Mattel CEO says toy manufacturing won't come to America, but price hikes will
Mattel CEO says toy manufacturing won't come to America, but price hikes will
Firms are just passing the additional cost of tariffs onto consumers rather than eating it and incurring an additional financial burden to reshore all their manufacturing?
What a fucking surprise
At some point the drop in sales from the increased prices would pretty much require them to move manufacturing back. We'll see if Trump increases tariffs further to try to cause that.
But yeah, there's a pretty big hurdle of actually needing to rebuild the manufacturing base in the US that we abandoned decades ago.
Of course the quickest way to do such a thing would be massive government investments (and central planning would be even better). It's funny how the "communist" policies they hate would actually achieve Trump's stated goals much quicker and more efficiently than the free market could.
But it highlights Trump's inconsistent ideology. Aggressive protectionism ("big government") to bring manufacturing back, but domestically leaving it up to the free market to actually do so, because "big government bad".
It's funny how the "communist" policies they hate would actually achieve Trump's stated goals much quicker and more efficiently than the free market could.
The China Paradox: Communists are better at capitalism than capitalists are.
There is no reason for them to risk the capital if/when the tariffs are reverted in 3.5 years. The only way US could reindustrialize is with a long term (20 to 50 years) plan which provides funding and certain guarantees to the businesses who would have to do it. Or nationalize the industries and do it that way, like all the socialist countries do
The issue at that point is that onshoring would be a decade-plus long project. Why commit to that when Trump changes his mind every twenty minutes?
It depends on how far Trump is willing to go. If he imposes 10000% tariffs or something and no one can afford to buy their products at all, their choice will be to shut down, abandon the American market (their largest market and where they are based out of), or onshore.
No. You're not thinking clearly. It's not just a choice. It's not just spending money. The machines to run the factories will need to be imported because we don't make them here. That means the cost of building a factory gets higher and higher as the tarrifs go higher and higher. That's a contradiction they can't easily escape from. But further, they couldn't get a factory with imported machines built in under 2 years, so it's easier for them to business putsch than it is reshore.
If they decide to build everything from scratch in the US, it would take a decade, and the raw materials would have to be imported.
No amount of Trump's arbitrary and capricious action can make this happen.
AFAIK 100% is already effectively cutting off all trade, anything past this won't make a difference; it's why China stopped raising theirs. Shipments have already entirely ceased.
These are hardly "American" companies, but global corps at this point. I'd expect them to move their operations to Ireland or Panama or something and abandon the unstable US market that way.
There is another secret option
Go bankrupt and let the consumers eat shit
That's shutting down.
I'm dumb and didn't read your comment properly