By on June 2, 2018

BMW Spartanburg Assembly Plant Factory

As nations continue plotting how to best stab each other in the back in the wake the United States’ decision to impose steeper tariffs on aluminum and steel, manufacturers have to find a way to roll with the punches. Domestic BMW dealers have begun crapping their designer britches over fears that 3 Series models will suddenly host MSRPs in excess of $60,000 if the Trump administration follows through with a threat to impose high import duties on cars.

While we don’t know if the 25 percent import tariff on cars will come to pass, we do know the very real steel tariffs will shrink the profit margin of many vehicles. However, BMW is one of the first automakers we’ve heard discussing the purchase of more U.S. steel to mitigate costs.

On Friday, the automaker announced it was seriously considering boosting the amount of locally sourced steel for its U.S. factory.

BMW’s plant in Spartanburg, South Carolina, is the automaker’s largest in terms of production volume. It currently sources more than 70 percent of its steel from within the United States.

“We have a target to increase the U.S. percentage, which is dependent on the availability of appropriate specification and quality,” the automaker said in a statement.

The facility is currently responsible of the brand’s popular SUV models, which includes the X3, X4, X5, X6, and X7. As a result, the plant was the largest vehicle exporter by value from the United States in 2017.

[Source: Reuters] [Image: BMW]

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61 Comments on “Steel of a Deal: BMW Looking at Sourcing More Carbonized Iron From U.S....”


  • avatar
    Robbie

    BMW designs a Trump survival strategy…

    • 0 avatar
      brn

      That’s another way of saying Trump’s strategy is producing the desired outcome.

      • 0 avatar
        Ce he sin

        Yes, it’s serving to increase the cost of steel in the US. That’s the desired outcome isn’t it?

        • 0 avatar
          mcs

          @ ce he sin

          or the goal is to quietly increase taxes. Remember, tariffs are going to be paid by the consumer and end up in government coffers. That way they can increase our taxes while telling us they’ve lowered them.

        • 0 avatar
          Luke42

          @Ce he sin:

          Trump survival strategy at Ford: Cut low margin vehicles from the lineup, essentially eliminating cars.

          Trump survival at BMW: All of BMWs vehicles are high margin (relatively speaking), so eithrr eat the increased costs and/or raise prices.

      • 0 avatar
        Lou_BC

        That’s another way of saying PUTIN’S’s strategy is producing the desired outcome.

        There, fixed it for ya!

    • 0 avatar
      Big Al from Oz

      Robbie,
      Does the article not state BMW already procures the bulk of it meatal within the US?

      So, how is this a Trump win?

      What about the industry more reliant on imported metal? There are 4 million manufacturing jobs reliant on metal, discounting the 200 000 steelworkers.

      So to gain a handful of additional steelworkers you are prepared to possibly lose 10s of 1000s manufacturing jobs …… plus all the jobs lost with targeted tariffs on, jeans, motorbikes and on and on. Oh, and the farmers the Chinese are going to screw over.

      How is this a win for the American worker?

      Don’t forget the associated price rise of affected goods and services Americans will also pay.

      • 0 avatar
        bullnuke

        The price of goods and services in the US may well rise a bit, BAFO. Manufacturing/raw material procurement offshore was always about lowering the price of goods in the US marketplace and maintaining corporate profits at the cost of diminishing US manufacturing and consequent loss of employment here. I live in the Rust Belt and, at 67 years old, I’ve seen this first-hand. If the tariffs result in higher prices due to more manufacturing and resultant increases in employment opportunities here and not outside the US, so be it. WalMart may have some issues but, oh well…

        • 0 avatar
          Big Al from Oz

          bullnuke,
          Yes prices will rise a bit, but you’ll have less exports as well.

          If you look at prices of goods and services I think you’ll find that a 1% increase in goods equates to a loss of 0.29% of jobs.

          So a measly 4% increase in good and services will cost more than 1% of American jobs or 2.5 million jobs.

          To this the lost jobs due to tariffs imposed on US goods exported and the US has a lot to reconsider here.

          The US will lose as will others.

          • 0 avatar
            DenverMike

            @BAFO – You’re missing the point of all of this is to lower tariffs abroad for US goods, including autos.

            Playing Hardball, is how things get done in business, once you know your company’s value, in this case, in the global market.

