiva

 The firm may have started to restructure the origins of its U.S. imports. Shipments from China, including Hong Kong, were equivalent to 50.8% of the total in 3Q 2019, down from 65.0% in the same period a year earlier.

That’s been offset by a rise in imports from Vietnam to reach 15.5% of the total from 7.6% a year earlier. The firm has also scaled up its imports from the rest of the world, including Europe, to reach 33.8% of the total from 27.4%. 

Chart segments U.S. seaborne imports associated with Thule by origin on a monthly and three-month average basis.  Source: Panjiva