Forum Discussion
wilber1 wrote:
Look, a 25% tariff adds 25% to the cost of an imported vehicle, period. What is good for the companies that are represented by the UAW is good for its members. They are one and the same.
A 25% tariff may add 25% to the cost of goods, but that does mean it puts domestic makes at a 25% "advantage" like you keep claiming. Period.
Let me put it in simple terms one more time.....
Lets say due to labor costs, regulation, pensions, healthcare, and other factors a truck built by a US manufacturers costs $35,000. Since many countries(like Thailand, Indonesia, and Brazil) where these small trucks are being built do not have to abide by the same regulations and have weaker currency to our dollar, it only costs them $30,000 to build the same truck and ship it to the US. Now lets slap on the 25% chicken tax and that brings the cost for the foreign made truck to $37,500 while the US made truck remains at $35,000. That is only a 7.4% advantage, not a 25% advantage.
I think you are still stuck on the notion that light trucks were added to the chicken tax by the UAW to protect only the US truck makes from competition. This is completely and utterly false. The UAW did not and still does not care who was making the trucks(foreign or domestic) as long as it was being done on US soil, and preferably with UAW workers. So as far as being "good for it's members", those members can be Suzuki, Toyota, Ram, Honda, Ford, Mitsubishi, GM, VW, are any other manufacturer as long as they build their trucks on US soil by UAW workers. So the notion that the UAW did it to protect only US truck makes is also completely false.wilber1 wrote:
Out of one side of your mouth you say the tariff is to protect American jobs and out of the other side you say it doesn’t make any difference to the prices the companies can charge as if company earnings have no bearing on what they can pay employees. Make up your mind.
The tariff was negotiated by the UAW to protect American jobs. That is a fact. As far as price, where did I say it doesn't make any difference in price other than the fact that the price went up when Toyota and Nissan started making trucks in the US and not paying the chicken tax versus making them overseas and paying the chicken tax, not down. I showed you this data with factual numbers.wilber1 wrote:
The tax actually increases the profit margins of Toyota and Nissan because they have a protected market using non union labour in right to work states.
If you can claim this then show me the numbers. While you are at it, since you are also claiming that the lack of truck competition(which is hilarious) in the US truck market allowed the domestic truck makes to charge more for their trucks, why don't you go ahead and show me the numbers that are bringing you to that conclusion as well.wilber1 wrote:
ShinerBock wrote:
I know why it its there but if you are handed a 25% advantage over a competitor you wouldn't take some of that in profit? The UAW and the industry are the same thing. You can't say it protects the union and not the companies as well. The original target of the tax was the VW van.
Again, unless you have actual data showing that it costs manufacturers 25% more to built overseas and ship here versus building in the US, the 25% advantage you keep quoting is and assumption based on an subjective perception.
The interest of the UAW and US makes are NOT the same, and it wasn't made to the protect US companies. Not only did they have competition since light truck were added to the chicken tax, but they also had to abide by the same rules as foreign brands when they wanted to bring their global models to the US. The only ones that it protected was American jobs by forcing anyone who wanted to sell a truck on US soil(foreign or domestic) to force them to hire US workers to build them here or pay a heavy fine.
Answer me this. Has the US truck makes have competition from foreign truck makes since the chicken tax and do they still have foreign competition? If your answer is no, then that would be false. If the answer is yes, then how did it protect them from competition if they had competition and still do?
Look, a 25% tariff adds 25% to the cost of an imported vehicle, period. What is good for the companies that are represented by the UAW is good for its members. They are one and the same. Out of one side of your mouth you say the tariff is to protect American jobs and out of the other side you say it doesn’t make any difference to the prices the companies can charge as if company earnings have no bearing on what they can pay employees. Make up your mind.
The tax actually increases the profit margins of Toyota and Nissan because they have a protected market using non union labour in right to work states.ShinerBock wrote:
wilber1 wrote:
I know why it its there but if you are handed a 25% advantage over a competitor you wouldn't take some of that in profit? The UAW and the industry are the same thing. You can't say it protects the union and not the companies as well. The original target of the tax was the VW van.
