CaseLabs, the California-based PC case maker with a reputation for premium build quality, announced on Saturday that it will be closing its doors permanently. Additionally, it won't be able to ship its entire backlog of existing orders.
The company made the announcement on social media, including Facebook and Twitter, as well as on the top of its website. CaseLabs wrote that " [w]e have been forced into bankruptcy and liquidation," and suggested that "[t]he tariffs have played a major role raising prices by almost 80% (partly due to associated shortages), which cut deeply into our margins." Additionally, the statement mentions the "default of a large account."
The company closure could mean the loss of more than a dozen US jobs.
"We had about 22 employees at the start," CaseLabs president Jim Keating told Tom's Hardware over email. "We’re now down to 16. Some have been with us for 15-20 years or more. They are all at our Canoga Park facility [in California]. It’s an awful situation."
When asked about the tariffs, however, Keating said that "[m]ost of the information I have around the tariffs have been provided by our material distributors, so I can’t confirm the accuracy of it, but believe it to be true."
Keating suggested that the tariffs began affecting the company in January. That tracks with announcements by the Trump administration, as well as when tariffs began on solar panels and washing machines. According to the Washington Post, steel and aluminum prices both increased dramatically afterwards. Keating said that CaseLabs materials went from a "high $1.50s per pound" in the fourth quarter of 2017 to "mid $2.80s now." Tom's Hardware reached out to the White House for comment on tariff effects on US companies, and we'll update this story if we hear back.
There was a last-ditch effort so save the company that failed The company's statement mentions a "possible deal" that could have saved the company. CaseLabs was considering some outsourcing and downsizing to save itself.
"I can’t say much about the deal except to say that it was a company in Europe with their own manufacturing resources," Keating said. "The US facility would have been downsized, but kept operating to fill custom case orders for law enforcement and other government agencies. Unless another company steps in, we will move ahead with liquidation."
The company said in its statement that it is attempting to ship as many orders as possible, but that the company won't be able to fulfill all of them. Parts should all ship.
The administration is still moving forward with more tariffs, including transistors, circuit boards, flat panel displays and more, which could have broader effects on the PC industry.
But as you said, 'more of a story'.
Or maybe I'm supposed to believe that $20 increase in the raw material for a $500+ "premium" case is to blame... righttttttt, not drinking that koolaid! The material cost are a fraction of the labor, and when building "premium" custom cases, I would suspect the actual split is something like 20/80 material/labor, and tariffs dont affect the labor, so again, BS!
Maybe try moving out of one of the highest taxed, heaviest regulated states in the country and I bet you could cut your labor and overhead cost WAY more than the tariff increases in material and turn a bigger profit.
EXACTLY!!! Foxconn, the largest US economic development in DECADES, let alone the single largest technology development in US history EVER is coming to Wisconsin, is going to create 13000 direct jobs at the main plant in the first few years, and there hasnt been a single article about it. Maybe its because this was a direct result of Trump, Walker, and conservative policies; but but but a "drive-by" story of 20 jobs lost and some CEO's unfounded-claims and blaming Trump does make an article... bias much?
Dantte you should know that the plant you are talking about is already being changed in type. Walker expected a Gen 10.5 plant as that is what he was shown by Foxconn in China, however, the plans have been changed to a Gen 6 plant. That is a much smaller facility with a lot less employees. Don't forget that with 13,000 employees it was going to take 20 years to recuperate the $3 billion in incentives being given to Foxconn, however, now that number is $4.5 billion and fewer employees. That means it will take 30+ years to recuperate that money now. No this isn't dealing with Walker, Trump, etc... politics and economic policies. This deal with the company closing is becoming a common trend with the tariffs.