Issues with Tariffs, both Mexico AND Canada [ADMIN WARNING: NO POLITICS; MEMBERS ALREADY BANNED FOR IT]

[Kimpossible12]

I saw on here a lot of posts about the upcoming tariffs, and I just wanted to mention that while all the posts I read exclusively mentioned the Mavericks Mexican involvement, I also wanted to tell everyone that Canada is definitely involved as well.

I work at Arconic in Davenport, IA. We make the aluminum alloys for all the Ford bodies and frames. I can tell you, without hesitation, that 90+% of all our raw or "prime" aluminum originates in Canada. I have unloaded thousands of tons from railcars myself. No raw aluminum=no aluminum alloys. We do a fair bit of recycling/reusing but at best thats 76%, and thats not perpetually sustainable. We need millions of tons a month of prime aluminum.

So, with the vehicle being assembled in Mexico, with aluminum sourced from Canada, it could be, functionally, a 50% tariff.

Not trying to be political. I am stating provable facts. Not solutions.

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[Kimpossible12]

This usually results in my Maverick being searched 2 or more times in the 8 hour drive between my homes in Green Valley AZ and Álamos Sonora MEX. Oh well, it's necessary. Cartels are too heavily armed here.

Attending a funeral here stateside on the East Coast. Fly back to Arizona on Wednesday. We'll see how the drive down back to Álamos goes on Thursday.

Peso steady at about 20 to 1 .

Hey fellow Green Valley resident! My neighbor was up 19, closer to Tucson the other day and counted 26 CAR CARRIERS hauling Ford vehicles (mostly Mavericks) in ONE HOUR!! I guess they we're haulin' a$$ trying to save $$$!!!

 

[RR - All the way]

It's a troll. But in trolling, there is always a legit truth.

Always???? Really??? I do not think so. Wait, is my response a troll because it contains truth as always??

 

[commadorebob]

Always???? Really??? I do not think so. Wait, is my response a troll because it contains truth as always??

With Greenland, we went from "he's trolling" to "crap, he's serious!" So, I never discount any of his trolls.

That said, Canada won't be our 51st state. Maybe 51-56....

 

[Probity]

If Ford ships truck parts from the US to Mexico valued at $12,000 (on the US - Mexico Customs Declaration) and Mexico assembles the parts at a cost of $8,000, the tariff applies to the $8,000 and not the declared value of $20,000 ($12,000 + $8,000) from Mexico - US. Otherwise the tariff is being applied to parts ($12,000) manufactured in the US. Even if Ford sells the vehicle for $30,000 in the US, the tariff would be $2,000 (= 25% of $8,000). The $12,000 and $20,000 are referred to as Transfer Charges. They are immaterial to Ford's profit and are often set so as to minimise Ford's global tax liabilities. The tariff is an ad valorem tax not a sales tax.

If on the other hand a good contains no US parts (Canadian softwood for example), the tariff applies to the value on the Customs Declaration from Canada - US.

So, car prices won't increase by the tariff times the MSRP but something significantly less. Goods made 100% overseas will, however, see there cost/price by 25%, depending on how much the importer is willing to absorb.

I think you’re onto something here, I’m just not sure what exactly that is yet……

How new tariffs would be administered seem fairly straight-forward for single unit cost/”assembly” cost items – that avocado or bottle of tequila from Mexico, that bbl of so-called sour crude or length of dimensional lumber from Canada. But autos are a real dog’s breakfast of parts costs/labor costs.

I have zero idea how auto exports from Mexico/Canada would be administered regards the calculated amount the ‘importer’ would have to pay. But I’m pretty confident as you are that it’s not as simple as (MSRP x 25% = tariff impact). I have seen lots of so-called news articles the last couple of days using the “$6250.00” number – 25% of a hypothetical $25,000 auto. Started with an S&P Global Mobility article. I had to read the S&P article to understand they weren’t talking about 25% of a $25k MSRP auto, the $25K is an assumed ‘landed’ cost (manufactured value/value added outside the US).

I’m not sure Ford or GM even know yet how auto tariffs will be implemented. First there was NAFTA, it was complex, now we have the even more complex USMCA with its ROO (rules of origin), RVC (regional value content), LVC (labor value content – which evidently includes not just parts labor costs but also final assembly labor costs). Or the MFN tariff (most-favored nation tariff currently 2.5%) as an alternative to following ROO requirements.

