As President Donald Trump’s tariffs continue to run roughshod over the economy, one local company has gone into survival mode to weather the storm. Kyle Ranson, CEO of southeast Portland-based apparel company Showers Pass and founder of electric bike brand Vvolt says he may be forced to close as the weight of tariffs suffocate his business.
“Obviously we’re going to hold as long as we can. But basically it’s a complete holding pattern,” Ranson shared with BikePortland this morning. As just one example of the existential crisis his business faces, Ranson said he’s got a shipment worth $1 million waiting at a port in China that would cost him about $1.2 million just to clear customs. When I first reached out to Ranson, he lamented that the shipment would cost him $680,000 in tariffs. But that cost doubled overnight as the trade war has escalated. (Typical customs duty on a $1 million shipment would be around $20,000.)
“It’s preposterous. It’s impossible,” an exasperated Ranson shared.
Ranson said small and medium-sized business like his do not have the free cash flow needed to pay those kind of costs. “We’re all operating tight already. We’re managing every dollar. There are no businesses in the small to medium size range that will have the cash-flow to pay these tariffs. It’s just… it’s just impossible. I mean, literally, on our on our e-bike business, we’re now talking about 154% tariffs.” Ranson also works with a factory in Vietnam, where tariffs have jumped to 46%. This is all such a shock to the system because last year at this time there were zero import duties on e-bikes.
According to a well-sourced article published yesterday by Heatmap, the bicycle industry is one of the most import-dependent industries in the U.S. Bike industry experts are forecasting a very grim future for many companies like Showers Pass and Vvolt if things continue on this trajectory.
For now, Ranson has told shippers to hold his cargo. That means his plan is to sell existing inventory as long as he can, but he’s still got payroll and other fixed costs bearing down on him (including, somewhat ironically, payments on a federal SBA loan). Two months ago Ranson shifted employees to a four-day work week. He’s also frozen salaries and shelved plans to hire more staff. Despite difficult conditions, Vvolt and Showers Pass employees are just as committed to survival as Ranson is. “They’ve said, ‘We’re all in. Let’s figure this out,’ and that is so heartening. It makes me realize why I’m doing this in this first place.”
“What we’re not doing is giving up,” a resolute Ranson said this morning. “We’re looking under every rock, we’re scrambling, and we’re watching out for doors to open.”
But the clock is ticking without any new products coming in. It’s like a “ticking time bomb,” Ranson says.
Sales of Showers Pass products dipped significantly last week, due to what Ranson thinks is a general “paralysis” in the market. Even his largest customers like REI have reduced orders. Now it’s a matter of belt-tightening and playing the waiting game.
As for whether or not Trump’s tariff policy will encourage Ranson to bring Vvolt bicycle production to America, that’s a sore subject. Since Vvolt launched in 2021, Ranson said the vision was always to do assembly in the U.S.; but he’s received no government support to make that happen. And now with tariff costs, it’s impossible since none of the components on the bicycles are made in the U.S.
“If you want us to do this final assembly, which we believe is viable and can be done, you’ve got to give us a duty break on bringing in the components,” Ranson said.
With so much uncertainty, Ranson says it’s hard to even know how to react. For now, the plan is to sell through existing inventory and hope that provides enough cash flow to survive. There are no plans to raise prices on current inventory, and Ranson says if customers are feeling sympathetic, the best thing they can do is make a purchase. “Show us some love, because the only thing that’s going to keep us going is selling what we’ve got.”
“We’re going to keep the doors open until the government figures out what the hell they’re going to do. But if we start running out of product and we don’t have the cash for payroll and everything else. That’s when, you know, it’s lights out.”
