Buckle Up, Golf Equipment About to Skyrocket with Proposed New Tariffs

I have been fortunate for being in the golf industry for more than 40 years. I can remember when certain products were proudly made in the USA. I got to tour some of the best manufacturer’s facilities including Golf Pride grips in Laurinburg, NC, graphite shaft manufacturers in San Diego, CA, True Temper steel shafts in Amory, MS, and a golf ball manufacturer from the Midwest. They were impressive and full of happy tradesmen and women producing the golf club equipment that perhaps you, your father, mother, or their parents played.

Fact: Majority of Golf Equipment is Manufactured in China Today

Golf club heads have been made in the USA since the 1800’s. However, few modern golf club heads have ever been made in the USA. There was a transition from wooded woods to metal woods and forged irons to investment cast irons in the late 1970’s. Aside from Karsten Manufacturing (Ping®) and Zurn (Lynx), all the cast clubheads were manufactured in foundries located in Taiwan (R.O.C). Those aforementioned brands would later be offshored too. While most golf equipment is manufactured in China today, it was not until around 1990, that first clubhead foundries were moved to mainland China.

Having visited several club head foundries I can attest that it is dirty and hard work. Sad to say, we have a generation of younger people who grew up in the service sector and have never been exposed to manufacturing. I am a realist and cannot fathom them doing the laborious polishing and grinding or even the tedious work of masking and paint filling a club head if one foundry were to magically appear overnight in the USA. However, we would need far more foundries to supply the golf industry.

There is a New Tariff in Town and It Is Going to Increase the Price of Golf Equipment

If you have paid attention to the news and your 401K, I am sure you are aware of the 145% tariff increase (as of this writing) for products made in China. One thing the news doesn’t talk about are the tariffs prior to 2025. Different categories of products are tariffed at different rates.  Prior to the current tariffs, the tariff rate was 11.9% on golf clubs made in China. So the actual current rate is 156.90%, NOT including the cost of freight and miscellaneous fees. Contrary to a lot of the mis-information out there, these tariffs are paid by the importer, that is, the US company.

So how do the new tariffs affect the final price? Let me preface this by saying that pricing varies greatly from company to company. The goals of the company, its marketing strategy/costs, its overhead costs, who or how it’s selling it products will have an effect on final price to the consumer. However, as we will soon see, there is no escaping the added cost of the tariffs.

For the sake of simplicity, we will assume that our example company will 3.5x its landed cost to arrive at its retail price. Now let’s assume that the cost of an assembled cast, carbon crown titanium driver is $135 FOB China; that is, the cost charged by the foundry to the manufacturer prior to shipping. We will also assume that it costs $5 per club to ship this via ocean freight.

We can see that prior to the new tariffs, it cost about $16 in tariffs to import this driver. Our hypothetical company could 3.5x its landed cost to retail this driver for $550. After the new tariffs, it now costs $212 to import this driver. Using the same 3.5x formula, this same driver would now retail for over $1200.

Wowsers! Notice the cost of goods and freight remained unchanged, but the increase in tariffs alone made the cost of a new driver more than double. If you think about it, the tariff rate is much, much higher once the retail price hits the golfer’s credit card.

Golf Bags Have the Highest Tariffs

I mentioned above that different categories of products are tariffed at different rates. Case in point are golf bags. Prior to the new tariffs, golf bags imported from China were 42.6%. With the new 145% tariffs, it is a whopping 187.6%. In another hypothetical example, let us say you have a stand bag that costs $45 from China. Using the same simplified formula as above, let’s see what effect this will have on pricing.

So what options will consumers have if this comes to fruition? People may be holding onto their golf equipment longer, looking at the used club market, seeking equipment from lesser known boutique golf companies or they can build a golf driver from component parts. Yes, you can do that too and it is not hard.

For golf stores and golf clubmaking and repair shops, manufacturers likely still have some inventory in US warehouses prior to the new tariffs, so you may want to stock up so you can weather the storm. While golfers may put a hold on large purchases, they may still want a change to their golf equipment. Regripping and re-shafting is another service that will offer an affordable alternative.

All I can say is hold on to bill of your golf cap. Who knows what the future will hold in a week, month, or year from now. The immediate reality is the cost of new golf equipment being produced today will potentially be significantly higher unless changes are made in this economic environment. Let us all hope so and see you on the golf course.