December 6, 2024

Hockey Gear Is the Focus of a Tariff Cut in Canada

Just about the only thing Canadian about buying hockey equipment in Canada has for years been the tariff on imported goods. Now, even that quirk of Canadian hockey history is going away.

On Thursday, the finance minister, Jim Flaherty, announced that the Conservative government would end import tariffs on all sports equipment, except bicycles, on April 1. The tariffs were as high as 18 percent.

Usually, changes to tariff policy are more the concern of budget directors and accountants, but this change has become a national obsession, with the focus almost entirely on hockey equipment.

Even before it was officially announced, the end of the tariff was cast by the Conservatives’ opponents as more of a political than an economic measure.

In the budget, the government said the end to the duties came “with an expectation that wholesalers, distributors and retailers will pass these savings on to consumers.”

But exactly how much the move will save Canadian hockey players or, more likely, their parents is unclear.

Sitting in the stands of the Brewer Arena, a community rink in Ottawa, while his 11-year-old son’s team practiced for a tournament, Brendan McCoy said that the tariff change would not improve his family’s fortunes.

“The big cost is the ice time,” Mr. McCoy said, noting that much of his son’s gear was bought secondhand. “Equipment, at most, is a couple of hundred dollars every couple of years. If the government thinks it’s going to get my vote with this, it’s seriously mistaken.”

What was clear on Thursday is that the announcement highlighted what had become a quiet source of embarrassment to the many devotees of Canada’s game, or as some see it, Canada’s national religion: that very little hockey gear is produced here.

The aisles at Pro Hockey Life provided many examples: a wall of gloves made in China for Reebok (a unit of Germany’s Adidas) and in Vietnam for C.C.M. (another Adidas operation) faces off against gloves from China bearing the logos of Bauer (Canada-based but run from New Hampshire) and Easton (owned by Easton Bell Sports of Van Nuys, Calif.). There were also imports from the Philippines sold by Sher-Wood (privately and Canadian-owned).

A selection of skates sprawled across the back of the store. But the only Canadian-made models were priced from $500 to $600 a pair and came from Graf, a skate maker whose headquarters are in Switzerland.

“About 90 to 95 percent of hockey equipment is made in Asia,” said Richard Desjardins, the product manager at Sher-Wood, which is based in Sherbrooke, Quebec. “Everybody knows it. Made in Canada might have been important 10 years ago. But now it’s all about how much you pay.”

Sher-Wood ended production of protective equipment over 10 years ago and outsourced its entire production of sticks, its signature product, two years ago to China and Ukraine. Mr. Desjardins said that it only added maple leaves or the slogan “designed in Canada” to products sold in Europe, the last place where a Canadian connection still had marketing power.

The government’s decision to eliminate tariffs that were protecting a largely nonexistent industry seems to have more to do with online shopping and the rise of the Canadian dollar to parity with its American counterpart.

For example, many of the skates at Pro Hockey Life priced from $500 to $700, a surprisingly large category, are available from American online retailers at prices that are at least $100 lower because of low tariffs in the United States.

“We appreciate that there’s a pricing differential between Canada and the United States,” said Kevin M. Davis, the president and chief executive of Bauer Performance Sports. He added that his company was likely to reduce its wholesale prices, but that “we can’t control what happens with retail pricing.”

Bauer, which was once owned by Nike, and Reebok-C.C.M. Hockey are by far the dominant equipment makers in the Canadian hockey market. At both companies, Canadian production is now limited to relatively small numbers of custom-made skates for professional players and affluent amateurs. Similarly, a handful of small producers, like the goalie pad maker Vaughn, serve the high end of the market.

As for why it took Canada so long to adjust its tariffs to reflect the changes in the hockey equipment business, Mr. Desjardins was uncertain.

“It’s been in the tariff code for a long time,” he said. “Maybe they just overlooked it.”

All is not lost for the Canadian hockey equipment industry: the humble puck, with its 5.6 ounces or so of vulcanized rubber, is still produced at home.

Article source: http://www.nytimes.com/2013/03/22/business/global/hockey-gear-is-the-focus-of-tariff-cut-in-canada.html?partner=rss&emc=rss