China imports what it wants and it needs (what its internal market demands), not what the US wants it to import. Imports exist because there’s a high demand for specific products that are either not manufactured internally, or what is produced ain’t at par (qualitatively, technologically and price wise) with the imported ones. Imports are generated by internal market demand. When internal production doesn’t satisfy the needs and/or expectations of the internal market, the imports increase, while the exports decrease, thus resulting in trade deficit.
No country in the world imports goods for the sake of importing goods; it imports what it really needs.
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So, with someone with DIRECT experience with China Tariffs, (Bet you guys don’t realize there already ARE tariffs on LOTS of Chinese made tools and other stuff, just not cheap things), There was a 10% tax on Lasers pre2016 that was increased to 25% in 2018. So prices we paid for lasers increase roughly 15%. And current administration DID NOT remove the increase. So today, many Chinese laser makers flow their product through Hong Kong, which even though China, is exempt from the increase. And to sell here, prices actually are lower than in 2016. Less profit for the Chinese. Just sayin. And Go buy US made filament.
the answer (blue or red pill?)
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Econ 201. Prices are set by markets, not costs.
… and by taxes and tariffs. But any pricing is based on production costs, shipping costs and reseller costs… so eventually pricing does depend on costs.
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You posted a pic saying “what if I told you any cost increases get passed on to the customer. Always.” That simply isn’t true. Prices (what is payed by the consumer) are determined by markets, not by costs. If everything about economics were intuitive, they wouldn’t need to teach it in school. This is one of those non-intuitive things.
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Put plainly, pricing is a process whereby a business sets and displays the price at which it will sell its products and/or services and may be part of the business’s marketing and sales plan in a specific region or market. In setting prices, the business will take into account the costs at which it could acquire the goods or raw materials required, the manufacturing cost, the target marketplace customs taxes and tariffs, the existing competition and the existing pricing model for similar products/services, specific or special market conditions, its brand reputation and recognition, and quality of the products/services it sells.
Pricing can be set in a number of ways, but ultimately it is dependent upon how much has the business invested (costs) in making that product, on how much has it has spent (costs) to bring it to a specific market, and how lower it can afford to drop its profit margin (costs again)…
If the price for a product is set below its production costs, a business won’t sell on that market, and will move to markets where its products are in demand or where the pricing allows for a reasonable profit margin. So, whether you agree or not, the fact remains that, ultimatelly, price is dependent on costs.
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That is if you ignore supply and demand.
During the pandemic, because of scarcity, corporations significantly increased their prices, causing widespread inflation. When the supply chains returned to normal the corporations kept their prices high - even though their costs are the same as before.
Have you never been to an outdoor event, or to an airport where it costs several dollars for 16oz bottle of water?
A rather common problem in the United States, and around the world, is where competing companies conspire to set prices artificially high.
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Under the new administration, (and the proposed 60% import tax) i doubt that a Chinese company will be able to colude with an American company (or that an American company will be interested to get involved) in order to have lower costs and higher profit margin and simultaneously become wide open to being subject to a federal indictment under US antitrust and anti-competition laws…
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This is the same argument people use to insist that the wealthy cannot be taxed because they will just pass the costs on to the consumer. Yet if one runs the numbers one finds this to be a rather asinine argument. The thing is, taxes are a percentage of profit. Say, if a company and its owner is taxed and they raise their prices to cover the tax, because of the price increase, which will be seen as added profit, they will then owe even more tax. If they then again raise their prices to cover that tax, again their profit and tax goes up. No one can raise their prices high enough to cover their taxes.
Let’s agree to disagree (at least on some points) and let’s wait and see how the new tariffs will play out on American economy and on the costs for the end consumers.
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The purpose of tariffs is to protect domestic industry. Making foreign products so expensive that people will willingly pay for overpriced domestic products. Most of the products made in China and sold in the United States are American companies having their products made in China, where they can avoid environmental, safety, and labor laws. However the head of the new administration is not the brightest bulb in the closet and thinks that tariffs can replace taxes. That dim bulb even thinks that other countries pay the tariff.
The Apple iPhone, an American invention and product by an American corporation is made in China. The tariff on the iPhone will be paid entirely by Americans.
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Luxury and status items like designer sunglasses/handbags/shoes, etc, may have their pricing totally disconnected from the reality of raw materials and manufacturing costs and allow inflated margins, but those are the exception.
Consumer tech has fairly thin margins. In markets with thin margins, costs definitely affect retail pricing. Big tariffs will directly affect prices in those markets. And manufacturers just about never eat expenses. That cuts into profits. No way anyone is going to convince me companies don’t mind eating those kinds of costs.