            So if you consider the US a “business”, and importers “vendors” that also use some of your products, you want a CEO that’s going to cut the best deal that’s fair for both sides, not lopsided favoring the importers, like we currently have had.

            The US buys a great deal of import product and it’d be nice of we didn’t get the door slammed in our face trying to sell in the same countries we buy from.

        • 0 avatar
          ect

          bullnuke, the tariffs will act to raise the price of key raw material inputs to US manufacturers – the companies that actually export – which will make high-value US manufactured goods less competitive in global markets.

          Meanwhile, retaliatory tariffs by China, Canada, Mexico and the EU will target agriculture and high-value manufactured goods, to make those US products less competitive.

          Neither of these is a desirable outcome for US workers/taxpayers.

  • avatar
    redapple

    Take a deep breath, relax and think.
    Bore down a level or 2 into the facts of the tariffs.
    Many news report state your beer can will cost more, your foreign car may cost more -hype- scare – panic – oh my.
    The overall intent is to EQUALIZE the unfair tariffs countries have with the USA. Equalize !!!
    A US made car going into Germany should have the SAME tariff as a car that is going from Germany to USA.
    THAT IS NOT THE CASE NOW !!!
    OK. Got it?
    Did I clear things up a little.

    Queue hate storm in 3 – 2 -1 -now………….

    • 0 avatar
      tnk479

      Are there any websites where tariff rates and international trade are easily visualized?

    • 0 avatar
      Astigmatism

      You’ll have to point me to the 25% tariffs imposed on auto imports from the US by Germany, Japan, Mexico and Canada.

    • 0 avatar
      tombalas

      Equalizing tariffs won’t do much now. Decades ago American manufacturers responded by manufacturing overseas for overseas markets. That’s why there are few Chevrolets in Germany – GM made Opel cars for that market. One positive thing about import tariffs is that foreign manufacturers will hopefully respond as our companies did – relocating their US market production to the US. They do so now, but they’ll do a lot more going forward. And since the US doesn’t export that many cars, it may turn out to be a boon for US manufacturing.

      • 0 avatar
        golden2husky

        It will be a profit boom because now that imported steel costs more the US manufacturers will jack up the cost of their product because they can. In the end there will be little increase in American output but we will all pay more for many products. The first impact of course was the hammering my investment portfolio takes every time The Idiot tweets his “mind”set…

    • 0 avatar
      Michael500

      GREAT post. Glad to see adults on this site. Getting tired of the no-nothing Millennials/leftists posting sophomoric comments. Wow, did they stop teaching Economics 101 in the last 20 years?

    • 0 avatar
      Big Al from Oz

      redapple,
      There are far more issues to be looked at other than the dollar and cents aspect of trade.

      Eg. Korea is accepting vehicles built to US standards and Korea has removed taxes. The US will not accept Korean vehicle standards and retained the 25% import tariff on pickups. Fair? Not.

      The US must remove the technical and administrative trade barriers. As these are unfair and have a dollar value as well.

      Look at trade objectively. The US imposes the most technical and administrative barriers in the world. Trade is far from tariffs only.

      • 0 avatar
        DenverMike

        The technical differences are not the fault of the US. In any case, the “differences” at this point, are hardly worth mentioning. We’ve had an influx of cheap foreign brand’s disposable compacts for decades, and we’re still getting them.

        • 0 avatar
          Ce he sin

          “– There hasn’t been much incentive for Big 3 automakers to chase global sales, with Europe’s tariffs being a huge deterrent. Plus lack of radically tiny engines for most models, diesel or not.”

          Not sure what you’re on about here. The tariffs applied by the EU are only 10% of the value as at importation and don’t seem to be much of a deterrent to BMW and Merc, both of whom export considerable numbers of vehicles from the US to the EU. There are only two remaining US owned car makers and of these GM has pulled out of Europe. Ford have a substantial manufacturing presence throughout Europe and don’t need to import vehicles from the US, especially when their US production is increasingly unsuitable for sale in the EU. Not sure what you mean by “radically tiny” engines, but Ford have been making engines down to about 1 litre for many decades, as they have diesels, so lack of engines isn’t a problem for them.

