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A comment on US Administration announces 34% tariffs on China – 20% on EU. Parent comment

Re:US Administration announces 34% tariffs on China – 20% on EU by refurb on Thursday April 03, 2025 @02:29AM (#43565545)
The missing piece is not all costs are passed on to consumers.

Company absorb costs all the time. If you think cutting your price by 10% will boost sales by 20%, you do it because total profit is higher even though per unit profit is lower.

And the reverse is true - companies might increase prices and accept lower volume.

Not to mention not all items are interchangeable. Is a car made in Mexico worth the same as the same model made in Germany?

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Re:US Administration announces 34% tariffs on China – 20% on EU by briandear on Thursday April 03, 2025 @04:15AM (#43566495)
The Q5 is made in Mexico.
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Re:US Administration announces 34% tariffs on China – 20% on EU by yibg on Thursday April 03, 2025 @03:00AM (#43565837)
So basically a lose lose from company and consumer perspectives. Either company makes less profit or consumers pay more or a mix of both.
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Re:US Administration announces 34% tariffs on China – 20% on EU by naijaboiler on Thursday April 03, 2025 @07:44AM (#43568210)
Congratulations you have just re-discovered an Econ 101 concept called deadweight loss
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Re:US Administration announces 34% tariffs on China – 20% on EU by XorNot on Thursday April 03, 2025 @03:00AM (#43565835)
Low cost items, of the type the vast majority of the population are quite sensitive to the price of, have almost no margin on them to start with. There isn't 10% to cut.
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Re:US Administration announces 34% tariffs on China – 20% on EU by refurb on Thursday April 03, 2025 @03:21AM (#43566012)
True, but a $5 trash can with a 10% tariff is $5.50
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Re:US Administration announces 34% tariffs on China – 20% on EU by XorNot on Thursday April 03, 2025 @03:35AM (#43566131)
The $5 trash can is made in China, which is receiving something on the order of a 50% tarriff.

And now that's 50c extra in taxes to the government for every other part of the supply chain consuming $5 trash cans as an expense.

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