VALENCIA, California, Jan 9 (Reuters) – America’s trade wars forced Robert Luna to hike prices on the rustic wooden Mexican furniture he sells from a crowded warehouse here, while down the street, Eddie Cole scrambled to design new products to make up for lost sales on his Chinese-made motorcycle accessories.

Farther down the block, Luis Ruiz curbed plans to add two imported molding machines to his small plastics factory.

Sign up here.

“I voted for him,” said Ruiz, CEO of Valencia Plastics, referring to President Donald Trump. “But I didn’t vote for this.”

All three businesses are nestled in the epitome of a globalized American economy: A lushly landscaped California business park called Rye Canyon. Tariffs are a hot topic here – but experiences vary as much as the businesses that fill the 3.1 million square feet of offices, warehouses, and factories.

Tenants include a company that provides specially equipped cars to film crews for movies and commercials, a dance school, and a company that sells Chinese-made LED lights. There’s even a Walmart Supercenter. Some have lost business while others have flourished under the tariff regime.

Rye Canyon is roughly an hour-and-a-half drive from the sprawling Ports of Los Angeles and Long Beach. And until now, it was a prime locale for globally connected businesses like these. But these days, sitting on the frontlines of global trade is precarious.

The average effective tariff rate on imports to the U.S. now stands at almost 17%–up from 2.5% before Trump took office and the highest level since 1935. Few countries have been spared from the onslaught, such as Cuba, but mainly because existing barriers make meaningful trade with them unlikely.

White House spokesman Kush Desai said President Trump was leveling the playing field for large and small businesses by addressing unfair trading practices through tariffs and reducing cumbersome regulations.

‘WE HAD TO GET CREATIVE’ TO OFFSET TRUMP’S TARIFFS

Rye Canyon’s tenants may receive some clarity soon. The U.S. Supreme Court could rule as early as Friday on the constitutionality of President Trump’s emergency tariffs. The U.S. has so far taken in nearly $150 billion under the International Emergency Economic Powers Act. If struck down, the administration may be forced to refund all or part of that to importers.

For some, the impact of tariffs was painful – but mercifully short. Harlan Kirschner, who imports about 30% of the beauty products he distributes to salons and retailers from an office here, said prices spiked during the first months of the Trump administration’s push to levy the taxes.

“It’s now baked into the cake,” he said. “The price increases went through when the tariffs were being done.” No one talks about those price increases any more, he said.

For Ruiz, the plastics manufacturer, the impact of tariffs is more drawn out. Valencia makes large-mouth containers for protein powders sold at health food stores across the U.S. and Canada. Before Trump’s trade war, Ruiz planned to add two machines costing over half a million dollars to allow him to churn out more containers and new sizes.

But the machines are made in China and tariffs suddenly made them unaffordable. He’s spent the last few months negotiating with the Chinese machine maker—settling on a plan that offsets the added tariff cost by substituting smaller machines and a discount based on his willingness to let the Chinese producer use his factory as an occasional showcase for their products.

“We had to get creative,” he said. “We can’t wait for (Trump) to leave. I’m not going to let the guy decide how we’re going to grow.”

‘I’M MAD AT HIM NOW’

To be sure, there are winners in these trade battles. Ruiz’s former next-door neighbor, Greg Waugh, said tariffs are helping his small padlock factory. He was already planning to move before the trade war erupted, as Rye Canyon wanted his space for the expansion of another larger tenant, a backlot repair shop for Universal Studios. But he’s now glad he moved into a much larger space about two miles away outside the park, because as his competitors announced price increases on imported locks, he’s started getting more inquiries from U.S. buyers looking to buy domestic.

“I think tariffs give us a cushion we need to finally grow and compete,” said Waugh, president and CEO of Pacific Lock.

For Cole, a former pro motorcycle racer turned entrepreneur, there have only been downsides to the new taxes.

He started his motorcycle accessories company in his garage in 1976 and built a factory in the area in the early 1980s. He later sold that business and – as many industries shifted to cheaper production from Asia – reestablished himself later as an importer of motorcycle gear with Chinese business partners, with an office and warehouse in Rye Canyon.

“Ninety-five percent of our products come from China,” he said. Cole estimates he’s paid “hundreds of thousands” in tariffs so far. He declined to disclose his sales.

Cole said he voted for Trump three times in a row, “but I’m mad at him now.”

Cole even wrote to the White House, asking for more consideration of how tariffs disrupt small businesses. He included a photo of a motorcycle stand the company had made for Eric Trump’s family, which has an interest in motorcycles.

“I said, ‘Look Donald, I’m sure there’s a lot of reasons you think tariffs are good for America,” but as a small business owner he doesn’t have the ability to suddenly shift production around the world to contain costs like big corporations. He’s created new products, such as branded tents, to make up for some of the business he’s lost in his traditional lines as prices spiked.

