Jaguar Land Rover a huge loser in potential new border tax

[aek50]

Just saw this article which doesn't bode well for Land Rover continuing to up their U.S. presence or launch of a new Defender.

https://www.bloomberg.com/news/arti...eeding-17-000-price-hike-to-offset-border-tax

Yikes, if it ever went through. On the other hand, perhaps our late model trucks will see an increase in value...

 

[plh]

must be a big hit for vehicles costing over $100K

 

[M35A2]

Meh, the soccer moms that acquire those things won't care a whit; it all gets rolled into the lease, anyway.

 

[LR Max]

Uh huh. And I'm sure they dropped the price when the dollars came down against the pound...oh wait...

With such a tax, it would force high volume manufacturers to consider building and sourcing within the US. The market here in the US is too big for JLR to ignore.

 

[rjl]

A trade war--which this would ignite --is bad news all around, though. Every other country would most likely institute retaliatory tariffs on U.S.-made goods. Farmers would probably be hurt the most; manufacturing jobs are easy to outsource (or automate) elsewhere. You could also see a significant markup on everything stores like Wal Mart sell.

The Chicken Tax is a good example.

https://en.wikipedia.org/wiki/Chicken_tax

Take that and extrapolate it across every industry, and that's what we'd be looking at.

 

[mpinco]

A "Thought Exercise"? Hmmm, thinking thought wasn't part of this exercise. The border tax of 20% was part of an initial negotiating position to have Mexico pay for the Southern border wall to address illegal immigration. Last I checked LR isn't manufactured in Mexico. Extrapolation to all trade is a laugh. As far as borders, the Eastern border is the Atlantic Ocean and the virtual Ellis Island. Any trade negotiations with Britain will move along as part of Brexit.

The overall strategy is to move manufacturing back to the US and address currency manipulation. How each manufacture handles that outcome is TBD so any discussion of pricing is way too early.

The real battle will be H1b's ...... :ylsmoke:

 

[rjl]

Extrapolation to all trade is a laugh.

Explain the joke.

 

[mpinco]

Explain the joke.

In sciences/engineering, extrapolation is your death knell. The world is not linear and any assumptions you make about trajectories is most likely wrong. In fact in negotiations you are hoping the opponent does extrapolate and make the wrong move.

 

[rjl]

In sciences/engineering, extrapolation is your death knell. The world is not linear and any assumptions you make about trajectories is most likely wrong. In fact in negotiations you are hoping the opponent does extrapolate and make the wrong move.

In politics and law, extrapolation is necessary. History has shown what trade tariffs do and the responses that have been made to them.

Time will tell, but there is no reason to think that this scenario will play out any different, especially when it's what other countries have already stated they will do.

 

[mpinco]

In politics and law, extrapolation is necessary. ......

As a first approximation, OK. But the world is non-linear and those initial models will be wrong. Applying Mexico's tariff to Britain is extrapolation.

 

[NCLR015]

I shay. I'm going to have to cut down on my Grey Poupon.

 

[LR Max]

Or the 20% is used as leverage to get the other country (aka, Mexico) to drop their 20% tax. But then again Mexico could be flooded with "cheap American Products". Which is funny to consider.

 

[Victory_Overland]

Love how everyone is critiquing what has been done in just about every country besides the US either overtly or under the rug! Lol

Nothing "free" about free trade no matter what direction and who's border it's coming accrossed.