Trump's tariffs and immigration restrictions are forcing companies to move production overseas...
Trump’s trade folly
President Trump wants Ford to lose money. And Apple to hike prices.
As Trump’s protectionist trade policy intensifies, inevitable economic distortions are materializing.
with the Ford Focus Active now subject to Trump’s 25% tariff on imports from China, Ford has decided to give up on selling the Focus in the United States completely. The factory in China will still produce the Focus for Asian markets, and another Focus factory in Germany will produce the car for sale in Europe. But Americans won’t be able to get the once-popular model, except on the used market.
Trump thinks the solution is to build the Focus in the United States. “This car can now be BUILT IN THE USA and Ford will pay no tariffs!” Trump tweeted on September 9. But Ford has already tried that, and lost money doing so.
Apple recently said the next round of Trump tariffs “will result in lower U.S. growth and competitiveness and higher prices for consumers.” In a filing with the office of the US Trade Representative, Apple said the additional tariffs on Chinese imports will raise the cost of roughly two dozen types of products, including the Apple Watch, AirPods, HomePods, Beats, and a variety of components that go into other products.
Trump implored Apple, as well, to move production from China to the United States.
Trump is apparently unaware that in 2011, the late Steve Jobs, then Apple’s CEO, told President Obama that the United States didn’t have nearly enough engineers to support Apple’s vast assembly operations. He urged better efforts to lure engineers from other countries. But Trump favors stricter limits on legal immigration, not looser ones.
Harley-Davidson is further along in its efforts to deal with the blowback of Trump’s trade wars. The company decided over the summer to shift production of motorcycles destined for Europe out of the United States to evade retaliatory tariffs Europe placed on imported U.S. motorcycles, in response to Trump’s steel and aluminum tariffs. Trump lambasted Harley, saying it “should stay 100% in America.” But again — he’s imploring the company to lose money. No CEO can or should do that.
...there’s a fatal flaw in Trump’s strategy: His tariffs, by necessity, will harm U.S. companies and consumers before they produce enough leverage to extract concessions from China. Trump is basically telling the American victims of his trade policy to buck up and take it. They’re saying no.
Yahoo Finance
?