Again, unless you have actual data showing that it costs manufacturers 25% more to built overseas and ship here versus building in the US, the 25% advantage you keep quoting is and assumption based on an subjective perception.
The interest of the UAW and US makes are NOT the same, and it wasn't made to the protect US companies. Not only did they have competition since light truck were added to the chicken tax, but they also had to abide by the same rules as foreign brands when they wanted to bring their global models to the US. The only ones that it protected was American jobs by forcing anyone who wanted to sell a truck on US soil(foreign or domestic) to force them to hire US workers to build them here or pay a heavy fine.
Answer me this. Has the US truck makes have competition from foreign truck makes since the chicken tax and do they still have foreign competition? If your answer is no, then that would be false. If the answer is yes, then how did it protect them from competition if they had competition and still do?
Look, a 25% tariff adds 25% to the cost of an imported vehicle, period. What is good for the companies that are represented by the UAW is good for its members. They are one and the same. Out of one side of your mouth you say the tariff is to protect American jobs and out of the other side you say it doesn’t make any difference to the prices the companies can charge as if company earnings have no bearing on what they can pay employees. Make up your mind.wilber1 wrote:
I know why it its there but if you are handed a 25% advantage over a competitor you wouldn't take some of that in profit? The UAW and the industry are the same thing. You can't say it protects the union and not the companies as well. The original target of the tax was the VW van.
Again, unless you have actual data showing that it costs manufacturers 25% more to built overseas and ship here versus building in the US, the 25% advantage you keep quoting is and assumption based on an subjective perception.
The interest of the UAW and US makes are NOT the same, and it wasn't made to protect US companies. Not only did they have competition since light truck were added to the chicken tax, but they also had to abide by the same rules as foreign brands when they wanted to bring their global models to the US. The only ones that it protected was American jobs by forcing anyone who wanted to sell a truck on US soil(foreign or domestic) to force them to hire US workers to build them here or pay a heavy fine.
Answer me this. Has the US truck makes have competition from foreign truck makes since the chicken tax and do they still have foreign competition? If your answer is no, then that would be false. If the answer is yes, then how did it protect them from competition if they had competition and still do?ShinerBock wrote:
wilber1 wrote:
Then why have the tax stall if it doesn’t make any difference?
To protect American jobs, and more specifically union jobs. That is the reason why the UAW negotiated the chicken tax with LBJ and why they continue to lobby for it. They may not get all of the factories unionized, but the chances are greater to get a factory unionized if you force truck makes to build in the US versus overseas.
The chicken tax was NOT created by the manufacturers to protect their market share and profits. It was created by the UAW to protect their market share and profits.
I know why it its there but if you are handed a 25% advantage over a competitor you wouldn't take some of that in profit? The UAW and the industry are the same thing. You can't say it protects the union and not the companies as well. The original target of the tax was the VW van.wilber1 wrote:
Then why have the tax stall if it doesn’t make any difference?
To protect American jobs, and more specifically union jobs. That is the reason why the UAW negotiated to add the 25% tariff to the chicken tax, and why they continue to lobby for it to stay. They may not get all of the factories unionized, but the chances are greater to get a factory unionized if you force truck makes to build in the US versus overseas.
Light trucks were NOT added to the chicken tax by the manufacturers to protect their market share and profits. It was added by the UAW to protect their market share and profits.- Then why have the tax stall if it doesn’t make any difference?
wilber1 wrote:
I’m not crying about anything. All I am saying is that a 25% tariff allows domestically manufactured vehicles to be sold at a premium. It isn’t rocket science.
Show me with actual numbers. If you can make such a statement then you should easily be able to prove it with numbers of costs, profit margins, and such. Otherwise this is just an assumption.
