Dear Trodat USA Customer,
I hope you and your company survived the difficult waters of 2021. At Trodat we survived but were confronted with historically high freight and logistic costs. In order to minimize disruptions for our customers we covered most of these expenses thinking it was a temporary situation. As we now know, it was not. Freight and shipping costs are still at historically high levels.
In addition we are now facing a new enemy, soaring utility costs. For example, in the beginning of 2021 at our facility in Austria a megawatt hour of electricity averaged €40 (euro) but by December it peaked at €310 (euro)! This has since come down to €210 (euro) but is still a 525% actual increase. The situation in Ukraine is now causing further pressure on these increases as well as oil and gas.
These cost increases were occurring through much of 2021 and began to accelerate in August. For the past 6 months we have been “absorbing” these increases. When we calculated our 2/1/2022 4% price increase we assumed energy cost increases but not to this extreme.
At Trodat USA we are cutting all unnecessary expenses and benefits to help combat these increases. For our customers we do not want to pile on yet another “price increase” for what we hope is a short term situation.
So, starting April 1st, we will be adding a 3% surcharge at the bottom of each invoice. This will be removed once the energy market has come back down to earth. As soon as the average megawatt hour of electricity in the Austrian market drops below €70 (euro) (still up 75% from PY) for a consistent 60 days we will eliminate this surcharge.
The costs are checked and monitored weekly. Currently, the average costs in January was €210 (euro) per megawatt hour. We do not take this action lightly and will keep you informed as things develop.
Paul DeMartini President & CEO Trodat USA
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