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Jm_

sled dog's bollocks
Jan 14, 2002
20,644
11,152
AK
Doesn’t diminish his point that the Chinese products plus 10-25% of tariffs is still well below the price of alternative American products. So now he’s paying the import tax and hasn’t been incentivized to buy American products.
The point is that people don't want to buy US. They want to buy what is cheapest. The one that is most convenient for them.
 

Changleen

Paranoid Member
Jan 9, 2004
15,069
2,963
Pōneke
The point is that people don't want to buy US. They want to buy what is cheapest. The one that is most convenient for them.
It’s interesting to me that such similar products are so much more expensive if US made. He’s talking about a factor of between four and ten times as expensive for (to take him at his word) equivalent devices. That’s far more than would be explained away by hourly rates, health and safety standards or anything else like that. Are these US companies profitable? Do we know? I don’t know anything about these types of machines but I do know a little about industrial production lines. My gut reaction is that the US companies are either absolutely taking the piss or horrendously inefficient/incompetent.
 

mandown

Poopdeck Repost
Jun 1, 2004
22,615
9,778
Transylvania 90210
The point is that people don't want to buy US. They want to buy what is cheapest. The one that is most convenient for them.
Sure. And water is wet.
The issue I see is that the messaging is that tariffs are somehow punitive for the country of origin and meant to incentivize purchasing USA made products. The reality is that the US government is taxing the citizens of the US who purchase the products (and not being transparent about it), and the price structure is such that the tariffs don’t incentivize the purchase of USA made alternatives. At “best” the tariffs will raise the floor pricing of the cheapest goods to keep some buyers from buying anything at all. I suppose the “hope” is that the lost sales because of the higher floor will somehow economically harm foreign manufacturers.
 

JustMtnB44

Monkey
Sep 13, 2006
877
153
Pittsburgh, PA
It’s interesting to me that such similar products are so much more expensive if US made. He’s talking about a factor of between four and ten times as expensive for (to take him at his word) equivalent devices. That’s far more than would be explained away by hourly rates, health and safety standards or anything else like that. Are these US companies profitable? Do we know? I don’t know anything about these types of machines but I do know a little about industrial production lines. My gut reaction is that the US companies are either absolutely taking the piss or horrendously inefficient/incompetent.
I'm a mechanical engineer for a small startup construction equipment company and I have no idea how the Chinese equipment is so cheap. I have also seen those ~ $4000 mini skids on FB marketplace around here. Between shipping and existing import taxes and the Chinese companies making some profit, that means they are building those machines for ~ $1000-1500. You could barely buy the steel and other raw materials needed to make that in the US for $1000. Plus the cost of fabrication, assembly, etc. It might be possible to build and sell a cheap US equivalent for ~$10k from a small company with minimal overhead in a low cost area. But in China materials are dirt cheap (and not always up to the same standards as in the US), labor is dirt cheap, maybe the government is supplying funding just to ensure they undercut the USA.

I agree the US equipment companies charging $40k for a mini skid that costs $15k from China seems out of hand, but often the pricing is determined by what the market will pay as much as what it costs to build things. All of those companies seem to be profitable as they keep expanding their equipment lines so there has not yet been any incentive to lower prices. I know from my company our biggest expense is the engineering department and it's a slow road to profitability.
 
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SkaredShtles

Michael Bolton
Sep 21, 2003
68,629
14,732
In a van.... down by the river

ALEXIS_DH

Tirelessly Awesome
Jan 30, 2003
6,291
901
Lima, Peru, Peru
It’s interesting to me that such similar products are so much more expensive if US made. He’s talking about a factor of between four and ten times as expensive for (to take him at his word) equivalent devices. That’s far more than would be explained away by hourly rates, health and safety standards or anything else like that. Are these US companies profitable? Do we know? I don’t know anything about these types of machines but I do know a little about industrial production lines. My gut reaction is that the US companies are either absolutely taking the piss or horrendously inefficient/incompetent.
I dealt with a major chinese truck manufacturer a few years ago.
They complained our margins (30-40%) were far too large. These were the usual margins for american/european truck parts.
I suspect margins across the entire supply chain in the US are much higher than in China.
 

AngryMetalsmith

Business is good, thanks for asking
Jun 4, 2006
22,530
13,462
I have no idea where I am

Such a fucking travesty. :mad:
Yeah, they also fired 3400 Forest Service employees. What could possibly go wrong ?


 

ALEXIS_DH

Tirelessly Awesome
Jan 30, 2003
6,291
901
Lima, Peru, Peru

Pesqueeb

bicycle in airplane hangar
Feb 2, 2007
42,755
20,373
Riding past the morgue.