Tariffs are about to make your AC unit a lot more expensive
As summer nears and states like Texas are already facing extreme heat, tariffs are about to make cooling your home a lot more expensive—and experts don't expect prices to come down any time soon.
The U.S. heating and cooling industry is highly dependent on overseas manufacturers, both for fully assembled units like air conditioners, heat pumps, and HVACs, and for the component parts used to build them. According to the Observatory of Economic Complexity, the U.S. imported more than $15 billion in AC units last year, mainly from Mexico and China.
But according to Aydin Mehr, general manager of the HVAC contractor UniColorado, overseas manufacturers essentially halted production on new units when President Trump announced his tariff plans back in early April, leaving U.S. distributors with an extremely limited supply of heating and cooling appliances. Last week, the Trump administration paused its 145% tariff on China and replaced it with a 30% tariff in the meantime. Now, contractors are reeling from the whiplash of an uncertain manufacturing outlook and dealing with higher expenses across the board.
Mehr says consumers can expect to face both delays and substantially higher prices on AC units and heat pumps this summer. The news comes as a record-breaking heatwave has already hit Texas and some parts of the Southwest, leaving the rest of the nation gearing up for a summer of extreme heat.
Why is my AC getting more expensive?
From a supply chain perspective, Mehr says, there are a few reasons why the heating and cooling industry has been hit particularly hard by the Trump tariffs.
First, he says, around 60% to 70% of completed AC, HVAC, and heat pumps are imported to the U.S. Second, while there are a few manufacturers that do assemble AC units in the U.S., Mehr explains those plants still overwhelmingly rely on component parts shipped from China.
And third, he describes the industry as 'very similar to car manufacturers,' because instead of stockpiling units, distributors anticipate demand based on the season and build their inventories around that. In the case of an unexpected situation like new tariffs, there are no 'warehouses full of appliances' that can be ready to ship.
'When the 145% [tariffs on China] first hit in April, manufacturers stopped producing and distributors stopped importing,' Mehr says. 'No one was importing anything from China. No one was really trying to bypass it. Everyone just stopped to see what would happen. So because of that, there's less units.'
Tariffs on Chinese imports may have dropped, but the 30% tariff still represents a major markup in an industry that relies heavily on Chinese goods, on top of the fact that distributors are working with a majorly diminished supply.
Today, Mehr says, essentially all of the components that go into building an AC unit are more expensive, including steel, sheet metal, and refrigerant. He predicts that, in order to avoid excessive sticker shock, American distributors will slowly increase their prices to offset higher expenses, so that, by the hotter summer months, 'the full weight of the tariffs will be borne by the end customer.'
'My expectation is that prices between now and the end of September will increase at least 10% to 15% at a minimum, on everything,' Mehr says. 'So, if a repair costs 300 bucks today, it will probably cost 320 by then.'
In addition to increased prices on both cooling appliances and associated repairs, Mehr says, there will likely be fewer options for customers to choose from.
'Maybe you could pick from five things today, but probably in a month and a half, you can pick from two or three,' Mehr says. He adds that it's possible the situation might improve by the late summer, when demand dies down, but in the meantime, most distributors don't have much stock to offer. 'It's not a great situation, because the industry isn't really made to have tariffs announced on Twitter: One day on, one day off, one day 145%, the next day 30%—it's not really built to overcome that at all.'
Bad news for a hot summer
This isn't the first time that the heating and cooling industry has been impacted by tariffs. Back in 2019, President Trump imposed a 10% to 25% tariff on Chinese imports, which had a similar ripple effect across the supply chain—a situation that was only exacerbated by the pandemic.
Since then, though, prices have only continued to rise rather than returning to pre-2019 levels. Mehr expects the hikes brought on by this most recent round of tariffs to become the new normal for distributors.
'If someone has had an upgrade or major repair in mind, they should act on it soon, because even if tariffs are eased, all of these existing price increases are not going away,' Mehr says. 'Being in this industry, I have never seen prices of anything go back down. When manufacturers raise it, it rises forever.'
The price jumps come as climate change continues to drive extreme summer temperatures. Last summer, people around the world experienced 41 extra days of dangerous heat due to climate change, a trend that was both dangerous and expensive, given the mounting electricity bills needed to stay cool.
And now, Texas is already experiencing a heat wave that has seen temperatures rise above 100 degrees in mid-May, causing electricity use to surge to a new May record of over 78,000 megawatts, according to the Electric Reliability Council of Texas.
Per a recent study from the National Energy Assistance Directors Association, residential electricity costs are forecast to average $784 this summer, up 6.2% since last year. Paired with rising appliance costs and maintenance fees, that means AC could become prohibitively expensive for many Americans.
