View Full Version : Car Manufacturers Howling about new US Tariffs and Chinese retaliation
dado potato
7-2-18, 11:40am
On July 6 new US tariffs will be applied on a variety of manufactured goods imported from China. China has warned they will immediately retaliate with a 25% countervailing duty on cars imported from the US. China is the largest automobile market in the world, with a rate of growth greater than the USA.
GM, Ford, and BMW AG have complained that the tit-for-tat between the US and China will threaten jobs in their US manufacturing facilities.
Adding to the angst in the automotive industry, President Trump asked on May 23 for an inquiry into the "national security" implications of foreign sourced components of vehicles manufactured in the USA. Foreign content typically may account for 45% to 50% of the costs of a new vehicle.
Toyota USA pointed out that they have 10 US manufacturing plants, and a 25% tariff on imported auto parts would increase the costs of a Toyota Camry by an estimated $1,800.
Meanwhile Trump has suggested a new 20% tariff on cars assembled in Europe, and the EU warned of countervailing duties.
So, it's unanimous. Canada retaliates, China retaliates, EU retaliates, Mexico retaliates.
I recall 3/1/2018 when Donald Trump tweeted, ...trade wars are good, and easy to win.
Teacher Terry
7-2-18, 11:50am
He is a moron.
ApatheticNoMore
7-2-18, 11:55am
Trump doesn't have a policy in all likelihood. Then again globalization wasn't any kind of policy that made any sense either. Trade treaties without significant labor and environmental protections don't make sense (and in many ways perhaps neither does globalization, shipping things all over the world when they could be made locally, often doesn't make much sense).
Williamsmith
7-2-18, 12:44pm
I have a 2014 Tacoma and a 2017 Rav 4......The cost of Toyotas can skyrocket and it won’t bother me. In fact, it will just make my cars worth more on the used market.
My 2017 Dodge Charger Hellcat is an American icon, a symbol of the resurgence of the old-school muscle car, a triumph of petroleum-wasting American brawn and brash over European hybrid-elegance.
The 707+ hp engine is hand-made in Mexico. The car is built in Canada. It's world-beating 8-speed automatic transmission is from Germany. The remarkably well-balanced and capable chassis is a Mercedes design. I think the crappy plastic interior is made in the USA.
ApatheticNoMore
7-2-18, 3:28pm
trade in many cases doesn't make a lot of sense, but yes considering cars were made badly enough in the u.s. for a period of time that whole generations wouldn't touch them with a 10 foot pole at this time, it's not a great example. But at this point foreign brands (Toyota, Honda etc.) are as likely to be made in the U.S. as "American" brands. Besides given that they only want to make SUVs now well ...
I have a 2014 Tacoma and a 2017 Rav 4......The cost of Toyotas can skyrocket and it won’t bother me. In fact, it will just make my cars worth more on the used market.
Perhaps now would be a good time to invest in Carmax.
This post gave me a needed chuckle as I work through some careful letter writing. Thanks :laff:
My 2017 Dodge Charger Hellcat is an American icon, a symbol of the resurgence of the old-school muscle car, a triumph of petroleum-wasting American brawn and brash over European hybrid-elegance.
The 707+ hp engine is hand-made in Mexico. The car is built in Canada. It's world-beating 8-speed automatic transmission is from Germany. The remarkably well-balanced and capable chassis is a Mercedes design. I think the crappy plastic interior is made in the USA.
My Jeep Wrangler is made in Ohio, but is owned now by Fiat. My wife’s BMW I believe was built in South Carolina. Of coarse I’m not sure where the majority of the parts are made.
But maybe it would be nice if more things were made in the USA. I can remember when Wallmart bought made in the USA products, but that just shows how old I’m getting.
My Jeep Wrangler is made in Ohio, but is owned now by Fiat. My wife’s BMW I believe was built in South Carolina. Of coarse I’m not sure where the majority of the parts are made.