 

[KFB57]

I saw on here a lot of posts about the upcoming tariffs, and I just wanted to mention that while all the posts I read exclusively mentioned the Mavericks Mexican involvement, I also wanted to tell everyone that Canada is definitely involved as well.

I work at Arconic in Davenport, IA. We make the aluminum alloys for all the Ford bodies and frames. I can tell you, without hesitation, that 90+% of all our raw or "prime" aluminum originates in Canada. I have unloaded thousands of tons from railcars myself. No raw aluminum=no aluminum alloys. We do a fair bit of recycling/reusing but at best thats 76%, and thats not perpetually sustainable. We need millions of tons a month of prime aluminum.

So, with the vehicle being assembled in Mexico, with aluminum sourced from Canada, it could be, functionally, a 50% tariff.

Not trying to be political. I am stating provable facts. Not solutions.

That will be the end of the Mavericks in Canada!!!

 

[mspmms]

It looks like a deal is in place with Mexico!! Mexico has agreed to send troops to their border to help curb the fentanyl. Mr. 47 says they have one month reprieve. This is great news all the way around.

Very pleased all those who are waiting on their '25's will not have to pay more.

Appears Canada too:

 

[semicolin]

I wonder who the next temper-tantrum will be with in thirty days. Nobody needs this level of instability.

 

[MakinDoForNow]

I think you’re onto something here, I’m just not sure what exactly that is yet……

How new tariffs would be administered seem fairly straight-forward for single unit cost/”assembly” cost items – that avocado or bottle of tequila from Mexico, that bbl of so-called sour crude or length of dimensional lumber from Canada. But autos are a real dog’s breakfast of parts costs/labor costs.

I have zero idea how auto exports from Mexico/Canada would be administered regards the calculated amount the ‘importer’ would have to pay. But I’m pretty confident as you are that it’s not as simple as (MSRP x 25% = tariff impact). I have seen lots of so-called news articles the last couple of days using the “$6250.00” number – 25% of a hypothetical $25,000 auto. Started with an S&P Global Mobility article. I had to read the S&P article to understand they weren’t talking about 25% of a $25k MSRP auto, the $25K is an assumed ‘landed’ cost (manufactured value/value added outside the US).

I’m not sure Ford or GM even know yet how auto tariffs will be implemented. First there was NAFTA, it was complex, now we have the even more complex USMCA with its ROO (rules of origin), RVC (regional value content), LVC (labor value content – which evidently includes not just parts labor costs but also final assembly labor costs). Or the MFN tariff (most-favored nation tariff currently 2.5%) as an alternative to following ROO requirements.

The big thing to consider is that a TARIFF is a VAT (Value Added Tax) assessed by an EXTERNAL TAXING ENTITY on goods received and not collected on costs of any kind collected by a prior taxing entity. In theory it takes some (maybe more maybe less) of the tax collected from the country that increased the value and moves it to the importing country. Yes it could increase the total value of the product to the end purchaser.

 

[Probity]

Appears Canada too:

I initially thought this was a "spoof" - but evidently it ain't.
Trump pauses tariffs on Canada for at least 30 days, Trudeau says

 

[Ron Neal]

If Plan A fails, Plan B is to go to the pub and think of Plan C. I do a lot of Plan C thinking.

For me Pub=British beer and I can get all the way to plan G or H before they close.

 

[fossil]

It seems that the stock market is the real seat of power. stocks down around the world, tariffs delayed/suspended. just wait for the gas price effect.

 

[sprubs]

I initially thought this was a "spoof" - but evidently it ain't.
Trump pauses tariffs on Canada for at least 30 days, Trudeau says

I posted the playbook a while back. maybe I need to dig that sucker up again!

 

[JAFO]

If you already own a Maverick...why care?

You are right ! I have my 2023 which I waited 480 days for, and I am keeping it till the wheels fall off say in 15+ years. Unless it rust out like the Ford Pinto once owned.

 

[Glen Baker LLC]

You are right ! I have my 2023 which I waited 480 days for, and I am keeping it till the wheels fall off say in 15+ years. Unless it rust out like the Ford Pinto once owned.

Hey, some old guy out here still has his. A country squire too.
I always liked the Pinto station wagon.

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