    • 0 avatar
      Ce he sin

      Time to take an even deeper breath.
      Tariffs are paid by the buyer. BMW and Merc manage to export significant numbers of cars from the US to the EU regardless of the tariffs imposed thereon. In the hypothetical case of tariffs imposed by the EU on US made cars being reduced to the levels charged by the US(which are in any case optional, cars made in Canada and Mexico can be imported without tariffs, BMW and Merc buyers in the EU would therefore benefit. US car makers would not benefit as their US production is unsuitable for sale in the EU and no amount of tariff reduction would make it so.

      • 0 avatar
        DenverMike

        Are you even listening to yourself? The EU fiercely protects its auto industry, and its the main reason US cars are so “unsuitable for sale” in the EU, even if “US market” Toyotas, Nissans, Hondas and such.

        Mercedes and BMW are obscenely profitable, in case you haven’t noticed. US built versions for sale in Europe aren’t priced 10% higher than their EU “domestic” counterparts.

        The simple fact the EU (trade officials/chancellors) are so deeply offended by the thought of lowering their auto import tariff, to a fair and even level with the US (import tariff) really says it all.

        • 0 avatar
          Ce he sin

          Oh dear. I think we’re back to the idea that “any standards that differ in any way from US ones are protectionism, but not vice versa”

          For a long time cars were a luxury in many countries and therefore taxed as such, as was their fuel. Nowadays many places are doing their bit in reducing CO2 emissions which also results in large, thirsty vehicles being unfavourably treated which in turn impacts on US vehicles. On the other hand, it doesn’t seem to bother Japanese or Korean makers much. But you seem firmly wedded to the “protectionism” theory so we’ll have to turn our attention to Australia. It’s a place like North America in many ways, with long distances, relatively cheap fuel and a liking for pickups. So the F150 is a big seller, right? Nope. Not a one sold. Why? Because the Aussies drive on the left. There’s a prohibition on the sale of new lhd vehicles. Ford don’t bother with rhd F150s so they’re not normally sold in Australia (you can get them specially converted at enormous cost). This doesn’t bother Ford because they sell the Ranger instead which is conveniently made in rhd Thailand. Nonetheless Ford US is being deprived of an export market. Protectionism again?

          • 0 avatar
            DenverMike

            Larger, US exclusives, are what would happen in most any market that would allow consumers to (for the most part) freely decide. There’s still a relative huge penalty and price gap, going from a Corolla to a Tahoe or well equipped F-150.

            And if you’re implying Euro regulations, and the negative impact they’ve had on bigger vehicles from “abroad”, was not totally
            by design, let me just remind you the EU tariff is 400% greater than the US tariff on import autos.

            Korean and Japanese autos don’t sell in Europe nearly at the rate they sell in the US.

            Europe only allows, or strongly encourages autos that are about the closest to the opposite of what consumers would naturally want.

            A lot of “smaller” US exclusives would sell good in Europe if it wasn’t for tariffs and non tariff barriers, like lack of tiny engines, and or diesels.

            One good example is how much French and Italian cars were an embarrassment next to US and Japanese cars when they appeared in the US for a short time.

            Plus Europe has only been concerned with CO2 emissions in recent decades. What about the previous? The US forced catalytic converters/ERGs by the mid 70s? The EU? Early ’90s!

            Australia leaned totally towards Euro cars and regulations, probably for good reasons. Still they’re had a robust, domestic Muscle Car market for decades.

            The F-150 and fullsize US pickups, including Tundras are totally in demand in Australia, if you consider the relative few that do sell there, but at exotic car prices, basically 300% of US sticker prices.

        • 0 avatar
          Lou_BC

          “The EU fiercely protects its auto industry”

          Citations required……….

    • 0 avatar
      ect

      redapple, as it is now, ITC data shows that BMW exports 3 times the number of US-made vehicles to non-NAFTA markets that GM does, and that more than half of GM’s exports are to the Middle East.

      BMW, M-B, Honda, Nissan and Toyota all export a much higher percentage of their US-produced vehicles to non-NAFTA markets than do the D3.

      Tariffs are not going to change this reality. But they will raise the price of raw material inputs to manufacturing companies across the economy, which will inevitably lead to US consumers paying higher prices. This will also make foreign goods more price-competitive in the US

  • avatar
    Robbie

    We tax imported light trucks (SUVs and pickups) at 25%. This is the profitable part of the market, as is illustrated by Ford’s recent decision to stop producing cars. This rate is higher than the EU’s. We simply use protectionism to keep the big 3 alive.

