Tariffs are on and off like a light switch
The lighting industry, which operates on a global scale, is facing a wave of uncertainty due to the introduction of tariffs of varying degrees for various countries. These tariffs affect key lighting manufacturing and distribution hubs, which can lead to increased supply chain costs. Though tariff policies are evolving, here’s how companies and consumers are responding as they navigate the evolving landscape.
U.S. Tariffs on China: What It Means for Lighting Industry
One of the most significant changes affecting the lighting industry is the tariff imposed on imports from China over the last few months. As of May 12, tariffs on Chinese imports that were up to 145% have been paused for 90 days for most goods, but they will likely remain around 30% for now. China is a major supplier of essential components for the lighting industry, including LED bulbs, light fixtures, and critical raw materials like semiconductors.
Lighting manufacturers in the U.S. that rely on Chinese imports have been seeing higher production costs. Many companies choose Chinese suppliers because of their competitive pricing and established supply chains. With the added tariff burden, manufacturers may absorb these increased costs, reduce profit margins, or pass the price hike onto consumers.
In the short term, the tariff may cause supply chain disruptions as manufacturers search for alternative suppliers. Shifting sourcing to other countries may help bypass tariffs, but switching suppliers can be costly and time-consuming, leading to potential delays in product availability.
Navigating the Impact of Tariffs from Canada and Mexico
In addition to China, the U.S. tariffs also affect its trade partners, Canada and Mexico. For goods not covered under the U.S.-Mexico-Canada Agreement (USMCA) trade pact, a 25% tariff on imports from Mexico and Canada remains, with the exclusion of energy and potash.
Many U.S. lighting manufacturers rely on raw materials or finished products from Canada and Mexico. New or prolonged tariffs could push up costs for raw materials and finished goods. Manufacturers may explore reshoring production to the U.S. or find alternative suppliers in countries not impacted by these tariffs.While production costs in the U.S. are generally higher than in many other countries, regional production offers more supply chain stability and shorter shipping times, potentially benefiting both consumers and businesses in the long run.
Steel and Aluminum Tariffs
Steel and aluminum, essential for producing light fixtures, are among the materials that have been impacted by the 2025 tariffs. A 25% tariff on all steel and aluminum imports took effect in March 2025, but a new US-UK trade deal in May touts reducing steel and aluminum tariffs. This is evolving every day.
Lighting manufacturers may have faced increased production costs as a result of these tariffs. This may have led to higher prices for finished products, especially those with metal components such as lamp housings and support structures. Both residential and commercial lighting products could become less affordable for consumers, particularly those sensitive to price increases.
How Consumers Will Feel the Impact
The ultimate effect of these tariff changes will be felt by consumers, who are likely to face higher prices on lighting products. From residential LED bulbs to complex commercial lighting systems, price hikes could be widespread.
The lighting industry has historically been price-sensitive, particularly with the rise of energy-efficient LED technology. As tariffs increase production costs, manufacturers may struggle with finding ways to balance competitive pricing with high quality. Consumers may gravitate toward more affordable options or explore alternative energy-saving solutions that remain cost-effective despite price increases.
Looking Ahead: How the Lighting Industry is Evolving
Overall, the lighting industry is navigating a period of uncertainty due to recent tariff implementation and ongoing changes. Ultimately, how manufacturers and consumers respond to these changes, and if they are temporary or permanent, will determine the future trajectory of the lighting industry. As the global trade environment continues to evolve, it’s clear that adaptability will be key for the lighting industry to not only survive but thrive in the years to come.
Note: This is an evolving topic. This is the latest information at the date of publication.
