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And the US can't protect its Car Industry? At one time GM was the largest company in the world.
The U.S. has a car industry? ;)

Maybe if America actually made a decent car, people from around the world would buy them.

>:D
 

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On principle alone, not one red cent of my money would ever go towards this idiotic tariff, and I'll just continue to drive my Mercedes-Benz.
If there is a 25% tariff, then you will be doing EXACTLY what they want you to do, not buy anything new from Europe.

We are watching sausage being made. I’m guessing it will turn out well.
A lot of people criticize the fact they don't like watching sausages being made but they love to eat them. If something good comes of this transparency, not just this subject but all the subjects coming up, then watching sausage making vice having sausages being made in smoke filled back rooms will become the de facto standard. Once the public is used to seeing the messy business, anyone new not showing the making of sausages will be criticized for hiding it.

That is a bias attach on the media and of the rights of free speech...time out for you!
LOL, they are all alike. I need your money. I need you to click on my advertising. I need you to buy stuff. I need you to "like me". Click on my Facebook and subscribe to my channel :laugh:

The issue is not whether people will notice price hikes in the event of a steel tariff. They most likely won't. It will be a silent tax built into product price. The issue is whether those countries that are impacted by these tariffs will not retaliate.
All true and all being hyped. Learned from history. No doubt. That's why my head hurts and not going to worry about it.

if this starts really happening and countries band together in retaliation, the U.S won't win
Regarding car tariffs, I believe you are wrong. After listening to the explanations, I understand this better. You need to look at this not from an individual perspective but from a strategic US interest POV, not for one year, but for decades. The US had trade surpluses for 20 years after WWII. That ended 40 years ago. Now the trade deficit hurts GDP.

Source 2016

The EU imported 263,498 cars from the US. Do you know how few cars that is? Ford sells more F Series pickups in 4 months, that model alone, that ALL the US cars sold in ALL the EU countries in a year. Honda sells MORE Accords in the US, just Accords, then all US cars in all EU countries in one year. In the same year the US imported 1,200,829 cars

Now, who is going to be hurting with a 25% tariff? Who is going to blink? Who needs who more? I think I see it now. This is an easy win. Of course I won't be happy, and it appears @Masscan won't be happy, and personally I would refuse to pay the tariff as well, which is exactly what they want to happen, but maybe it would be temporary pain for long term gain. Or it could all just give me a headache.
 

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All true and all being hyped. Learned from history. No doubt. That's why my head hurts and not going to worry about it.
This sentiment is very common these days. The issue is that we actually have large amounts of data on the effect of tariffs both with retaliation and without. 2002, while technically history, is not that long ago. There will be blood domestically if this bears out (not literally hopefully). Turning a blind eye is never a good thing. Take some Advil.
 

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Regarding car tariffs, I believe you are wrong. After listening to the explanations, I understand this better. You need to look at this not from an individual perspective but from a strategic US interest POV, not for one year, but for decades. The US had trade surpluses for 20 years after WWII. That ended 40 years ago. Now the trade deficit hurts GDP.

The EU imported 263,498 cars from the US. Do you know how few cars that is? Ford sells more F Series pickups in 4 months, that model alone, that ALL the US cars sold in ALL the EU countries in a year. Honda sells MORE Accords in the US, just Accords, then all US cars in all EU countries in one year. In the same year the US imported 1,200,829 cars

Now, who is going to be hurting with a 25% tariff? Who is going to blink? Who needs who more? I think I see it now. This is an easy win. Of course I won't be happy, and it appears @Masscan won't be happy, and personally I would refuse to pay the tariff as well, which is exactly what they want to happen, but maybe it would be temporary pain for long term gain. Or it could all just give me a headache.
To look at this through the lens of trade deficit is very alluring. Unfortunately it is also very narrow. The US can have comparative advantage in production in a host of new industries. It is still the greatest innovator in the world. The problem is that right now it is stuck by looking to the past with nostalgia as a driving force; reviving coal, reviving steel etc. This is the past.
 

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To look at this through the lens of trade deficit is very alluring. Unfortunately it is also very narrow. The US can have comparative advantage in production in a host of new industries. It is still the greatest innovator in the world. The problem is that right now it is stuck by looking to the past with nostalgia as a driving force; reviving coal, reviving steel etc. This is the past.
Not touching coal. Not touching steel, thats why I said I wasn't going to worry about it. But a 25% tariff on cars, that I think I can understand. Trade deficits are part of GDP. More cars made in US is better for everyone in the US. The point is to increase GDP (I think). It might hurt a bit but be better in the long run.

