This week’s update has a tariff summary, the unloading of our shipping container, a reminder to send in your address for Batch 2 and Batch 3, and the announcement that we will be selling some extra kits tomorrow at 10am Seattle time.
Sorry to hear about the tariff charges, that’s a lot! Is China still the cheapest or would Vietnam or Philippines be a better option. Are you still able to keep the price down near the Kickstarter price when you start full production?
It’s a good question. I haven’t found a high quality manufacturer of the kind of motors that we use outside China and those are the big ticket item in the kit.
The electronics are interesting because they’re also expensive because it’s the components which are 90% of the cost there and they are mostly made in the US and Europe (Texas and Austria) but then they are assembled in China so it count’s as a Chinese product.
I think that a lot of companies try to get around tariffs by using an intermediary country to do the last step of the process and then they can claim that country is the country of origin.
We’ll have to look into it to see what we can do to keep the cost down, but generally speaking I’d like to try to follow the law and not find a work around. If the highest quality parts come from China then that’s where we’ll get them.
Ha, I think I was order #2 today, if I am reading the order number correctly. AWESOME! I missed the kickstarter event so I was so happy to hear that extras were ordered for batches two and three. Thanks!
Thanks for the order! It feels really good to know that people other than me are excited about it … I was a little worried that nobody would buy them and that after the Kickstarter everyone would have forgotten
I spent most of the second half of my career manufacturing in Asia (mainly China) and back in 2018 or so had the tariffs completely upend my manufacturing strategy.
What is often done, and is perfectly legal, is to source less than 50% by value of your product in China, and finish manufacturing and assembly in a third country, often Malaysia, although Mexico is also becoming popular. I am working with factories in Malaysia and Mexico right now.
As long as less than 50% oof the value derives from China, your product is considered not to have been manufactured in China, and you don’t have to pay the tariffs. Malaysian factories are coming up to speed on this rapidly.
The calculation of value includes labor and other costs as well as materials, and can get tricky (to what country does the transportation costs between countries belong for example.).
I’ve ordered my kit and am looking forward to setting it up.
Happy to help with anything related to Asian manufacturing.
That’s good to know that Malaysia is becoming a good option. We were thinking about looking into Mexico as a future option. It’s something that we’re going to consider carefully down the road.
What is your experience with part quality from other places? I’ve found that the Chinese factories especially for motors really have it dialed in and the quality is hard to beat.
I would try to stick with China sources for motors for the reasons you mention, especially if you can get the China content below 50%. You may be able to find good motors from other countries but it could take some searching. One thing to do is see if your current motor manufacturer has facilities in other countries and could ship the motors from there to wherever your final assembly operation is. Many Chinese suppliers are expanding into other countries to support the US market and still be competitive on price.
A big challenge is that because the supply chains for so many component parts are in China, that it can be a struggle to keep China content below 50%. If you have your PCBs made in Vietnam for example, many of the components on the boards will have come from China and that has to be taken into account.
Happy to get on a Zoom call or equivalent and cover all these things.
I would love to take you up on that. We’re pretty committed to the current plan right now to get these Kickstarter kits out as soon as possible, but I would absolutely love to learn from you about what we could do better long term.
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… I was a little worried that nobody would buy them and that after the Kickstarter everyone would have forgotten 
