PC Case Maker CaseLabs Closes Permanently (pcgamer.com)

U.S.-based PC case manufacturer, CaseLabs, announced on social media that it is "closing permanently" and will not be able to fill all current orders. "We have been forced into bankruptcy and liquidation," CaseLabs said in a statement. "The tariffs have played a major role raising prices by almost 80 percent (partly due to associated shortages), which cut deeply into our margins. The default of a large account added greatly to the problem... We reached out for a possible deal that would allow us to continue on and persevere through these difficult times, but in the end, it didn't happen." PC Gamer reports: CaseLabs is likely referring to the growing number of tariffs being enforced on Chinese imports by the United States government. China and the US are currently engaged in a trade war, causing many U.S. companies to lose money, lay off employees, or close entirely. CaseLabs went on to say that it won't be able to fill the backlog of case orders, but other parts will most likely ship to customers. "We are so incredibly sorry this is happening. Our user community has been very devoted to us and it's awful to think that we have let any of you down."

Comments

Not *just* due to tariffs

[Anonymous Coward]

FT company website:

"We are very sad to announce that CaseLabs and its parent company will be closing permanently. We have been forced into bankruptcy and liquidation. The tariffs have played a major role raising prices by almost 80% (partly due to associated shortages), which cut deeply into our margins. The default of a large account added greatly to the problem. It hit us at the worst possible time. We reached out for a possible deal that would allow us to continue on and persevere through these difficult times, but in the end, it didn’t happen.

Blame the business owner, not the tariffs.

[Anonymous Coward]

The tariffs have played a major role raising prices by almost 80 percent (partly due to associated shortages)

The ten percent aluminum tariff causes prices to spike eighty percent? Sounds like CaseLabs' suppliers ripped them off.

The default of a large account added greatly to the problem... We reached out for a possible deal that would allow us to continue on and persevere through these difficult times, but in the end, it didn't happen.

So, CaseLabs got ripped off by a client. This was a business failure, not a tariff problem. That's confirmed by the company's failure to secure financing to continue: even the bank knew that the owners sucked at running a business.

They made overpriced cases (seriously, $600 for a case?) and ran their business badly. They failed.

Re:Can Someone Explain?

[narcc]

The tariffs are designed to help American manufacturing, they make American products cheaper than foreign products.

In the same way that killing everyone smarter than you will make you the smartest person in the world.

Tariffs don't make US products cheaper, they make foreign products more expensive.

It's bias in the media

[Solandri]

China and the US are currently engaged in a trade war, causing many U.S. companies to lose money, lay off employees, or close entirely.

The way the media portrays it:

If a trade policy is implemented by a Democrat:

• Open trade is good for the economy.
• Tariffs protect American jobs by preventing them from being sent overseas.

If a trade policy is implemented by a Republican:

• Open trade causes American jobs to be sent overseas.
• Tariffs cost American jobs by stifling the economy.

The reality is that both are true. The press just likes to spin it in favor of or against the party in power.

• Open trade causes American jobs to be sent overseas (assuming there are foreign countries with a lower standard of living than the U.S., which means they have lower labor costs). But the increased economic activity due to imported goods being cheaper than domestic goods results in a net boost to the domestic economy and the standard of living in the U.S.
• Trade tariffs protect American jobs from being sent overseas. But do so by increasing the price of goods sold in the U.S., resulting in a net decrease to the domestic economy and the standard of living.

The tariffs are designed to help American manufacturing, they make American products cheaper than foreign products

Nope. They're designed to help American manufacturing by making foreign products more expensive than American products. That is, they protect American jobs, but do so by making the products you buy more expensive.

That's why I generally fall on the pro-open trade side of this. It's a Prisoner's dilemma situation, where if one side implements tariffs, they get a better result than open trade, while the other side gets the worst possible result. But if both sides implement tariffs, they both end up worse off than with open trade. The best solution for both sides overall is open trade.

Trump's rationale (which I partly agree with but mostly don't) is that China has been abusing our policy of open import of Chinese goods by restricting export of American goods to China and/or subsidizing some of their goods which the U.S. imports which artificially kills off U.S. producers, thus giving China the advantage in the Prisoner's dilemma (and puts the U.S. at a disadvantage). The best solution found thus far to the iterated Prisoner's dilemma is the tit for tat strategy. If one side abuses the Prisoner's dilemma, the other side abuses it right back thus signaling that it won't take such abuse lying down. And eventually the side which started the abuse backs down, and the other side also backs down, reverting both sides to the best possible strategy for both (in this case, open trade).

On the subject of steel

[quonset]

One thing everyone here is missing is that U.S. Steel and Nucor Steel have been fighting every single exemption request companies have put forth to the U.S. Commerce Department. These companies want exemptions from the tariffs so they can continue to get steel at reasonable prices and/or quality and type they need.

Instead, the two largest producers of steel in the country have raised their prices and told the Commerce Department the exemptions are bogus because they can make the product, even though in at least one case, a company stopped buying steel from U.S. Steel because of quality control issues.

Of course politics plays a big role in all this:

Charlotte-based Nucor, which financed a documentary film made by a top trade adviser to Mr. Trump, and Pittsburgh-based United States Steel, which has previously employed several top administration officials, have objected to 1,600 exemption requests filed with the Commerce Department over the past several months.

To date, their efforts have never failed, resulting in denials for companies that are based in the United States but rely on imported pipes, screws, wire and other foreign steel products for their supply chains.

In one case, a company stated “the sole U.S. producer of high speed steel material appropriate for cutting tools is not currently ramping up any production to expand this aspect of their business and has not shown any interest in quoting new business.”

As the tariffs take hold, expect prices of finished goods to rise substantially and more businesses to either go under or relocate out of the country. The largest nail manufacturer in the country has already laid off 12% of its workforce, cut hours for the remainder and is still on the brink of extinction, so it has to make such a decision.