Who pays for tariffs update

Bob_C

Bob_C

Swaye's Wigwam
Swaye's Wigwam
Founder's Club
Had a call with one of my big Korean suppliers early this morning. They passed us a +25% increase on Friday. Got them down to +3% after I said I have a US supplier that would be only a +10% increase and would shorten my supply chain from 3 months to 6 weeks (which is worth a couple of points). So foreign supplier is paying +80% of tariff costs. They fear loss of volume far more than loss of margin.
 
When Korea bends the knee, you'll be paying less than you were in the first place.
 
Mexico could be the big winner in all of this. Asia is gonna get fucked. Europe is irrelevant.
 
Bob_C said:
Had a call with one of my big Korean suppliers early this morning. They passed us a +25% increase on Friday. Got them down to +3% after I said I have a US supplier that would be only a +10% increase and would shorten my supply chain from 3 months to 6 weeks (which is worth a couple of points). So foreign supplier is paying +80% of tariff costs. They fear loss of volume far more than loss of margin.
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This is where Big Shot @HHusky tries to mock you for having a job that actually doesn’t involve being a parasite on the misfortunes of your clients.
Just back from PHX-Tucson visiting my oldest daughter (JR at UA) and I’m tanned, rested, and ready to “fill a quota” tomorrow.
 
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It situations like this, whoever makes the quickest deal gets the best deal. They get worse from here. Volume is going to be hard to replace in this environment especially as new competition opens up. Even if margins get squeezed for these foreign manufacturers, the volume is still helping them absorb their overhead costs even if it isn’t great on a per unit basis..
 
Bessent mentioned that of the 20% tariff previously passed on China we saw a 0.7% cost increase.
It's almost like we've been being ripped off.
 
UW_Doog_Bot said:
Bessent mentioned that of the 20% tariff previously passed on China we saw a 0.7% cost increase.
It's almost like we've been being ripped off.
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Exactly. We were already working on a MSRP increase, not for tariff reasons but for elasticity ones. Might pass 1% of the cost onto consumers for this, especially if competition is lazy and assumes they can pass 25% onto consumers. Some of them will try that and get wiped out.
 
Bob_C said:
Mexico could be the big winner in all of this. Asia is gonna get fucked. Europe is irrelevant.
Click to expand...
If Canada would pull their head out of their globalist ass, they’d score too.

Trump’s 51st state threat is really an invite to join the western hemisphere party.

Instead they want to play grabass with the Euros and wave their Ukraine flags.
 
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EverettChris said:
Bob_C said:
Had a call with one of my big Korean suppliers early this morning. They passed us a +25% increase on Friday. Got them down to +3% after I said I have a US supplier that would be only a +10% increase and would shorten my supply chain from 3 months to 6 weeks (which is worth a couple of points). So foreign supplier is paying +80% of tariff costs. They fear loss of volume far more than loss of margin.
Click to expand...
This is where Big Shot @HHusky tries to mock you for having a job that actually doesn’t involve being a parasite on the misfortunes of your clients.
Just back from PHX-Tucson visiting my oldest daughter (JR at UA) and I’m tanned, rested, and ready to “fill a quota” tomorrow.
Click to expand...
Did I mention that it’s rent free?
 
There’s no other correct answer than it is a tax on the consumer. Period.
 
If only consumers had the freedom to choose what they purchase. That would be neat.
How many American cars do you see in Europe?
 
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It’s a tax on whoever has the least amount of leverage in the value chain. Consumer has the most leverage on elastic products.
 
I'm sure you agree with Rand on lots of things
I don't agree on everything.
 
You can tell who is paying the tariffs just based on reactions. Buck and H insist that they want consumers to pay for them for some reason.
 
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