Again, it is illegal in the US for manufacturers to collude with each other to keep prices high. The US truck market is the largest truck market in the world with the largest selection so I don't see how you can say it is not competitive. I don't think you can hardly get anyone living in the US to say that the US truck market is not competitive. Manufacturers are constantly coming out with new tech, more powerful engines, and more capably trucks in order to leap from each other for sales, but these options come at a price which most truck buyers are currently willing to pay for.
Base truck prices have not increased at a higher rate than cars, however, higher trim levels with higher performance/capable engines have which is what most truck buyers are buying. That is why the average transaction price for trucks is a lot higher than the average expected price. Late last year, the expected full size truck price was just over $38K while the average sales price was over $47k meaning that people are purposely paying a premium in order to get all this new tech now available for trucks(which was previously only found it cars), not because of the supposed lack of competition.
But again, if you have actual numbers showing that domestic built base trucks are sold at a premium due not having foreign competition (even though they have more than most truck markets) then please show it to me.ShinerBock wrote:
wilber1 wrote:
ShinerBock wrote:
How did the chicken tax prevent outside competition when US truck manufacturers had competition from several foreign manufacturers since it's inception?
You don’t think a 25% tax would discourage competition? What do you think would happen to domestic truck prices if a 25% tax was applied to every truck when it left the factory?
It may discourage those who want to flood the market with cheap trucks like China does with everything else, but not from any serious competitors. If a manufacture thinks their product has the potential to sell and make a profit, then they can build a factory here to make it just like our domestic manufacturers had to do or pay the added tax.
The reason why most global truck manufacturers don't is because most US truck buyers don't want the product they are selling. Most want full size trucks with more capability and the 6k GVWR cap on Class 1 mid size trucks keeps their capabilities low.
If domestic trucks went up 25% then of course the cost would go up, and instead of most people buying the higher trim levels like they do now, they would probably buy the mid-level trims more. Of course this would be short lived once the market adjusts.
Again, I am not sure why either of you are so interested in speaking about what the US should do with its tariffs when neither of you live here and we are currently sitting at a $600B trade deficit with other countries meaning we import $600B dollars more product than we export. If you don't like it, then either move here to vote the way you want it to be or go pound sand.
I don't see either of you crying about the 10-25% tariffs other countries have on our imports even though we buy more from them than they buy from us. Or even the fact that China doesn't allow any foreign country to own more than 50% of a company or property in China(while we allow full ownership of both property and capital), and any foreign company must partner with a domestic company which will inevitably reverse engineer their product to sell for less.
I’m not crying about anything. All I am saying is that a 25% tariff allows domestically manufactured vehicles to be sold at a premium. It isn’t rocket science.wilber1 wrote:
ShinerBock wrote:
How did the chicken tax prevent outside competition when US truck manufacturers had competition from several foreign manufacturers since it's inception?
You don’t think a 25% tax would discourage competition? What do you think would happen to domestic truck prices if a 25% tax was applied to every truck when it left the factory?
It may discourage those who want to flood the market with cheap trucks like China does with everything else, but not from any serious competitors. If a manufacture thinks their product has the potential to sell and make a profit, then they can build a factory here to make it just like our domestic manufacturers had to do or pay the added tax.
The reason why most global truck manufacturers don't is because most US truck buyers don't want the product they are selling. Most want full size trucks with more capability and the 6k GVWR cap on Class 1 mid size trucks keeps their capabilities low.
If domestic trucks went up 25% then of course the cost would go up, and instead of most people buying the higher trim levels like they do now, they would probably buy the mid-level trims more. Of course this would be short lived once the market adjusts.
Again, I am not sure why either of you are so interested in speaking about what the US should do with its tariffs when neither of you live here and we are currently sitting at a $600B trade deficit with other countries meaning we import $600B dollars more product than we export. If you don't like it, then either move here to vote the way you want it to be or go pound sand.
I don't see either of you crying about the 10-25% tariffs other countries have on our imports even though we buy more from them than they buy from us. Or even the fact that China doesn't allow any foreign country to own more than 50% of a company or property in China(while we allow full ownership of both property and capital), and any foreign company must partner with a domestic company which will inevitably reverse engineer their product to sell for less.