I'll put it this way. Tesla seems to be at the forefront of EV. VW AG is about to flood the market with EVs in the next few years. Why should the US corporation, Tesla, be burdened with a 10% European Tax while VW AG only has to pay 2.5%? Let the tariffs be equal, not protectionist. Let the market work as intended, those with the best product wins.

Its a matter of money. They will blink first. They want our business. I believe that is exactly what they are saying.
 

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Its a matter of money. They will blink first. They want our business.
That's always the belief. That the other party will blink first. And maybe down the line that might be the case. But a lot of damage will be done in the interim. Means of production are much easier to move than they used to be. Companies will move production where they need to to avoid tariffs. That's not a one way street. Inevitably the distortions and loss of efficiency in realigning production will lead to a net loss for all involved. And that's not factoring in the cost of actions taken at the behest of market distortions caused by emotional shifts in the body politic and the political class. Losses will be amplified because human beings at the core are emotional beings first and rational second.

Honestly my view is that the real issue is IP protection. The US must act in protecting unlicensed use of it's IP. And the main theft is by China. That is something all countries would get behind. The focus currently is wrong.
 

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That's always the belief. That the other party will blink first.
7:30. Tariffs on cars. Wilbur Ross. I'd be upset too if the free ride was over. There is going to be a lot of upset people that the US is unwilling to bleed money anymore and give away freebies.

@Nylon, I missed the part your worth about market distortions. Those are short term. The market moves up and down depending upon if someone coughs. The free ride up wasn't going to last forever. The best I can think about that is that inevitable, its just a matter of time, it ALWAYS goes back up. ALWAYS, the complete opposite of gravity. Its just a matter of time.
 

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I'm not sure people in the US realize how comparatively speaking "dirt cheap" German luxury cars here are? When I talk to friends in Germany about cars and what I pay to purchase or lease a BMW/Mercedes/Porsche here I always notice a nervous twitch in their left eye. I will not comment further on trade wars and punitive tariffs or I will get a nervous twitch myself...
 

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I'm not sure people in the US realize how comparatively speaking "dirt cheap" German luxury cars here are? When I talk to friends in Germany about cars and what I pay to purchase or lease a BMW/Mercedes/Porsche here I always notice a nervous twitch in their left eye. I will not comment further on trade wars and punitive tariffs or I will get a nervous twitch myself...
Maybe BMW’s cost so much less here because their massive SC plant is so cost effective? And of course due to the competitive U.S. market. Competition is a very good thing for the consumer.
 

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To look at this through the lens of trade deficit is very alluring. Unfortunately it is also very narrow. The US can have comparative advantage in production in a host of new industries. It is still the greatest innovator in the world. The problem is that right now it is stuck by looking to the past with nostalgia as a driving force; reviving coal, reviving steel etc. This is the past.
The steel industry is quite healthy. Forty years of global competition drove it to adopt technology that allows steel production with minimal labor, about 5% of what was needed 30-40 years ago. Much of steel used today requires more transport dollars to deliver to the customer than labor dollars to produce. If we produced every ton of steel used in this country it would not create a significant number of jobs. Those jobs and processes are gone forever.
 

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Maybe BMW’s cost so much less here because their massive SC plant is so cost effective? And of course due to the competitive U.S. market. Competition is a very good thing for the consumer.
The SC plant is very cost effective. In part because most body parts are pre-manufactured in and shipped from Germany. It will be interesting to see how that is taxed under a surely well thought out and measured plan? Some German politicians already urge BMW to pause the additional 500 million investment in SC until this situation here is sorted out. Also I can't wait to see what happens to the new 3 Series plant currently being built in Mexico? Some peeps at BMW are having a rough week I'm sure. My head hurts already after thinking about it for 5 minutes...
 

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The SC plant is very cost effective. In part because most body parts are pre-manufactured in and shipped from Germany. It will be interesting to see how that is taxed under a surely well thought out and measured plan? Some German politicians already urge BMW to pause the additional 500 million investment in SC until this situation here is sorted out.
That's a good point...there's a few German car plants here in the States...I wonder how they will be affected by this potential tariff.

