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On a recent December day, Mark Latino and his team at Lee Display were busy turning sheets of vinyl into glittering tinsel, a process performed on a custom-built, nearly century-old machine.
This Fairfield, California-based company, founded by Latino’s great-grandfather in 1902, is now one of the few companies left in the United States that still manufacturesartificial christmas treeProduces approximately 10,000 annually.
However, this year the festive glow is fake a Christmas tree This has been dimmed by the flickering light of tariffs, exposing America’s deep dependence on foreign production for its plastic fir. The new import taxes have increased the prices of artificial trees by 10 to 15 percent, according to American Christmas Tree AssociationForcing sellers to cut orders and bear higher costs.
Despite these financial pressures, a significant shift back to mass production in the US is unlikely, even after decades of manufacturing in Asia. Chris Butler, CEO of National Tree Company, which sells more than one million artificial trees annually, explained that fake trees are inherently labor-intensive and require components, such as holiday lights, that are not easily produced in the US.
Additionally, American consumers are highly price sensitive when it comes to holiday decorations. “Putting a ‘Made in USA’ sticker on the box won’t do any good if it’s twice as expensive,” Mr Butler said. “If it’s 20 percent more expensive, it won’t sell.”
The preference for artificial trees remains strong among US residents, with nearly 80 percent choosing fake trees this year – a figure that has remained consistent for at least 15 years. Balsam Brands founder and CEO Mac Herman said many Americans prefer artificial trees because they can be installed earlier and left for weeks without drying out, unlike fresh-cut trees. Others choose these because of allergies to the mold spores found on real trees.
Convenience also plays a major role, with 80 percent of the fake trees sold annually having pre-strung lights, a labor-intensive task that drove production away from the US, first to Thailand in the early 1990s and then to China a decade later. Mr. Harman questioned, “Where are we going to get 15,000 people in America who want to put lights on Christmas trees?”
The process of building an artificial Christmas tree, from molding the needles to tying branches and adding lights, typically takes one to two hours. In China, where 90 percent of fake trees are made, workers are paid between $1.50 and $2 an hour. Mr. Herman described the efficiency of the workers wrapping lights on the trees at Balsam Hill as “like watching an Olympian.” Some of Balsam Brands’ Chinese partners employ 15,000 to 20,000 people, with some in Indonesia employing another 10,000, many of whom are seasonal workers.
During the first Trump administration, when President Donald Trump threatened tariffs on imported Christmas decorations, Balsam Brands, based in Redwood City, California, explored the feasibility of manufacturing fake trees in Ohio. Despite hiring consultants and considering automation, the company concluded that a tree currently retailing for $800 would be worth $3,000 if made in the US. Mr. Herman even said that Balsam had to struggle to find an American company to produce the simple pair of gloves included in each box for fanning the branches.
Back at Lee Display, Mark Latino praises the control and speed of the domestic production. He commented, “You have more control over this. I like to think that everything that happens here is either my fault or my mistake or my careful planning and skill.”
However, this US manufacturer also felt the brunt of the tariffs. Latino’s son, James, who handles business development, confirmed that the company avoided importing lights or decorations from China this year, instead relying on existing stock. Due to reduced supply, they expect import costs to increase next year.
In response to the tariff scenario, some artificial tree companies are diversifying their supply chains to reduce dependence on China. For example, National Tree Company moved some manufacturing to Cambodia in 2024 and could potentially source all of its trees from outside China by next year.
Still, this diversification has not immunized companies. In April, the Trump administration threatened a 49 percent tariff on Cambodian products, which was later reduced to 19 percent. Duty on artificial trees from China has fluctuated but now averages 20 percent.
Mr. Butler of the National Tree Company reported a 10 percent increase in prices this year due to importing fewer trees and using most of the extra revenue for customer rebates due to weak demand.
“It’s a discretionary item. People say, ‘I can wait another year,'” he explained. Balsam Brands absorbed the tariff impact by cutting its workforce by 10 percent, canceling travel, freezing pay raises and even halting weekly office lunches, along with 10 percent price increases.
Mr. Herman said U.S. sales have declined 5 to 10 percent this year, while those in Germany, Australia, Canada and France have increased 10 percent or more, suggesting the tariffs have dampened American demand.
He concluded, “If a merry Christmas is measured by how many decorations people put up, then by that measurement it will be a slightly less merry Christmas.”