    It is not clear if we want a different status quo than the one we currently have. That is, we may not *want* to equalize tariffs, unless we are willing to in the long run expose the big 3 to foreign competition (and possible bankruptcies) in a segment that is not particularly technologically challenging to construct (especially pickups).

    • 0 avatar
      Art Vandelay

      in a segment that is not particularly technologically challenging to construct (especially pickups).

      If it isn’t challenging, where is my aluminum bodied, twin turbo BMW that I’m not afraid to own after the warranty is up?

    • 0 avatar
      gmichaelj

      “…we may not *want* to equalize tariffs…”

      I think I am willing to give that strategy a try. I think the ‘noblesse oblige’ foreign trade strategy (we gave more than we got in return) was necessary during the cold war to build up allies around the world. During that time, that generation of 1percenters found out how much they enjoyed low cost global labor and lax international regulations. But if we want to keep high living standards for all of our citizens, then we need a mental reset on both sides. I like the idea of 1 on 1 trade treaties: these can be looked at regularly and adjusted/enforced.

      “…unless we are willing to in the long run expose the big 3 to foreign competition (and possible bankruptcies) in a segment that is not particularly technologically challenging to construct (especially pickups).”

      With the reputational lead they have, in the US market? I don’t think they are endangered. The Tundra and Titan haven’t gotten far and they are both produced here. I think the Tacoma, despite being inferior to the new GM twins, still sells well because it was the quality piece in this segment for a long time. Of course there are always some people who buy foreign names to show their ‘sophistication’.

      • 0 avatar
        28-Cars-Later

        “I think the Tacoma, despite being inferior to the new GM twins”

        How so?

        • 0 avatar
          gmichaelj

          NOT having compared them myself – pretty much every review I have read or seen on comparison between the two. best case I saw/read for Taco was large after market support and off-road rock crawling.

          GM twins have more powerful/fuel efficient engines and better driving dynamics IIRC.

      • 0 avatar
        Robbie

        Well, a higher living standard would be served by free trade. This is the consensus among economists. We of course are better off selling Iphones to the world at $500 profit a pop than we are exporting manual labor intensive products. The notion that a high living standard is somehow served by tariffs is faulty.

        Currently, we safeguard Detroit by having our 25% tariff. With the big 3 specializing in our high displacement, low MPG, high income, low gas price environment, we have virtually no domestically produced vehicles to offer the world; but the world has a lot to potentially sell to us.

        But yes, I can easily see Mahindra make a high quality pickup truck that will catch on first in the rural areas, where people may start to like the agricultural equipment brand better than the big 3 pickups that are now often driven by urban cowboys in designer jeans.

        If I were the CEO of John Deere, I’d look into producing a pickup truck right away; but that is a different discussion…

        • 0 avatar
          tnk479

          Okay, I hear you. I took Macroeconomics as a requirement for my undergraduate degree and I was assigned to read a book that explained why free trade leaves everyone better off. However, I am beginning to reconsider whether all of the costs of lost jobs are really accounted for by the pro free trade argument. What about the dignity and personal development that work provides people? What about the cost of the social safety net that the US and all developed countries have put in place? Are we better off that Apple has 300 billion US Dollars in profits parked overseas that it has no idea what to do with except for share buybacks? Would the USA be better off if some of that money was put into manufacturing those phones domestically, providing jobs and all of the second and third order benefits that those jobs offer to the workers and their communities?

          • 0 avatar
            Astigmatism

            “What about the dignity and personal development that work provides people?”

            It’s great. Just ask people who work for Boeing, Caterpillar, or any of our various auto plants that produce vehicles for export.

            “What about the cost of the social safety net that the US and all developed countries have put in place?”

            It’s going to get a lot more costly with a bunch of needless trade wars.

            “…it has no idea what to do with except for share buybacks”

            Apple conducts buybacks because they’re tax-advantaged. If you’d rather they paid their employees with that money instead, then changing the tax code so that it’s even more preferential to investment income instead of wage income is a pretty silly way to go about it.

          • 0 avatar
            manu06

            I’ve done a 180 and agree with your conclusions tnk479.
            I moved to a town that was decimated by NAFTA.
            The only thing that spurred growth were low interest
            rates and now that rates are rising again I look for
            the consumer economy to start slowing down in the
            next year. Ask yourself, how many economists predicted
            2008 with any reasonable degree of accuracy ?