But maybe it would be nice if more things were made in the USA. I can remember when Wallmart bought made in the USA products, but that just shows how old I’m getting.
Just a serious question. How many decisions about making products outside the US were made by corporations who were held accountable to generate a profit by US shareholders and other investors? Basically, what or who drove the industries to move overseas or, more to the point now, how many products are made locally by robots in the US using prefab parts made elsewhere?
Too bad Tesla cars keep catching on fire. It could be an opportunity for them. I think their Model 3 is in the same category and possibly would compete with the mid-priced luxury cars like BMW and maybe Mercedes. Trump seems to start his deal making at the extremes and this is a bold move, but I'd expect him to "make a better deal" if it starts to show in the economy. The U.S. is the largest consumer of goods in the global market and that is a decent bargaining chip. 45 is spinning all sort of dials that affect the economy and I don't think anyone will know the outcome until the numbers come out.
Some poll predicting the economy will be the overriding issue in the 2020 election, even above immigration. It's still a long ways off, but I've read a couple of pieces saying his approval rating are rising due to the strong economy. People may have moral issues around immigration or grave concerns about the environment, but assuming no wars are taking sons away, people will vote from their wallets.
Williamsmith
7-3-18, 8:57am
Too bad Tesla cars keep catching on fire. It could be an opportunity for them. I think their Model 3 is in the same category and possibly would compete with the mid-priced luxury cars like BMW and maybe Mercedes. Trump seems to start his deal making at the extremes and this is a bold move, but I'd expect him to "make a better deal" if it starts to show in the economy. The U.S. is the largest consumer of goods in the global market and that is a decent bargaining chip. 45 is spinning all sort of dials that affect the economy and I don't think anyone will know the outcome until the numbers come out.
Some poll predicting the economy will be the overriding issue in the 2020 election, even above immigration. It's still a long ways off, but I've read a couple of pieces saying his approval rating are rising due to the strong economy. People may have moral issues around immigration or grave concerns about the environment, but assuming no wars are taking sons away, people will vote from their wallets.
Im about as middle America as it gets and I ain’t complaining. The people who work with their hands have gotten a boost. Those are the people that elected Trump and will continue to support him. Even if it comes to military action somewhere, I think he would create this huge war machine with military production at home and the support would remain. The political establishment created the platform for Trump. And they still don’t understand it. In many places, the man is a hero.
Just a serious question. How many decisions about making products outside the US were made by corporations who were held accountable to generate a profit by US shareholders and other investors? Basically, what or who drove the industries to move overseas or, more to the point now, how many products are made locally by robots in the US using prefab parts made elsewhere?
As a shareholder I want the best return on my investment. If this means using cheap labor outside the US ,that is fine. But as a citizen I’d rather see the work done here. So if it becomes more expensive to move overseas and the work returns here, that is also fine.
Williamsmith
7-3-18, 9:46am
As a shareholder I want the best return on my investment. If this means using cheap labor outside the US ,that is fine. But as a citizen I’d rather see the work done here. So if it becomes more expensive to move overseas and the work returns here, that is also fine..
As a shareholder, aren’t you also co-conspirators in the corporate immorality of overseas exploitation of human laborers? And the consequences of marginalizing laborers here at home.....doesn’t that have to be the direct consequence of adhering to a strict “return on investment” policy. After all, slave owners had that system maximized but it turned out to have infinite unintended consequences.
Teacher Terry
7-3-18, 9:54am
So glad I don’t live somewhere that Trump is a hero. It really boggles the mind.
Im about as middle America as it gets and I ain’t complaining. The people who work with their hands have gotten a boost. Those are the people that elected Trump and will continue to support him. Even if it comes to military action somewhere, I think he would create this huge war machine with military production at home and the support would remain. The political establishment created the platform for Trump. And they still don’t understand it. In many places, the man is a hero.
