Manufacturer Automatic Precision sees 2026 as year of survival
When tariffs were imposed on many of the raw materials imported by Automatic Precision, Vice President Chris Bulat knew he could avoid raising prices on customers by relying on the company's inventory.
But almost a year later, things have changed for the Harwood Heights company.
“We’ve used up a good portion of our inventory. The next lots that are coming in will be subject to tariffs, so those prices will be passed along to our customers,” Bulat said.
He expects the impact to be felt into 2026 but said it's complicated.
"There's a lot of factors, not just tariffs. There's supply and demand," he said. "I don't know if we'll see any miraculous stuff in 2026 [like increased profits]. If anything, it will be towards the end of the year."
The company, which has been in business since 1976, makes Swiss precision-turned components, or products made by Swiss machinery, and it specializes in connector electrical contacts made from aluminum, brass, copper, stainless steel, bronze, nickel and titanium.
Bulat, whose father, Peter, started the company and whose brother, John, also works there, said the family-owned business has managed to avoid layoffs. It still employs 49 people and continues running three shifts five days a week on 200 machines.
But 2025 was a challenging year.
“This is survival mode. It’s not about profit,” Bulat said.
He believes the impact of tariffs are just beginning to hit American manufacturers like Automatic Precision. While it’s challenging, he feels confident that most established companies will get through it.
“It’s definitely been painful for manufacturers to survive, but I think companies that had a decent customer base and a good reputation are still here. It’s a cyclical weeding out of the weaker companies and companies that are underperforming,” he said.
About half of the raw materials Automatic Precision uses to manufacture come from overseas, many of which are subject to tariffs of nearly 30%.
Bulat said unlike some other companies, the impact on Automatic Precision has been on parts as opposed to the entire product.
“My customers are paying for an increased raw material that’s just a component of the product versus buying from our competitors that are overseas and [being] subject to a 30% tariff on the entire product,” Bulat said.
The company manufactures parts for customers in industries such as automotive, aerospace, medical, firearms, hydraulic companies and the government.
He said some of the increased prices from tariffs may be offset by lower gas and oil prices.
“The cost of living is going down, [in other words] oil and gasoline, and that trickles down to all other products,” Bulat said.
While tariffs have caused his company to “basically flatline” in 2025, he sees them as long overdue.
“I think it was necessary to put the country back on track. We’ve lost so much manufacturing to other countries,” he said.
“I definitely have seen customers that have stopped buying from overseas. They’re looking to source locally and that started immediately when there was just a rumor of tariffs. That’s only going to continue. It took years for this country to fall into the [manufacturing] lull, it will take years for it to come out.”
Bulat also believes there will be a large demand for workers with technical skills, explaining that the machines used by his employees usually take about five years to master.
“I would strongly suggest that kids who are mechanically inclined look into trade schools,” he said. “There are a large group of highly skilled individuals who will be retiring soon. Ten years from now, the average electrician or plumber will be paid like doctors.”