Tariffs. Any news?

[Kdbradley85]

@Sagebrush excellent video you shared! Guy even goes into the "chicken tax" a tiny bit lol. I remember hearing about it years ago but never really looked into it much further, and only recently found out it's THE reason we have a Tacoma instead of the Hilux. Talk about an eye opener! People would go nuts for the turbo diesel here in the States. It's fun to imagine just how crazy our light truck market could've been in the US... the big three would've had no choice but to step up their games to remain competitive. Instead, I guess Toyota decided it was easier to just flip us the bird and say, "here, y'all can have this instead."

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[SilverSurfer]

@kbradley I mostly agree with you with the exception of what goes up doesn’t come down. In normal functioning markets, that happens all the time. Consider that 24 tacos came out with price increases ranging 8 - 10k more than 23 Tacos on the higher trim & options. Yet, the market didn’t buy many at that higher price and soon dealers were discounting units. I got 7109 off mine and it had arrived at that dealer just the day before and is a more desirable unit.

Supply and demand, increase price too much, you kill demand, dealers need to sell inventory so they lower prices until buyers start buying. Ie market equilibrium.

Tariff’s will do exactly what they are intended to, kill foreign demand and shift that demand to domestic substitutes Giving domestic manufacturers the opportunity to compete while paying better wages and benefits.

It will also incentivize new supply chains with domestically made parts, further benefiting American jobs, and admittedly at higher costs than current, though the wages and profits will now benefit Americans/american companies.

This is a broad brush analysis and I’m not interested debating the micro example of where it cuts the other way.

 

[goin2drt]

Trump targeted Toyota in 2017, so this latest push will hurt Toyota Tacoma's, and the winners will be The Colorado, Ranger, Nissan.

Tacoma can lose its #1 spot soon.

Well if that happens then the Tariffs worked perfectly. I doubt they will lose the top spot but if they do then mission accomplished.

 

[Kdbradley85]

@SilverSurfer I'm all for having more jobs in the US, less dependency on foreign labor, and all of the other amazingly beneficial things that these tariffs are promising to give to us. I think most of us are, but I also think there are likely much better ways to accomplish these things than blanket tariffs. I'll leave it at that. I don't know the exact difference in the cost of a new vehicle wholesale vs when we purchase our own truck from a dealer, but I imagine that large volume dealers have a lower wholesale cost than smaller volume dealers. Larger dealerships bought up a ton of new Tacomas to keep their wholesale prices down, and those which are still sitting on their lots are able to be discounted more heavily before taking any kind of serious loss (at the dealer level). If you just purchased a vehicle at a discount, it most definitely was not impacted by any of these newer tariffs since it's already been imported. This would be true for any vehicles that are already sitting on the dealer lots.

When I say prices should not come down, I'm referring to something called "deflation." A deflationary spiral is VERY bad if it starts to happen. There is a big difference between dealership discounts and deflation. Businesses must make profit to operate successfully and pay their workers. If they are unable to sell their vehicles at a profit because they are too expensive for the average buyer to afford... you get where I'm going. It IS supply and demand, but there's a delicate balance. There are also things like stock prices to consider and shareholder's quarterly earnings. The expectation is that these go up, not down. The ideal rate of inflation should be around 2% in a healthy economy (the goal of the federal reserve). If it goes below zero, things can go bad quickly.

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