          • 0 avatar
            DenverMike

            @Robbie – SUVs aren’t “Trucks” as far as tariffs go, only pickups and cargo vans.

            You’re confusing the CAFE definition.

            “Protection” isn’t Big 3 specific either. Any foreign brand selling in the US can potentially profit from US tariffs.

            There’s no reason to imagine foreign/offshore brands don’t, especially when you look at which global “trucks” (Mahindra, Sanggyong, etc) would potentially enter the US market (minus tariffs, and yes it’s a very short list) and what brands they would compete with mostly.

            That would include Hyundai, Toyota, Subaru, Hondas, Nissan, Mazda, etc, to a great extent, and not just vs pickups but CUVs and others.

            Verse US fullsize pickups (especially Tundras and Titans)? Sure why not? Probably verse BMWs, Jaguars, Land Rovers too…

            In fact the Big 3 lose more than they profit from the Chicken tax when you consider what they spend to sell (or not sell) their global vans and pickups in the US.

          • 0 avatar
            ect

            Astigmatism and manu06, the fact is (per BLS and BEA data) that US manufacturing out, in constant dollars, has doubled since NAFTA was signed. In the same period, manufacturing employment has fallen by 1/3. What’s killing manufacturing jobs is technology, not trade.

            Technology has created many more jobs than it has destroyed, but they’re different jobs, requiring more skill. Nonetheless, the US reached full employment in 2016.

          • 0 avatar
            Lou_BC

            I have to agree with @ect. Technology and automation is what has killed jobs. My hometown has not grown in size appreciably in the past 50 years because of it. We have a few big saw mills that have replaced dozens of mills all with a huge downsizing in staff.
            “There are jobs being lost — but a lot of that is due to technology,” said Innes. “Mills are getting increasingly efficient and they are using automation, and a lot of that automation is replacing people.”
            Instead of unskilled manual labour on the “green chain” mills are hiring engineers, mill wrights, computer technicians etc. Raw log exports account for maybe 2000 job losses in BC so one cannot blame offshoring of work and we cannot blame cheep imports.

            Ironically, recent USA tariffs on Canadian lumber have not hurt our companies. The USA needs lumber and they cannot produce enough of it. That means USA consumers are paying the tariffs not us.

        • 0 avatar
          dwford

          Not sure that I agree that we have nothing worthy of export. Ford and GM have spent the last 10 years commonizing their platforms and drivetrains with the rest of the world – especially Ford. It’s just that these companies already have huge operations overseas already, so there is no need to export from the US.

          As for the higher living standard through free trade. That may be true on a macro level when you sit at a desk and look at reports, but tell that to the factory workers that lost their jobs due to free trade. “Sorry, buddy, you’re just gonna have to take one for the team so everyone else around you can live better.”

          • 0 avatar
            volvo

            10 years of producing acceptable quality products is not long enough.

            At a minimum 25 years to erase the reputation the big 3 earned from 1970 to 1995. I will grant that it only took Audi 20 years.

            When granddad stops telling the grandchildren about the plastic drivetrain part that broke just out of warranty then the recovery begins.

            On the other hand it appears that German and Japanese automakers are in a race down with cheapening content so maybe the playing field will level pretty rapidly.

          • 0 avatar
            gmichaelj

            ” As for the higher living standard through free trade. That may be true on a macro level when you sit at a desk and look at reports, but tell that to the factory workers that lost their jobs due to free trade. “Sorry, buddy, you’re just gonna have to take one for the team so everyone else around you can live better.” ”

            Exactly – free trade doesn’t do a thing for distribution of income or wealth, by effort, – those who are positioned to benefit can, those who are not positioned cannot.

            I always enjoy hearing how hard white collar workers are working when they put in a 50 to 60 hr work week in their air conditioned offices.

            I know it’s from a liberal rag, but you might read about how hard accounting partners work to justify their 6-figure incomes: https://www.theguardian.com/news/2018/may/29/the-financial-scandal-no-one-is-talking-about-big-four-accountancy-firms

          • 0 avatar
            Big Al from Oz

            dwford,
            80% of those factory jobs have been lost to automation. Farming, even 100 years ago employed huge numbers, now here in Australia it takes 2 people to farm 2 000 acres. Manuafacturing is no different.

