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Originally Posted by Ricfutures
Cliff notes version: Increased pricing will most likely lead to lower demand. Lower demand = less production = less workers. Net/net this is a loss for BMW and US, specifically the people employed in these US plants.
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Your assumptions and the conclusions you base on those assumptions are not supported by facts.
According to the article, US Spartanburg plant exported 100k cars to China last year. That’s not even a drop in a bucket for the Chinese market. China doubles and in some cases triples the price of imported BMW cars by the time various Chinese taxes are paid. And yet demand is outstripping supply. With X7 going on line at Spartanburg shortly, US manufacturing capacity is constrained. In fact, they’re hiring and expanding work force in SC.
Therefore, Chinese consumers will pay more, BMW will adjust their pricing models and perhaps even win with new adjusted prices, and US is collecting 25% tariffs on imported aluminum.
Sounds like a win win for US.