Competing based on price alone in the global marketplace doesn’t serve many American manufacturers well, something one of New York’s U.S. senators hopes to change.
Rhino Equipment Sales and Service at 99 Cordell Road in Schenectady makes presses, feed systems and circuits.
The company, which exports to Canada, Mexico and as far away as Australia says it joins other manufacturers in the region facing a significant cost disadvantage because of exports to countries like China, which has suppliers taking advantage of currency manipulation to provide artificially cheap goods.
“We do compete against them. It’s hard,” said Keith Goodman, Rhino operations manager. A typical piece of equipment that Rhino may sell for $50,000 faces a Chinese competitor who may sell a comparable item for $7,500, he said.
Rhino said its customer base in the automotive and packaging industry tends to lean toward inexpensive suppliers.
“It does have an effect on us,” Goodman said.
U.S. Sen. Chuck Schumer, D-N.Y., is advocating for legislation designed to level the playing field for Capital Region manufacturers.
“We are sending a message to the Chinese government: If you refuse to play by the same rules as everyone else, we will force you to,” Schumer said in a statement. “There is no bigger step we can take to promote U.S. job creation, particularly in the manufacturing sector, than to confront China’s currency manipulation. This is not about China-bashing; it’s about defending the people of New York and of the United States.”
The Currency Exchange Rate Oversight Reform Act of 2010 would take steps to identify countries that are manipulating their currency and establish penalties.
The current legislation has 16 bipartisan cosponsors and furthers Schumer’s previous efforts to pass China trade legislation, which died in the House of Representatives. Schumer’s office said the current bill “combines several separate bills into a single, strong bill that can pass the Senate and the House.”
Schumer made an announcement about the new legislation Wednesday at Simmons Machine Tool Corp. in Menands, a company that like Rhino faces increasing competition due to price pressures from foreign goods. Countries that manipulate their currency exchange rates can lower the price of their exports and have a trade advantage over U.S. manufacturers.
Companies like Rhino compete with service and quality to make up for price differences.
“The equipment they make similar to us is very inexpensive. But then again it’s not supported and you can’t get replacement parts for it,” Goodman explained. “Our stuff is guaranteed for 18 months, with 3,000 [labor] hours. They guarantee for 90 days.”
The manufacturing sector in the Capital Region has declined by 28 percent over the decade as 10,000 have been cut from payrolls.
Overall, the U.S. has lost 5.3 million manufacturing jobs since 2000, of which 300,000 were in New York state.
“The No. 1 issue for the people of New York is jobs and bringing back our economy. Getting the Chinese government to play by the rules of our economic system would be a huge step forward towards securing our economy and the manufacturing jobs of New Yorkers. It’s vital that we get this done,” Schumer said.