I think those thinking big China tariffs won’t significantly affect prices are mistaken, but it only matters for those who think it’s going to get onerous and want to prepare somehow.
Those who think tariffs won’t affect them are certainly free to not take any steps to prepare. Fact is we’re all going to find out for sure soon enough.
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Yep. Definitely we agree on this one, entirely… as well as with the remaining arguments in this post.
Hear hear.
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Funny thing about this. Their upper end printers like the Mk4 are priced so high, with no better print quality than a bambu that getting around the tarrifs won’t make them cheaper than the Chinese ones, but it will bring the prices to a somewhat more competitive level.
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When we think of tariffs we think across the board. Fact is that it’s more complicated. In around 2018 when those 25% tariffs came my business was trying to manipulate those SIC codes. Parts for the unit and the assembled unit were classified differently, which meant that they were taxed different. They were exploring ways to ship to Mexico and assemble there. Some companies were negotiating with the US government to try to get there products reclassified.
You can just imagine the additional bureaucracy and corruption this will bring on.
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So, if a company like Prussa builds a factory in America,will they be exempt from tariffs?
Won’t we be paying more for those printers, because it costs more to make in America because of higher labor costs, real estate to build the factory etc? and won’t that cost the American consumer more to buy that product? Will that cost be more than the tariff?
What’s the tradeoff? Are tariffs the same as VAT taxes like Canada and some European countries have?
I’m not in the manufacturing business, I do know that in 1969 I bought a new Toyota Corona for roughly $1.00 a pound, (List price then was $1950) back then, all Toyotas came from Japan.and now similar Toyota models are built in America and costs much more… (Largest Toyota factory in the world is in Kentucky)
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If Bambu sticks with shipping the new printer in 1Q2025, there’s a reasonable chance it will dodge tariffs, at least at that time. That is, if the future parallels the past, because here’s a summary of the timing of the previous tariffs:
The tariffs implemented under President Trump were phased in gradually over several years, beginning in 2018. Here’s a general timeline of the main tariffs:
- January 2018: Tariffs on solar panels and washing machines were introduced, with rates set to decrease over a few years.
- March 2018: Steel (25%) and aluminum (10%) tariffs were imposed on various countries, with some countries temporarily exempted. These tariffs became more comprehensive over time as exemptions expired.
- July 2018 – September 2019: The most significant tariffs, part of the U.S.-China trade war, were introduced in stages, starting with tariffs on $34 billion worth of Chinese goods in July 2018. Additional rounds followed in August and September 2018 and were further expanded in 2019, eventually covering approximately $550 billion worth of Chinese imports by the end of 2019.
- December 2019 – January 2020: In January 2020, as part of the Phase One trade deal with China, some tariffs were reduced, but many remained in place.
The tariffs were not applied instantly but instead introduced in phases, allowing businesses and markets some time to adjust.
Looking back, I think it’s funny that washing machines were among the first two categories to be targetted by tariffs. Who would have thought? I only remembered the microchip tariffs. I didn’t recollect that it extended to low tech categories as well. I wonder whether washing machines will be first on the hit-list once again? 
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You seem to confuse economic terms and their functions, don’t seem to distinguish between costs (production vs distribution and pricing), customs fees and tariffs, and what are the quotas and when and how can these be used and against whom…
Perhaps this linked post might help clarify some of these things for you. If things aren’t getting much clearer after that, you might be in need of a highly concentrated and very specific 101 trade wars crash course… Anyway, hope this link helps.
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And just to show this isn’t necessarily about one party or the other, this is what happened afterward, at least in regards to the first two categories (no sense in getting too detailed):
As of November 2024, the tariffs on solar panels and washing machines, initially imposed during the Trump administration, have undergone significant changes:
Solar Panels:
- Initial Tariffs: In January 2018, President Trump approved tariffs on imported solar-energy components, starting at 30% and set to phase out after four years.
- Current Status: The Biden administration has not only maintained these tariffs but also increased them. In May 2024, tariffs on solar cells imported from China were doubled from 25% to 50%.
Washing Machines:
- Initial Tariffs: Alongside solar panels, tariffs on large residential washing machines were imposed in January 2018, starting at up to 50% and set to phase out after three years.
- Current Status: These tariffs were extended for an additional two years beyond their original expiration. However, as of March 2024, the tariffs on washing machines have expired.
In summary, while the tariffs on washing machines have expired, the tariffs on solar panels not only remain in effect but have been increased under the current administration.
I had been puzzled as to why the street price on solar panels hadn’t fallen in the US according to the steep decline generally reported, and, well, this explains why. Solar will be in the golden age if we ever get past this.
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