News - August 9, 2018 - by Ray Hagar
By Ray Hagar
Don Ahern, president and CEO of Ahern Rentals, is a Donald Trump guy.
"Donald Trump is my hero. Let it be known, I love him," Ahern said this week on Nevada Newsmakers.
But there's two areas of Trump's administration that are causing heartburn for Ahern Rentals, the largest independent rental company in North America, Ahern said.
One concern is Trump's proposed 25 percent tariffs on Chinese imports. They are sure to cause China to impose or increase current tariffs on U.S. goods.
The other concern is the rising cost of health insurance for the company and Trump's failure to repeal and replace Obamacare.
Trump's tariffs appear to be more than just a threat. The U.S. Trade Representative's office this week published a final tariff list targeting 279 imported product lines -- $50 billion in goods overall -- from China. China has vowed to retaliate to an equal degree, according to published reports. A tariff on steel from China and other nations would really hurt, Ahern said.
"These tariffs are not working for us," Ahern said. "It is causing us to have a lot of cost increases now. There is a lot of complexity in the tariffs. We buy millions and millions of tons of steel for our units. We produce over 12,000 pieces of equipment a year and every component we buy is made out of steel."
Ahern, however, is hopeful Trump's negotiating skills will ensure a future where international trade is fairer for all.
"I just think he is the most fabulous negotiator I've ever seen," Ahern said of Trump. "I wish I could hold a candle to him."
Ahern wants all tariffs eliminated and feels that may be Trump's end game. Indeed, Trump called for the end of all tariffs at the G7 summit in June. China's current tariffs on U.S. products makes it easier for Ahern to produce goods for the Chinese market in China, which is what Ahern's company is doing now.
"I do hope that these tariffs are kind of a path to get to where we need to be, which is basically trade with no tariffs, going either way," he said. "Because as we ship equipment into China, we have always been hit with a 9-percent tariff on our products going in there, which really eliminates our ability to go there with our products, because you can build it cheaper in China for domestic use in China.
"So there has in the past, been no opportunity to sell our products into China that is why we are manufacturing in China now," Ahern said
Ahern is confident Trump will give the "Obamacare repeal-and-replace" another shot. Last week, the Trump administration showed a willingness to keep up the fight on healthcare costs as it introduced a new rule that requires hospitals to post online the prices for medical procedures.
"Some of the biggest problems we've got as a businessman, at least for me, has been healthcare," Ahern said. "And although he (Trump) didn't get that passed, he almost did. But he has made a lot of changes to the Affordable Care Act and things are getting a little bit better. But I see healthcare as my biggest problem and I'm really encouraged that he is going to come back and get this Obamacare taken away."
Ahern said his company's health care costs has rocketed from $5 million annually a few years ago to $15 million annually now.
"The company has grown a lot and that is beautiful, but year-in and year-out we've had anywhere from 12 to 20 percent increases (in health-care costs) annually," he said. "And in order to achieve those types of increases, we've actually had to reduce the coverage for our employees."
It is a decision that makes him feel uncomfortable.
"I've always wanted to be an employer that really gave our employees the best health care program," he said.
Health care should be taken over by the government, Ahern said, although he didn't cite specific ways of doing that.
"I'm a Trump supporter and all of that but I really believe that health care should be a government problem and not an employers problem because this causes employees to move around and causes us to have all kinds of problems," he said.
Ahern has recently taken $1 million from the company's earnings and has poured it into the company's health care program for employees with families as a way to reduce employees' costs.
It has helped drop employees' monthly health-care costs for families from about $1,400 a month to about $800 a month, Ahern said.
"The problem is the employee now doesn't know," Ahern said. "He just thinks medical heath-care costs have gone down and they don't know what is really going on ... It is a real mess and it needs to be a government problem. I'm really disappointed in (Sen.) John McCain (R-Ariz.) for killing the health care."
Ahern was referring to McCain's dramatic 'no' vote of the GOP's "skinny repeal" of the Affordable Care Act in late July of 2017.
Even though Trump has stumbled on a few issues, Ahern feels the business climate is better under him that it would have been under a Democratic administration.
"He has saved our country, in my opinion," Ahern said of Trump. "I'm not sure where we would be, had it gone the other direction."