My home town was once known as the Pittsburgh of the West before the blast furnaces shut down a few decades ago. Started by J.D. Rockerfeller, it's now a subsidiary of a Russian company (I wonder how the tariffs work there). They still smelt and make a little rail, wire, and such but it's a shadow of it's former self and the town hasn't recovered. One recent list put it in the top 20 worst cities to live in the US due to poor wages and high unemployment. I'm not getting any news from there that there are any brighter prospects. Other than a few dribbles and isolated incidences I've not heard of any big changes in Detroit or the coal mining regions, or other traditional manufacturing. I imagine they are desperate enough to hang onto Trump's false promises and token tax cuts. But it's early.
ToomuchStuff
7-4-18, 1:38pm
But maybe it would be nice if more things were made in the USA. I can remember when Wallmart bought made in the USA products, but that just shows how old I’m getting.
Walmart, Sears, as well as others. A lot of that seemed to go away, around the time of several lawsuits about what made in the USA meant. Stanley tool works verses the FTC springs to mind, where Stanley tried to claim since over 50% of the cost of the product, was the final finishing and labor from this country, they should be able to claim made in the USA.
.
As a shareholder, aren’t you also co-conspirators in the corporate immorality of overseas exploitation of human laborers? And the consequences of marginalizing laborers here at home.....doesn’t that have to be the direct consequence of adhering to a strict “return on investment” policy. After all, slave owners had that system maximized but it turned out to have infinite unintended consequences.
Yes, along with anyone who owns any stock. If you have any retirement funds invested or pension plan I’m sure they all own a percentage of stocks in their portfolios.
Of coarse those overseas jobs have probably still raised the standard of living there. They just are not our neighbors. And the other co-conspirators are those who demand the cheapest product with no requard to where it was produced.
Williamsmith
7-4-18, 4:53pm
Yes, along with anyone who owns any stock. If you have any retirement funds invested or pension plan I’m sure they all own a percentage of stocks in their portfolios.
Of coarse those overseas jobs have probably still raised the standard of living there. They just are not our neighbors. And the other co-conspirators are those who demand the cheapest product with no requard to where it was produced.
When you are done making stockholders and retirees rich, spoiling the overseas workforce and bending over backwards for the whining America cheapskate consumer .....it’s a wonder there is any money left over for the hard working businessman.
When you are done making stockholders and retirees rich, spoiling the overseas workforce and bending over backwards for the whining America cheapskate consumer .....it’s a wonder there is any money left over for the hard working businessman.
What is your solution?
Williamsmith
7-5-18, 7:10am
What is your solution?
”It’s easy. All you need is Love.”
Lennon/McCartney
It's sort of a conundrum that people, or at least some people, want more products made in the US, but are probably not willing to soak up the increased manufacturing costs. I'm old enough to remember the Carter Reagan years when we had double digit inflation and interest rates. And the subsequent recession when the fed used monetary policy to keep inflation in check.
What is your solution?
I think it has something to do with the proletariat seizing the means of production.
I think it has something to do with the proletariat seizing the means of production.
like Africans seizing farms and Venezuela. I’m not sure that is working out as intended. At least not for the majority there.
Williamsmith
7-5-18, 8:01am
I think it has something to do with the proletariat seizing the means of production.
A nice balance between the proletariat and the bourgeoisie seems appropriate. To produce wealth, you have to have a working class willing to sell their labor. Seems like cutting grass and shoveling snow demands higher wages these days. Who would have thunk it? That class of person doesn’t have stock investments, meaningful healthcare, much more than an old 70s model trailer to hole up in and an old F150 without a tailgate. He needs a hug and a bottle of Colt 45.
A nice balance between the proletariat and the bourgeoisie seems appropriate. To produce wealth, you have to have a working class willing to sell their labor. Seems like cutting grass and shoveling snow demands higher wages these days. Who would have thunk it? That class of person doesn’t have stock investments, meaningful healthcare, much more than an old 70s model trailer to hole up in and an old F150 without a tailgate. He needs a hug and a bottle of Colt 45.
