American Keg Company Announces Layoffs Due to Trump Tariffs

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American Keg Company Announces Layoffs Due to Trump Tariffs

Photo Credit: VinePair & Michael Candelori / Shutterstock.com

The only American manufacturer of steel kegs has been hit hard by recent tariffs from the Trump administration, according to the Wall Street Journal.

American Keg Company, based in Pottsdown, Pennsylvania, produces the 15.5-gallon steel kegs familiar to anyone who has worked at a bar or attended a college party, but bars and parties aren’t enough to keep profits high after the Trump administration recently passed new tariffs on steel. The company recently laid off a third of its workforce.

Trump announced the new tariffs on imported steel (25 percent) and aluminum (10 percent) earlier this month. Some steelworkers initially celebrated the decree, thinking it would benefit their industry. Others, however, immediately recognized their threat to American business.

“I worry about the people here,” American Keg owner Scott Bentley told CBC News following Trump’s announcement.

His concerns proved prescient. In the aftermath of the tariffs, American Keg CEO Paul Czachor laid off 10 of the company’s 30 workers. A CNN Report estimates that overall American job losses from the tariffs could range from 90,000 to 150,000.

Since Trump took office, prices for American raw steel are up by more than 35 percent, according to data from S&P Global Platts. The tariffs make it more expensive to manufacture steel kegs in the U.S. than to buy imported versions.

Kegs made in and imported from China, for example, are not affected by the tariff. They retail for around $95. American-made versions are approximately $115, according to WSJ.

“When a Chinese keg delivered to America costs only a little more than what we pay for just the steel, there really is no point in trying to compete on that basis,” Bentley said earlier this month.

Steel prices rose by 4 percent the day Trump approved the tariffs on March 8, 2018. As we previously reported, these tariffs also affect price of aluminum cans, an increasingly popular vehicle for craft beer, wine, and even cocktails.


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