It's not like Germany has been totally one-side about trade when it comes to their auto industry...there's over 4,000 people for instance working at Mercedes' multi-million dollar plant down in Alabama.

It's unfortunate the current administration is so two dimensional in their arguments when it comes to global trade. Who would have thought global trade would be so complicated?

;)
 

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Who would have thought global trade would be so complicated? ;)
Trade is complicated because supply chains are incredibly complex. Its literally impossible to estimate “domestic content” meaningfully. It’s a small world logistically speaking.
 

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It's not like Germany has been totally one-side about trade when it comes to their auto industry...there's over 4,000 people for instance working at Mercedes' multi-million dollar plant down in Alabama.
Not just the Germans. Volvo, Hyundai, Nissan, Toyota, Honda and Kia are manufacturing combined millions of cars each year in the US. Mazda is planing to open a plant in 2020. The free market is working just fine.
There it is again...my nervous twitch. ;)
 

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Trade is complicated because supply chains are incredibly complex. Its literally impossible to estimate “domestic content” meaningfully. It’s a small world logistically speaking.
Someone missed my sarcasm, as well as the famous quote our President uses all the time about things being so complicated..."Who knew?"...

;)
 

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7:30. Tariffs on cars. Wilbur Ross. I'd be upset too if the free ride was over. There is going to be a lot of upset people that the US is unwilling to bleed money anymore and give away freebies.

@Nylon, I missed the part your worth about market distortions. Those are short term. The market moves up and down depending upon if someone coughs. The free ride up wasn't going to last forever. The best I can think about that is that inevitable, its just a matter of time, it ALWAYS goes back up. ALWAYS, the complete opposite of gravity. Its just a matter of time.
I highly recommend not taking economics lessons from any news network. That kind of information is very superficial as highlighted by the attempt to explain the impact of tariffs using soup and coke cans. LOL!

@grim there is no free ride. Please note the automotive tariff that Trump mentioned was a retaliatory action if the EU retaliates against US Steel and Aluminium tariffs. The US automotive industry is thriving. So the rationale to impose automotive tariffs is irrational. You can see where this goes in terms of a negative spiral. Minor tariff adjustments usually engender no retaliation. However massive tariffs that can impact thousands of jobs will inevitably trigger retaliation.

Countries do not levy tariffs solely based on trade with the US. Please note that the US does not have a free trade agreement with the EU or China. Absent specific trade pacts, tariffs are set to stabilize industry and/or spur growth of industry. There is no logic in stating that because the EU or China have higher tariffs than the US on a particular product that it is done out of malice towards the American worker.

Developing economies have different rationales for tariffs than developed economies. Both India and China are massive markets for US goods. India and China have had historically high tariffs on imports. A policy that has evolved and eased as the countries bring hundreds millions of people out of poverty and into the consumer market as domestic industry developed. Bringing hundreds of millions of people out of poverty and into the consumer market is a win win situation for the US and those countries. It is not a zero sum game.

Please note, this does not mean that the US should not be proactive in trade policy to protect domestic jobs, only that any policy should be rational. The current tariff proposal is not. The problem with the nationalist/populist view on trade (one that cuts across party lines) is that it is narrow and emotional.
 

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I highly recommend not taking economics lessons from any news network.

True that. Thank you. I don't get paid to worry about this stuff. They will do whatever they are going to do so its not worth worrying about.
 

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Someone missed my sarcasm, as well as the famous quote our President uses all the time about things being so complicated..."Who knew?"...

;)
I missed your intent of course. I suspect very few who haven’t worked in logistics truly appreciate the complexity of global supply chains. It’s miraculous how all the right stuff gets to the assembly line from all over the world in sequence just when needed to build your custom baby.

Currency shifts, freight rate changes, fuel surcharges, raw material prices, all sorts of things, play into decisions on where to build product and source components. You need an army of accountants to feed data to product managers so sourcing can be optimized globally. Now we have vehicle makers and their first and second tier suppliers flying blind as their compasses spin in circles. That happens from time to time. But as our super moderator reminds us, it will all settle into place eventually. Meanwhile, it’s job security for the accountants.
 

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I stayed off this thread because I detest these types of discussions but will hone in on just cars for a moment . I have a very difficult time understanding defining import Vs domestic . There are American cars with imported parts . There are imported cars with American parts . Employment also crosses oceans for both. If the only basis for defining the origin is the location of corporate base then it's not examining the full scope of the industry.
 
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