Reading this makes me think I should look into robotics stocks.
Reading this makes me think I should look into robotics stocks.
Im sure its the future. Tractors can be run remotely by gps now, when labor cost get to high will mowers and snowblowers be far behind. We’re already using fewer and fewer checkers at the store and fast food places. I don’t think higher wages will cause the trend to change.
But now we have very low unemployment so there are still plenty of jobs out there. So I guess wages can go up from here. I have no problem with that, whatever the market will bear. But company’s must make a profit and it has to come from somewhere. If wages go up so must prices. At least to maintain the same ROE.
A nice balance between the proletariat and the bourgeoisie seems appropriate. To produce wealth, you have to have a working class willing to sell their labor. Seems like cutting grass and shoveling snow demands higher wages these days. Who would have thunk it? That class of person doesn’t have stock investments, meaningful healthcare, much more than an old 70s model trailer to hole up in and an old F150 without a tailgate. He needs a hug and a bottle of Colt 45.
What more does an 18-20 year old kid need? I wouldn’t think mowing grass and shoveling snow to be a long term career plan.
What more does an 18-20 year old kid need? I wouldn’t think mowing grass and shoveling snow to be a long term career plan.
In my neighborhood the problem would be finding teenagers willing to do that sort of work.
ApatheticNoMore
7-5-18, 11:16am
What more does an 18-20 year old kid need? I wouldn’t think mowing grass and shoveling snow to be a long term career plan.
yea it's an income which is sometimes the most immediate need, but no prize, people need a REAL long term future is what they need, and they also know it, that all the bandaids on a gaping wound, all the gigs that cost almost as much in deprecation as you earn (Uber etc.), are just that that.
Although it should have seemed obvious, I had to read it somewhere to catch on. Tariffs go straight to the government coffer. This will be a huge cash cow. Another big element in Ts big economic experiment. I don’t know how far this will go to cover huge debt issues from the tax cuts, but I’m starting to think of new motives for tariffs other than the most obvious. A slick variation of taxation without congressional approval. The government gets the money and the consumer pays the cost of increased prices. Then when the costs of goods goes up...more tax revenue!
Maybe this is part of some sort of economic stimulation, but I’m starting to see
it as taking money away from the consumer and giving it to the government.
Williamsmith
7-6-18, 9:01am
Perhaps I’ll risk stepping up to the soap box. It remains to be seen if Trumps tariff war will be easily won (I have doubts) or if he even intends to prosecute it. So much of his policies are bluster meant to showcase the “art of the deal.”
Should we consider discussing tariffs and protectionism without acknowledging some view NAFTA and WTO as disasters? Aren’t tariffs used as a tool by other governments when they feel they’re getting the short end of the stick anyway?
Arent tariffs simply a rough thread in the woven fabiric of the world economy? There’s no doubt the eruption of tariffs will do untold damage to the world economy and reduce the standard of consumerism for everyone. But Almost all bad ideas do have a few happy consequences. At least US consumers would start to value durable goods over disposables again.
I don’t have a degree in economics or even claim to have studied it thoroughly. All I can say is I would rather be able to buy a Toyota or VW that is well made and reliable over a US made roll of the dice. Which brings me to a point that many won’t consider. That our own government has brought about the fertile ground out of which Trumps tariffs are springing. Abusive federal regulations on businesses, taxes upon taxes and an inability to extract itself from the use of its military in a world wide presence of micromanagement and real “meddling” in other countries business.
The taxpayers subsidizing a bloated defense department is diverting money away from healthcare, infrastructure and real improvements to quality of life for the average American and for any prospective immigrant. Simply put the rest of the world is constantly “investing” in America by buying its debt and it recoups those investments by selling more of its product to us than we sell to them.
Thats why I worry about this tariff war. Not that we can’t survive it. But that I hope our people are still endowed with a tough spirit willing to endure personal hardships because it could be required to persevere.
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