Your next Garmin sports watch could cost a lot more after the best-selling brand took a beating from President Trump's tariff policy.
In a recent call with shareholders, CEO Clifton Pemble revealed that Trump's controversial economic strategy will cost Garmin an estimated $100 million in 2025, a sum it aims to recoup with 'mitigations'.
He didn't specify exactly what mitigations these would be, but it's possible they could include a price hike for Garmin's upcoming smartwatches.
"We are not ruling anything out, and we intend to be strategic and selective with these actions," said Pemble.
Any intention to raise prices is likely to become clear in the coming weeks with the impending release of the Forerunner 970.
Last week, we reported the leak of what appears to be Garmin's latest sports watch when eagle-eyed fanatics at Garmin Rumours spotted the Forerunner 970 listed in an Extended Warranty Campaign Application page on Garmin’s Taiwanese website.
This latest high-tech wearable is expected to debut Garmin's latest fitness tech, along with all the bells and whistles of current models.
The previous Forerunner model, the 965, cost $600 (£600) on release, 10% more than the Forerunner 955, which came before it.
What are tariffs?
Tariffs are taxes placed on imported goods, which increase their price and aim to make domestically-sourced products more appealing.
On April 2, President Trump announced a 10% tariff on all US goods, along with additional, and in some cases, substantially higher, tariffs on products from 57 countries. One week later, after a drastic stock market reaction, he announced a 90-day pause on most additional tariffs, but kept the 10% blanket rate.
Garmin watches are primarily assembled in Taiwan, which initially faced a 32% tariff that's now at 10%.
The current $100 million cost estimate depends on Taiwan's tariffs staying as they are. Garmin will face even greater financial difficulty should they return to 32%.
“It's important to note that approximately 25% of our revenue is generated in the U.S. market from products manufactured outside of the US, primarily in Taiwan,” explained Pemble.
“Our assumptions include a 10% baseline tariff on all products manufactured outside of the U.S. including those manufactured in Taiwan.”
The effects of tariffs on the outdoors industry
Garmin isn't the outdoor brand affected by Trump's tariffs. Big names like Black Diamond and Columbia outsource manufacturing to Asian countries, including China, which is still suffering from a 145% tariff.
Facing massive charges, brands are often left with little choice but to raise their prices.
"These tariffs will raise costs for American manufacturers, retailers and families,” explains Kent Ebersole, president of America's Outdoor Industry Association (OIA).
“That’s going to slow growth, put pressure on small and mid-sized outdoor companies and could force some to close their doors. These tariffs also make it more difficult for global outdoor brands to operate in the US and maintain their American workforce."
Logistics expert Will Kogan told Advnture recently: "For US consumers, the effects of these price hikes are becoming increasingly apparent.
"For high-end brands like Yeti, this could impact demand, as consumers might start to opt for more affordable alternatives, especially in a time of economic uncertainty."
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