Who pays for tariffs update

Bob_C · April 7

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.

Sources · April 7

When Korea bends the knee, you'll be paying less than you were in the first place.

Pitchfork51 · April 7

We’re looking at production in Mexico

We were already but we upped the timetable

Bob_C · April 7

Mexico could be the big winner in all of this. Asia is gonna get fucked. Europe is irrelevant.

EverettChris · April 7

https://hardcorehusky.com/discussion/121274/who-pays-for-tariffs-update

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.

Bob_C · April 7

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..

UW_Doog_Bot · April 7

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.

Bob_C · April 7

https://hardcorehusky.com/discussion/comment/2065127#Comment_2065127

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.