A Piper Aircraft spokesperson said last week it was too soon to predict how much the Vero Beach-based company might be impacted by President Trump’s international trade war.
But, she added, if new tariffs remain in place for the long term, Piper will strive to minimize any detrimental effects on the company’s 1,500-employee workforce.
“While it would be premature to speculate on potential impacts, we want to reassure our community that we are fully committed to protecting and supporting our employees to the best of our abilities,” Piper senior marketing and communications manager Alba Walcott told Vero Beach 32963.
“Regardless of external circumstances – whether it be a pandemic, natural disaster or changes in governmental policies – Piper will continue to prioritize the stability and well-being of our workforce as a united Piper family.”
The newspaper inquired about the potential impact on Vero’s second largest private-sector workforce after Piper President and CEO John Calcagno declared that the company, which has been building airplanes in Vero Beach for more than 65 years, is being “financially penalized” for manufacturing its products in the United States.
Calcagno’s remarks were included in a prepared statement the company released in response to Trump’s imposition of tariffs on America’s trade partners, particularly Canada and Mexico.
The escalating global trade war has prompted aircraft manufacturers across the industry to assess the impact of tariffs on their businesses, the March 11 statement read, adding that Piper is “taking proactive steps to support its local workforce on Florida’s Treasure Coast.”
With its employees “at risk of negative consequences if the tariffs persist,” the statement added, the company is “working on multiple fronts” to address the matter.
According to the statement, unintended consequences of the tariffs could include the likelihood that American aircraft manufacturers, including Piper, will be forced to endure increased costs for materials and components, while international-based competitors are not.
“If the tariff situation is not resolved very soon, the long-term impacts could then lead to higher aircraft component costs – specifically, those sourced from Canada, but also by U.S. component suppliers that purchase raw materials from Mexico and Canada,” the statement continued.
Those increased costs, when passed on to aircraft buyers, in turn will lead to higher aircraft prices being unfairly born by only U.S. aircraft manufacturers, such as Piper.
The resulting price increases inevitably would “cause an overall reduced demand for ‘Made in America’ aircraft,” the statement claimed, adding that many international buyers would opt for lower-priced products manufactured in other countries, specifically France and Spain, neither of which are currently subjected to tariffs on parts or sales of their aircraft.
In its statement, Piper stated that while the company continues to embrace its made-in-America legacy and hiring U.S. workers, “changing supply chains in the aviation sector takes time.”
Therefore, the statement added, even though Piper makes 90 percent the parts used in its aircraft “right here in Vero Beach,” substituting a single component part on an aircraft in the company’s current supply chain requires Federal Aviation Administration approval.
That process involves lead times that can take months or years to complete, due to testing and approval programs with “extreme added costs,” the statement read.
Calcagno said Piper is “diligently working all industry and government channels” in its attempt to rectify what the company believes are unintended tariff consequences.
“Piper employs Americans to manufacture aircraft, and, at present, we are being financially penalized for doing so, versus our competitors in Europe that sell their aircraft into the United States free of tariffs,” Calcagno said.
“The negative effects of the current tariff situation on American aircraft manufacturers cannot be understated,” he added. “The constant, daily changes make it almost impossible to run our business.
“Piper has – and will continue to – proactively meet with state and federal congressional leaders to ensure they are fully aware of the regulated nature of aircraft manufacturing and what appears to be unintended consequences of allowing the current tariff situation.”
Meanwhile, a coalition of 15 aviation-advocacy groups are lobbying the Trump Administration in hopes their industry will be exempted from the tariffs.
In a letter written earlier this month to U.S. Transportation Secretary Sean Duffy, U.S. Commerce Secretary Howard Lutnick and U.S. Trade Representative Jamieson Greer, the group urged the federal government to work with industry leaders to minimize the certain disruptions in the aviation supply chain.
The letter states that the aviation-industry supply chain involves “tens of thousands of suppliers from all over the globe” – international companies that provide parts, platforms and systems that require safety approval for installation and use – and most of them cannot be easily or quickly replaced.
“Given this reality, it is essential that both government and industry work together to minimize costs and availability disruptions …,” the letter continues.
“We believe such dialogue and analysis will benefit the competitiveness of the U.S. aviation manufacturing and maintenance sectors and will be critical as the industry continues to innovate and contribute positively to the U.S. balance of trade.”
The letter closed with the coalition’s request to meet with administration officials to discuss the state of the aviation industry and recommendations to move it forward – and for the government to provide an “exception” from any tariff consideration.
The exception would give U.S. aviation manufacturers time to “bolster industry competitiveness and ensure there are no unintended consequences,” the letter concluded.
Among the groups that signed the letter was the General Aviation Manufacturers Association, which counts Piper as a member.
