Why this small business that sells cycling clothes for women decided to fight Trump’s tariffs — ‘our backs were up against the wall’

Terry Precision Cycling turned 40 with a women’s-only product line, navigating a tough early market, thin profit margins, and pandemic-era boom and bust. But Holm, the company’s president, wasn’t sure how his company would pay the tariffs first announced in April and stay in business.

“We felt like our backs were against the wall,” he said, explaining why he joined a lawsuit challenging the tariffs that will be heard by the Supreme Court next week.

Terry Precision Cycling’s offices are located behind a café in Burlington, Vermont, on a leafy street that explodes with color in the fall. Local trophies share wall space with bike saddles and color wheel fabric swatches. Orders are shipped from a warehouse a few miles away.

It appears to be an unexpected epicenter of the uproar over Trump’s tariffs that is raging on the trading floors of global stock exchanges and in the boardrooms of international companies.

But Terry Precision Cycling is one of a handful of small companies challenging several of Trump’s tariffs on Wednesday before the Supreme Court in a case that has extraordinary implications for the limits of presidential power and for the global economy.

Small businesses have been hit hard

The company is small, but works with suppliers all over the world. It sells cycling shorts manufactured in the United States using materials imported from France, Guatemala and Italy. Our distinctive, colorfully printed cycling jerseys are made from high-tech materials that can’t be found outside of China.

Tariffs mean the company has to pay more for all those imports, and without the cash reserves of a large company, it has few options to make up the shortfall besides raising prices for customers. The dizzying pace of changes in tariffs, especially on goods coming from China, has made setting prices like a roll of the dice. “If we don’t know the rules of the game, how are we supposed to play?” – asked Holm.

The company had to add $50 to one pair of shorts in the pipeline when Chinese tariffs reached 145%, bringing the price to $199. “Name the cost and we can set a price, and then we can step back and see who can actually afford it,” Holm said.

The other companies in the lawsuit he joined are also small businesses, including a plumbing supply company in Utah, a wine importer from New York, and a fishing tackle manufacturer in Pennsylvania.

Holm started working at the company more than a decade ago, and was seriously interested in cycling alongside his job. He often rides his bike to work and bikes it outside his office, alongside the company’s designers and salespeople. Hulme, a thin man with sunken eyes and side-parted hair, was appointed president about two years ago, as the company, started by women’s cycling pioneer Georgina Terry, was reeling from a downturn in the outdoor market following the coronavirus pandemic. His usual demeanor is perked up when he talks about the design of their lined shorts or the level of SPF protection in their shirts.

“It’s all about fit and performance, feeling safe and comfortable,” he said. “That’s our foundation, getting people, getting women, riding. More bike butts and getting out there.”

The companies challenging Trump’s tariffs are represented by the Libertarian Justice Center, a libertarian-leaning legal group usually more attuned to conservative issues. But they say Trump is wrong about sweeping tariffs, which are expected to collect a total of about $3 trillion from businesses over the next decade, according to the Congressional Budget Office.

They say the president is using an emergency powers law that does not mention tariffs to claim nearly unlimited powers to impose and change import duties at will, something no other president has done on this scale.

“This is practically what the American Revolution was fought over, the principle that taxes are not legitimate unless they are adopted by the representatives of the people,” said Jeffrey Schwab, an attorney at the Liberty Center for Justice.

Trump described the case as one of the most important in the country

The Trump administration said the law allows the president to regulate imports, and this includes tariffs. The president has been vocal about the issue, suggesting at one point that he might go to the arguments himself — something no other sitting president is on record to have done. “This is one of the most important cases in the history of our country because if we do not win this case, we will suffer from a weak and turbulent financial mess for many years to come,” he said.

The law that Trump used in many of his definitions, the International Emergency Economic Powers Act, has been invoked dozens of times over the past decades, often to impose sanctions on other countries.

But no president used it to impose tariffs until February, when Trump imposed tariffs on China, Mexico and Canada. He said that countries had not done enough to stop illegal immigration and drug trafficking.

In April, he unveiled “reciprocal” tariffs on almost all US trading partners with a base limit of 10% and higher increases for specific countries, although many of these tariffs have since been suspended. Tariffs on China reached 145% at one point, but have since fallen and are heading to 20% overall under Trump’s latest deal with China.

Multiple lawsuits have been filed over definitions of emergency powers. The Supreme Court will also hear two other cases on Wednesday, one from a group of Democratic-leaning states and another from an educational toy company in Illinois.

The plaintiffs won two rounds in lower courts, although the government convinced four appeals judges that the law allows the president broad authority over tariffs.

How the Supreme Court will rule is an open question

The Supreme Court will now be asked to rule on the scope of the president’s authority. The justices, three of whom were appointed by Trump, have so far been reluctant to check the flexibility of his extraordinary executive power.

But they have been skeptical of presidential claims to power before, such as when Joe Biden tried to forgive $400 billion in student loans under a different law that deals with national emergencies. The court found that the law did not clearly give Biden the authority to enact such an expensive program.

By contrast, Trump’s tariffs are expected to total into the trillions. It is also expected to increase people’s bills by about $2,000 per household this year, an analysis by the Budget Lab at Yale University found.

Tariff revenues totaled $195 billion by September, more than double what they were the previous year — although the government may have to repay that money if judges strike down the tariffs.

Trump acknowledged that Americans may feel some short-term pain from the tariffs, but stressed that they would achieve more favorable trade deals and help American manufacturing. His administration says the tariffs are different from Biden’s student loan case because it concerns foreign affairs, an area it says courts shouldn’t second guess the president.

For the folks at Terry Precision Cycling, those big-picture political questions were far removed from their decision to join the lawsuit. Holm thought more about the company’s 20 or so employees, its legacy and the women who buy its products out of a love of cycling.

“If doing this becomes unbearable for them, few will be able to enter into that joy, the freedom of riding a bike,” he said. “It was about surviving that uncertainty.”