            And, how can the US state it has preference to manufacturing jobs, well, just because it’s the US? China has lost over 30 million manufacturing jobs in the past decade.

            All countries are confronted with the same issues with manufacturing jobs. It is not an American only problem.

            The US must compete like everyone else and stop this whining and crying about it inability to compete.

            Maybe some real change in the way uncompetitive US industries operate will make them more competitive. But, isolating the nation from true competitive forces will only encourage inefficient practices that will further degrade US manufacturing.

          • 0 avatar
            golden2husky

            Volvo, well said. Because Detroit made many screwups there is definitely the ‘lost generation” that will never look at domestic brands. Those people are now in retirement communities and nursing homes. When they die off, the stories that meant much to them but are really irrelevant today will die with them. Today’s car buyers never had to deal with such problems so those newer buyers don’t carry the baggage of thirty years ago.

        • 0 avatar
          gmichaelj

          ” This is the consensus among economists. ”

          Yes, I am familiar. But this assumes that the economist (thoughtful people to be sure) can actually measure and verify their hypotheses.

          Economics evolves as does everything else. I think you’re going to see that your consensus will start to come with more and more caveats, and lead to a better model.

          Although I am certainly not a Trumpkin, I think he is stirring things up and isn’t enslaved by conventional thinking from experts.

          We may be better off having had him give voice to a Nationalistic economic outlook – something the mainstream isn’t giving an objective look

        • 0 avatar
          gmichaelj

          My reply somehow ended up below

        • 0 avatar
          Big Al from Oz

          Robbie,
          Global pickups are hugely variable. I think your Mahindra comment is very much a inaccurate depiction and not representative of the global market.

          Like the US, affluent countries (and there are dozens) can afford really nice pickups.

          The last US designed global pickup was the Frontier. Prior to that US pickup design reigned. Now, even US midsizers are heavily global (except the Taco, which the next Taco will use Toyota’s international platform).

          The US (Big 3) and the UAW, with government have placed US the Big 3 in an uncompetitive position.

          A lot of pain is needed with restructuring to rectify the uncompetitive position the Big 3 find themselves in.

          I think Americans need to realise that if you are “losing” doesn’t mean someone is cheating or you are nice and throwing the game.

          It seems most areas of industry where the US is not competitive the US has huge differences in how that industry is controlled. Look at home first and see what you can do to fix your house rather than blaming all.

          • 0 avatar
            DenverMike

            @BAFO – There hasn’t been much incentive for Big 3 automakers to chase global sales, with Europe’s tariffs being a huge deterrent. Plus lack of radically tiny engines for most models, diesel or not.

          • 0 avatar
            DenverMike

            We don’t really have a market for “agricultural” pickups. We have used pickups and other off road equipment for that.

            To go on the road, besides crash safety and emissions, which shouldn’t be a problem, US Lemon Laws would likely kill the deal.

  • avatar
    Astigmatism

    Of course, one of the main points of protectionist tariffs is that they allow domestic producers to increase prices – but I’m sure that won’t happen here, out of the goodness of domestic steel producers’ hearts.

  • avatar
    gasser

    While we work on EQUALIZING tarries, lets also work on eliminating artificial barriers, like differences in equipment and crash tests, so that any car produced in a modern plant and country can be sold worldwide without modifications. This would move a lot more U.S. product to Japan and Europe.

  • avatar
    Big Al from Oz

    Matt, I can appreciate and respect your far right views.

    But please don’t publish complete trash, or as your Mesiah, Trump would say “fake news”.

    Now, what countries are stabbing each other in the back?

    If you bothered to research you would see how nations, ie, Germany, Mexico, Canada, even the EU are formulating (collaborating) a plan of attack. How does this equate to back stabbing?

    Please, with what journalistic integrity you have understand the concept of sincerity in what you produce.

    To the TTAC Editor. WTF do you edit?

    • 0 avatar
      Lou_BC

      The whole “stabbing each other in the back” thing got me too. If anything, Trumpenomics has made countries around the world come together in mutual cooperation.

      • 0 avatar
        Big Al from Oz

        Lou,
        It seems there are many Americans, ie TW5 and those of his ilk that only view “US Media” on Trump. Trump makes for good TV and Twitter.

        He gives this impression he cares about the worker. I don’t buy this.

        I have read the EU is moving closer to China, Pacific nations are moving away from the US as well. Asian nations are not sure now that they will have US support.

