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Discussion Starter · #1 · (Edited)
Auto tariffs--Subaru prices could rise

Get ready to pay more for your next Subaru...

Why the auto tariffs would be bad for America

I don't wanna get too political here--I'm pretty middle of the road myself. I have never, ever believed in tariffs though. I'm with Adam Smith:

"When there is no probability that any such repeal [of a tariff in a foreign country] can be procured, it seems a bad method of compensating the injury done to certain classes of our people to do another injury ourselves, not only to those classes, but to almost all the other classes of them. When our neighbours prohibit some manufacture of ours, we generally prohibit, not only the same, for that alone would seldom affect them considerably, but some other manufacture of theirs. This may no doubt give encouragement to some particular class of workmen among ourselves, and by excluding some of their rivals, may enable them to raise their price in the home-market. Those workmen, however, who suffered by our neighbours prohibition will not be benefited by ours. On the contrary, they and almost all the other classes of our citizens will thereby be obliged to pay dearer than before for certain goods. Every such law, therefore, imposes a real tax upon the whole country, not in favour of that particular class of workmen who were injured by our neighbours prohibition, but of some other class."

(Smith: Wealth of Nations, Book IV, Chapter 2 | Library of Economics and Liberty)
 

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more scare tactics
 

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Discussion Starter · #4 ·
Tariffs are a political tool. We probably shouldn't even talk about them here.........
I am aware it could be controversial. I would hope we could have a civil discourse about it.

I bring it up because it directly affects the price of Subarus made overseas. This is not a trial balloon here, it's a real proposal to slap a tariff on Japanese and European autos.

https://www.usatoday.com/story/news...s-taxes-imported-cars-trucks-parts/639385002/

It would be good to be aware of what's going on, otherwise those of us who want to buy a new Subaru in 2020 might have to pay thousands more.
 

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Just wait until you see the price jump from the quickly climbing steel and aluminum prices. We are getting killed and it’s supposedly getting worse.
 

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IMO, Taxes on japanese and german autos built overseas is seemingly pointless. Other than Subaru, Audi, and high end automakers who will this seriously affect? Are the numbers really big enough to make a difference or is that the point? Make political points by putting tarrifs on a tiny fraction of imports to make a show of force but in reality its doesnt mean much? Toyota, Honda, Nissan, VW, all have factories here making cars/trucks SUVs. BMW and Benz make their SUVs here. SUVs are the hottest ticket right now to the point Ford claims they are getting out of the sedan market. High end luxury cars can add the tax and people wont blink. I just dont see something like that passing for any logical reason but we are talking about the govt. Lots of ideas are floated and never come to fruition. When I looked Friday, All the articles I see on it are from left leaning Trump hating sources. Nothing from the other side. Are THEY purposely not reporting as cover or is the left purposely fear mongering to get more **** stirred up?

What are the details of said tarrifs? Is it any car imported from overseas or if the company makes most of their vehicles in the US or a certain % do they get a pass? Honda CRVs used to be all made in England. Im not sure if thats still true but will they be taxed but Accords not? Civic type R and hatchbacks are made in England, but the rest are made in the US. Will only the hatch and Type R get taxed or no?

We'll see as this plays out I guess
 

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Discussion Starter · #8 ·
My prior Subaru was made in Indiana, my BMW in SC...

The details are still pending but could be up to 25%. It's not pending legislation, it's an action by the executive branch on "national security grounds." (Because allowing Subaru to sell WRX's at $28,000 is a real risk to US national security. :-/)

It sounds like it would apply to cars manufactured overseas regardless of where the headquarters is located (Mexico and Canada are being targeted for instance.) Of course, there are really only 2 US-owned car companies anymore (not including Tesla).

Possibility of U.S. Auto Tariffs Sends Carmakers' Stocks Tumbling | Fortune

There are plenty of articles from the conservative spectrum discussing this--WSJ, Fortune, Money and Bloomberg to name a few. Most modern conservatives worshiped at the feet of Adam Smith and Milton Friedman and are rightly appalled by the idea of tariffs.

I personally think I should be able to drive what I want to drive made by whoever makes it best. I would think most members of a Japanese car forum would feel the same way, but if anyone wants to defend car tariffs have a go at it.
 

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Just wait until you see the cost increase from the steel prices. Like I said before I’d be less worried about the tariff on vehicles made outside of the us and more concerned about all of the materials used to make your car doubling.
 

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Just wait until you see the cost increase from the steel prices. Like I said before I’d be less worried about the tariff on vehicles made outside of the us and more concerned about all of the materials used to make your car doubling.
What's happening with steel costs? Any examples or references?

<edited out specific political editorial>

Prices of raw materials would fluctuate more, I would think, because there's a lot of speculation going on. Cars are less fungible items in this regard--should have more of a predictable increase in price.

As was said, we'll see how this plays out...
 