He pulls out his phone to show the response he got back from the White House, via email. “It’s a form letter,” he said, noting that it talks about how the taxes make sense.

Meanwhile, Robert Luna isn’t waiting to see if tariffs will go away or be refunded. His company, DeMejico, started by his Mexican immigrant parents, makes traditional-style furniture including hefty dining tables that sell for up to $8,000. He’s paying 25% tariffs on wooden furniture and 50% on steel accents like hinges, made in his own plant in Mexico. He’s raised prices on some items by 20%.

Fearing further price hikes from tariffs and other rising costs will continue to curb demand, he’s working with a Vietnamese producer on a new line of inexpensive furniture he can sell under a different brand name. Vietnam has tariffs, he said, but also a much lower cost base.

“My thing is mere survival,” he said, “that’s the goal.”

Our Standards: The Thomson Reuters Trust Principles., opens new tab

California Congressman Darrell Issa discusses reports that as many as 20 billionaires could leave the state amid concerns over a proposed new wealth tax which critics say is driving high-net-worth taxpayers out of California on ‘The Evening Edit.’

It isn’t just billionaires leaving California.

Anecdotal data suggest there is also an exodus of regular people who load their belongings into rental trucks and lug them to another state.

U-Haul’s survey of the more than 2.5 million one-way trips using its vehicles in the U.S. last year showed that the gap between the number of people leaving and the number arriving was higher in California than in any other state.

While the Golden State also attracts a large number of newcomers, it has had the biggest net outflow for six years in a row.

Generally, the defectors don’t go far. The top five destinations for the diaspora using U-Haul’s trucks, trailers and boxes last year were Arizona, Nevada, Oregon, Washington and Texas.

California experienced a net outflow of U-Haul users with an in-migration of 49.4%, and those leaving of 50.6%. Massachusetts, New York, New Jersey and Illinois also rank among the bottom five on the index.

U-Haul didn’t speculate on the reasons California continues to top the ranking.

“We continue to find that life circumstances — marriage, children, a death in the family, college, jobs and other events — dictate the need for most moves,” John Taylor, U-Haul International president, said in a press statement.

While California’s exodus was greater than any other state, the silver lining was that the state lost fewer residents to out-of-state migration in 2025 than in 2024.

U-Haul said that broadly the hotly debated issue of blue-to-red state migration, which became more pronounced after the pandemic of 2020, continues to be a discernible trend.

Though U-Haul did not specify the reasons for the exodus, California demographers tracking the trend point to the cost of living and housing affordability as the top reasons for leaving.

“Over the last dozen years or so, on a net basis, the flow out of the state because of housing [affordability] far exceeds other reasons people cite [including] jobs or family,” said Hans Johnson, senior fellow at the Public Policy Institute of California.

“This net out migration from California is a more than two-decade-long trend. And again, we’re a big state, so the net out numbers are big,” he said.

U-Haul data showed that there was a pretty even split between arrivals and departures. While the company declined to share absolute numbers, it said that 50.6% of its one-way customers in California were leaving, while 49.4% were arriving.

U-Haul’s network of 24,000 rental locations across the U.S. provides a near-real-time view of domestic migration dynamics, while official data on population movements often lags.

California’s population grew by a marginal 0.05% in the year ending July 2025, reaching 39.5 million people, according to the California Department of Finance.

After two consecutive years of population decline following the 2020 pandemic, California recorded its third year of population growth in 2025. While international migration has rebounded, the number of California residents moving out increased to 216,000, consistent with levels in 2018 and 2019.

Eric McGhee, senior fellow at the Public Policy Institute of California, who researches the challenges facing California, said there’s growing evidence of political leanings shaping the state’s migration patterns, with those moving out of state more likely to be Republican and those moving in likely to be Democratic.

“Partisanship probably is not the most significant of these considerations, but it may be just the last straw that broke the camel’s back, on top of the other things that are more traditional drivers of migration … cost of living and family and friends and jobs,” McGhee said.

Living in California costs 12.6% more than the national average, according to the U.S. Bureau of Economic Analysis. One of the biggest pain points in the state is housing, which is 57.8% more expensive than what the average American pays.

The U-Haul study across all 50 states found that 7 of the top 10 growth states where people moved to have Republican governors. Nine of the states with the biggest net outflows had Democrat governors.

Texas, Florida and North Carolina were the top three growth states for U-Haul customers, with Dallas, Houston and Austin bagging the top spots for growth in metro regions.

A notable exception in California was San Diego and San Francisco, which were the only California cities in the top 25 metros with a net inflow of one-way U-Haul customers.