        I do read many economists concerned about a Trade War destroying the global economy. But, I also see many nations external to the US working together to overcome the unnecessary obstacles and tactics the US is using to stifle trade. I do think the rest of the World will work together in trade and the US will be worst off. What the US produces can be bought from many other nations or they will ramp up the manufacture of what is hard to obtain. The Chinese have already started developing an advanced chip manufacturing industry since the ZTE issue. This will really hurt the US exports. Imagine advanced computer chips at half the price. This is what Trump and his economic goons have done already to the West.

        Trump is disruptive and divisive in how he operates and has can’t think laterally, abstractly or decisively. He flips and flops and can’t make a decision.

        We heard on our news here in Australia that no one wants to fill in the US Ambassador under Trump. We have not had one since Trumps election, one of the closet US Allies with Canada and the UK.

        • 0 avatar
          volvo

          To Big Al and others

          I probably should follow my better instincts and stay out of this political digression on an automotive forum however

          I am a US citizen but don’t feel I really have a dog in this fight. Trump, tariffs, open borders, free trade, trans-national security agreements are all complex and discussions have become highly polarized.

          As has been mentioned by others the elephant in the room is productivity/employee especially in manufacturing. Look at some youtube auto assembly videos to see how this has advanced.

          I agree that tariffs are counterproductive even when used to level the playing field. Large discrepancies in national support for certain industries, non financial tariffs (regulatory restrictions to market entry) and differences in income/cost of living between nation make leveling the field almost impossible to quantify.

          I do believe that the US is slowly losing power and influence in world events. This is a result of industrial advancement in other countries and US “burn out”.

          I remain puzzled by the decades (not just Trump era) of animosity towards the US by many 1st and 2nd world citizens’ Perhaps this is a combination of idealism and historical ignorance. In the future, when the US is a lesser power much of the world will still need to work with/under whatever replaces the US position.

          Given the current set of global powers and their agendas we should all think carefully about what new system will replace a relatively benign (in historical terms) US hegemony that has been in place since 1946.

          History marches on.

          • 0 avatar
            Big Al from Oz

            Volvo,
            Thanks for the comment.

            I’m of the belief the US still has much potential. But I also believe the US is at a tipping point.

            I don’t believe that the current President is taking the US down the correct path in maintaining maximum US influence.

            You pointed out why you don’t understand some of the previous nagative sentiment towards the US. Well the US contrary to many views profited extensively from it’s previous dominance. Some around the World percieved this as US abuse. Fortunately enough saw this and became more like the US.

            Now many of the countries that wanted the life of the US are competing, like the US. This is now a percieved fear issue in the US. The US is becoming more reliant on others and not the other way round.

            Control is what its about. But Trump needs to understand collaboration and consensus. This is how the rest of the World has been operating for decades.

            The US needs to have trust in its friends and Allies. Trump is divisive and is polarising the US and the World.

  • avatar
    cdotson

    The headline is fake news. No such thing as carbonized iron. Elemental iron does not exist in nature; iron ore must be DE-carbonized to make steel.

  • avatar

    Foreign car brands will be inclined to move (even) more production capacity to the U.S. Which is good! Then again, Trump should ask himself why Mercedes (that he hates so much) has become such a coveted premium brand. A quality product despite the fact that its cars are already more expensive without even taxing higher import tariffs? Superb marketing? Mercedes is sponsoring events like the NY Fashion Show and the U.S. Open… Cheapskate Cadillac thought that moving its HQ from Detroit to NY would cause a fresh breeze of change. Go figure.

    • 0 avatar
      Astigmatism

      Except that cars produced in the U.S. suddenly need to be made with steel and aluminum that are substantially more expensive than they are elsewhere in the world, and will be subject to punitive tariffs if exported to other countries. So, considering that the over 80% of global new car sales are outside of the U.S., why would you move production capacity into it?

    • 0 avatar
      ect

      voyager, a tariff on steel will reduce auto production in the US, not increase it. The tariff raises the price of steel and aluminum, which carmakers use a lot of.

      The tariff on imported vehicles is not affected, so foreign-made cars get a price advantage in the US.

      Brilliant strategy – NOT!

  • avatar
    Sub-600

    “From each, according to my needs” – Bernie Sanders, “Mein Kapital”

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