And this isn't just uncomfortable: It can be deadly. Heat is the leading cause of weather-related deaths in the U.S., killing more people than hurricanes, floods, and tornados. It can also exacerbate health conditions, impact people's sleep, and contribute to cognitive issues.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
23 minutes ago
- Yahoo
Sword Health Now Valued At $4 Billion, Announces Expansion Into Mental Health Services
Sword Health announced Tuesday that it had raised $40 million in a recent funding round, giving it a $4 billion valuation. Founded in 2015, the healthcare startup has focused on helping people manage chronic pain at home. Using AI tools, the platform connects users with expert clinicians who then provide patients with tools for digital physical therapy, pelvic health, and overall mobility health. However, the company says this new round of funding will largely go towards developing a mental health arm of its program called Mind. Don't Miss: Maker of the $60,000 foldable home has 3 factory buildings, 600+ houses built, and big plans to solve housing — Peter Thiel turned $1,700 into $5 billion—now accredited investors are eyeing this software company with similar breakout potential. Learn how you can "Today, nearly 1 billion people worldwide live with a mental health condition. Yet care remains fragmented, reactive, and inaccessible," Sword said in the announcement. "Mind redefines mental health care delivery with a proactive, 24/7 model that integrates cutting-edge AI with licensed, Ph.D-level mental health specialists. Together, they provide seamless, contextual, and responsive support any time people need it, not just when they have an appointment." Sword CEO Virgílio Bento told CNBC, "[Mind] really a breakthrough in terms of how we address mental health, and this is only possible because we have AI." Users will be equipped with a wearable device called an M-band, which will measure their environmental and physiological signals so that experts can reach out proactively as needed. The program will also offer access to services like traditional talk therapy. Bento told CNBC that a human is "always involved" in patients care in each of its programs, and that AI is not making any clinical decisions. Trending: Maximize saving for your retirement and cut down on taxes: . For example, if a Sword patient has an anxiety attack, AI will identify it through the wearable and bring it to the attention of a clinician, who can then provide an appropriate care plan. "You have an anxiety issue today, and the way you're going to manage is to talk about it one week from now? That just doesn't work," Bento told CNBC. "Mental health should be always on, where you have a problem now, and you can have immediate help in the moment." According to Bento, Sword Mind already has a waiting list, and is being tested by some of its partners who appreciate it's "personalized approach and convenience." "We believe that it is really the future of how mental health is going to be delivered in the future, by us and by other companies," he told CNBC. "AI plays a very important role, but the use of AI — and I think this is very important — needs to be used in a very smart way." The rest of the cash raised in the funding round, which was led by General Catalyst, will go towards acquisitions, global expansion, and AI development, Sword Health says. Read Next: Here's what Americans think you need to be considered Shutterstock UNLOCKED: 5 NEW TRADES EVERY WEEK. Click now to get top trade ideas daily, plus unlimited access to cutting-edge tools and strategies to gain an edge in the markets. Get the latest stock analysis from Benzinga? APPLE (AAPL): Free Stock Analysis Report TESLA (TSLA): Free Stock Analysis Report This article Sword Health Now Valued At $4 Billion, Announces Expansion Into Mental Health Services originally appeared on © 2025 Benzinga does not provide investment advice. All rights reserved. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
26 minutes ago
- Yahoo
Top Cryptocurrencies Fall; Bitcoin Hovers Above $103,000
Major digital assets fell Friday with Bitcoin (BTC-USD) hovering above $103,000. The CoinDesk Mar Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Yahoo
26 minutes ago
- Yahoo
Tulsi Gabbard Flips Sides in MAGA Civil War Over Iran's Nuclear Capabilities
Director of National Intelligence Tulsi Gabbard has flipped her stance on Iran after President Donald Trump nuked her intelligence as 'wrong.' Gabbard told the Senate Intelligence Committee on March 25 that there was no intelligence to suggest Iran was building nuclear weapons, though the country had enriched its uranium to higher levels. Following Israeli Prime Minister Benjamin Netanyahu's June 12 'preemptive' strike on Iran—which he justified by saying that the country has a 'secret plan' to weaponize uranium—Trump sided with Israel's countervailing position. On two separate occasions this week, Trump rebuffed Gabbard's earlier assessment of Iran's nuclear program. 'I don't care what [Gabbard] said,' Trump said aboard Air Force One. 'I think they were very close to having one.' In another comment on Wednesday, the president added that Iran was 'a few weeks' away from turning their uranium into a weapon, echoing similar sentiments shared by Netanyahu. Then on Friday, Gabbard fell in line with Trump, attacking the media for having the gall to believe what she said. 'The dishonest media is intentionally taking my testimony out of context and spreading fake news as a way to manufacture division,' Gabbard wrote to her 600K followers. 'America has intelligence that Iran is at the point that it can produce a nuclear weapon within weeks to months, if they decide to finalize the assembly.' She added, 'President Trump has been clear that can't happen, and I agree.' Gabbard included a clip of what she called her 'full testimony,' which has since racked up 8.9 million views. The world has been thrown into a state of limbo while Trump weighs a decision on whether to get the United States involved in strikes on Iran, a decision the country warned would be 'very dangerous.' In a statement read on Thursday by White House Press Secretary Karoline Leavitt, Trump said he would make his decision 'within the next two weeks' based on the fact that there 'is a substantial chance of negotiations that may or may not take place with Iran in the near future.' Reuters reported that the Iranian Foreign Minister Abbas Araghchi met with a group of European diplomats in Geneva on Friday for nuclear talks.
