The only thing we know for sure is that this action is within the President’s authority.
https://www.axios.com/2025/01/30/trump-tariffs-canada-mexico-feb-1
and the Canadian view.
intercst
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Supposedly, he is still trying to make up his mind about imported oil, but, supposedly, the tariffs on everything from our closest neighbors and trade partners, are a go…until he decides they have “learned their lesson”, and he cancels the tariffs.
Steve
"Export diversification would allow Canada to reduce its dependency on the U.S. market.
“While the U.S. market offers convenience and proximity, increasing uncertainties highlight the importance of exploring emerging and developing markets,” Afesorgbor said. “Diversification would help mitigate risks and create more stable trade opportunities.”
“Enhanced productivity will help them remain competitive in global markets, especially as they diversify away from the U.S”
Yeah, sure sounds like this is a plan to drive down prices,lol.
Getting easier to understand how he bankrupted 3 casinos.
6 Likes
Ford Motor is particularly sucking up to the administration. Ford does make all of it’s most profitable models in the US. The few cheap Mexican models that will be priced out of the market, can be replaced by equivalent, or more expensive, US built models, and Ford takes more money off it’s customers, for zero investment, and zero disruption of existing US operations.
“Ford has the largest US manufacturing footprint," he said. “And so we’re really encouraged about the administration’s positive outlook on the auto industry and the impact on our overall economy.”
Farley added the automaker is “really looking forward” to working with the new Trump administration to boost US employment through more domestic hiring and other policies,
Zukky, zukky, kissy, kissy
Farley blathers about EVs toward the end of the article, but the EV subsidies are sort of irrelevant, because the Mack-E is built in Mexico, so would be hammered by the tariff anyway. I expect the “Blue Oval City” plant being built in Tennessee to build electric F-150s, will be reworked, during construction, to build ICE F-series Super Dutys, because they are staggeringly profitable.
Steve…long Ford Motor, because of their favorable position wrt tariffs.
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Most autos exported by Mexico are made by GM & Ford.
https://www.cato.org/blog/seven-charts-show-how-us-tariffs-would-harm-american-auto-industry
decades of free trade have caused the US, Canadian, and Mexican automotive industries to be highly integrated, with producers in all three countries shipping finished goods and parts across the United States’ northern and southern borders.
many cars sold in the United States are made in Mexico with core parts from the United States and Canada, meaning that much (if not most) of the vehicles’ value comes from work performed by American workers and companies during production.
The North American automotive supply chain is so interwoven across all three USMCA countries that an engine, transmission, or other automotive component might cross the US-Canada and US-Mexico borders as much as seven or eight times before it ends up in a finished vehicle. As a 2017 Bloomberg report documented, this dynamic applies not just to complex parts but relatively simple ones too. In particular, the authors tracked the journey of a capacitor, a simple electrical component in a circuit board, incorporated into a car seat. As Figure 6 shows, by the time the capacitor was embedded in a finished seat, it had already crossed from one North American country to another four times.
the US automotive industry is a great example of the complexities of 21st-century manufacturing and the benefits of globalization
It’s also a stark example of how and why tariffs would harm the modern US economy, including the manufacturing sector and American consumers. Automotive industry experts have warned that the tariffs would quickly “add a minimum of thousands of dollars” to the price of a new car in all three countries.
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Some companies are more exposed to Mexico than others. Two thirds of the cars VW sells in the US are built in Mexico, and most of VW’s supply chain is in Mexico.
Stellantis builds the Jeep Compass in Mexico, with mostly Mexican parts. Price the Compass out of the market, and the dealers will push prospects into a Detroit built Grand Cherokee, 50% US and Canadian parts, and take more money off them.
The cheapest Chevies are small CUVs built in Korea…I have not heard any hard numbers put on Korean, or European products. The next step up is the Equinox, built entirely in Mexico. Chevy Silverado production is spread between the US, Canada, and Mexico.
Ford builds the Bronco Sport and Maverick in Hermosillo. The three cylinder engine is apparently built in China, and the transmission in Livonia, MI. Take those two out of the product line, and customers can be shifted into an Escape, built in Louisville, at the same price point, or, if they want a pickup or the butch looks of a Bronco, the prospects can be shifted into a Wayne, Mi built Ranger, or Bronco, and the company takes an extra $10k off them. All F-150s are built in the US. All F-series Super Duties are built in the US.
Steve
Interesting and make me look at the window sticker of my Acura ZDX. I would assume the Cadillac Lyric will be identical with respect to these numbers.
US/Canadian parts content: 63%
China: 16% (for the transmission mostly)
Mexico: 19% (for example, the motor)
Final assembly: Spring Hill, Tennessee
I wonder how these will be impacted by the tariffs?
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The thing that makes it difficult to work out is they don’t split US vs Canadian content. Mexican product is called out separately.
This is the content information for a new Jeep Compass at a dealer near my home.
The Compass is a dead duck. It’s near end of life anyway, so I doubt the company will invest the time and money to move production. They will just shift prospects into a Grand Cherokee and take more money off them. Jack Welch would be proud. Content info for a new Grand Cherokee at the same dealer.
If we assume half Canadian, half US, then the total tariff works out to about 14%, or $9,200 on a base-model ZDX. Ouch.
We really can’t tell, from here. There is a constant flow of auto parts across the bridge between Detroit and Windsor.
Here is the sticker for a new Chrysler Pacifica minivan. This particular example has a Mexican built engine, but that Pentastar V6 is also built in the US. It’s mostly US/Canadian, except for final assembly. Would Stellantis bother moving assembly to the US? The Pacifica came out in 2017, so it’s getting long in the tooth. It would be the Welchian thing to do, to drop the Pacifica, and shove the prospects into a Grand Cherokee.
Overall, with Mexican and Canadian production effectively locked out of the US market, we would probably see a return to the “shortage” narrative of 2021-22, where automakers, and their dealers, gouged the daylights out of their customers, and made record profits.
Steve
Someone with knowledge of what is going on in TNG’s mind, at the moment, could make a fortune.
Read the URL. When i first pulled this article up, it was about the Canadian dollar and Peso soaring on chatter the tariffs would be delayed until March 1. Now, the article says dollar jumps.
news/dollar-falls-report-us-tariffs- says the URL
Here is a screen capture of an early article about the C$ and Peso rising.
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