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This is a tough topic. It is ok to talk about them in the abstract and logically about them. As long as we aren't discussing politicians, parties and the like I will let is stand.

Certainly no discussion/critique of specific politicians and parties.
 

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Tariffs are basically like corporate subsidies …but more insidious. Like corporate subsidies they provide a benefit for a narrow group of people (the corporations targeted and perhaps their employees) but at the expense of a much broader group like the other corporations which consume that product and their employees as well as everyone in that home country who consumes the products with tariffs. Practically speaking what they do is prop up a business in the home tariff country at the expense of all citizens in that country.


This means that, like corporate subsidies, those citizens living in the tariff country are on net made materially LESS wealthy. (They have less stuff for the same money than they would otherwise). But why tariffs are WORSE than even corporate subsidies is because the propped up business is only propped up IN that home country.. not in any other countries. Which means corporations that benefit from the tariffs are not competitive abroad. Additionally, all of the companies that consume the tariff products in the manufacture of their own products are now less competitive both at home and abroad. It also means that in other countries that are not suffering under tariffs, their corporations are now more competitive everywhere else in the world. So perhaps one may think it is ok for every in the one country to pay more for somethings than everyone else in the world but what is often forgotten is that makes exports that consume/used tariff products less competitive to market to the rest of the world.


Example: US Steel tariffs ostensibly benefit a narrow group (US steel companies and their 140 thousand employees). However, that comes purely at the expense of everyone who consumes steel in the US… so basically at the expense of every citizen in the US… But especially including thousands of US companies (and their 6.5 MILLION employees) that consume/use steel in the production of other things they make to sell.. BOTH here AND abroad… So now the thousands of us companies that consume steel in the production of other things are made LESS competitive in foreign markets.




If all of this wasn’t bad enough to convince you what a terrible idea tariffs are consider this additional even more pernicious negative side effect is: By purposely causing mis-allocation of resources into a purposefully less efficient enterprise, tariffs costs the citizens of the home tariff country the opportunity to create even more wealth because those resources tied up in the protected enterprise are not free to be used for much more productive uses/enterprise. That only serves to further make everyone in the tariff country, on net even more materially LESS wealthy than they would be otherwise.


http://steshaw.org/economics-in-one-lesson/chap11p1.html
 

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What's happening with steel costs? Any examples or references?

<edited out specific political editorial>

Prices of raw materials would fluctuate more, I would think, because there's a lot of speculation going on. Cars are less fungible items in this regard--should have more of a predictable increase in price.

As was said, we'll see how this plays out...
Anything we get that is American made is rising in cost as well as anything foreign made. Much of our tooling is designed with a particular alloy in mind, so if we can’t get that particular alloy then there is almost always issues.

This isn’t typical price fluctuation it’s raise small dip big raise. It’s put our shop in a pinch and the company is hastening the moving of our stab bar division over seas.
 

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My prior Subaru was made in Indiana, my BMW in SC...

The details are still pending but could be up to 25%. It's not pending legislation, it's an action by the executive branch on "national security grounds." (Because allowing Subaru to sell WRX's at $28,000 is a real risk to US national security. :-/)

It sounds like it would apply to cars manufactured overseas regardless of where the headquarters is located (Mexico and Canada are being targeted for instance.) Of course, there are really only 2 US-owned car companies anymore (not including Tesla).

Possibility of U.S. Auto Tariffs Sends Carmakers' Stocks Tumbling | Fortune

There are plenty of articles from the conservative spectrum discussing this--WSJ, Fortune, Money and Bloomberg to name a few. Most modern conservatives worshiped at the feet of Adam Smith and Milton Friedman and are rightly appalled by the idea of tariffs.

I personally think I should be able to drive what I want to drive made by whoever makes it best. I would think most members of a Japanese car forum would feel the same way, but if anyone wants to defend car tariffs have a go at it.
appreciate the links Doc, when I did a simple search on Thurs or Friday at work I only found refs from NYT, Wash Post, salon, buzzfeed but nothing from WSJ, Fox or any business mags. I dont know why they wouldnt have shown up from the other sources.

Im not defending the tarriffs, quite the opposite, as I said above it would affect a too small a number of MFRs and cars to be necessarily effective for whatever the purpose, which is why I then said maybe thats on purpose as to score political points yet not really impact the economy. US car quality and reliability has increased dramtically and I dont see any need for any tarriffs.

What else is a mystery is why German and Japanese imports only Recently the beef has been with China (also involving steel) but not the Japanese or Germans., and what about the competition from Korea. They are as much an impact player if not more so now than Japan or Germany. IT doesnt make sense. The thinking is 1980 but those conditions no longer exist.

Totally agree the market and people's wallet should decide who wins and loses. I wasnt a fan of the auto bailout. The govt should not subsidize poor decisionmaking. If they do you only get more poor decisionmaking because there are no consequences to failure.
 
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