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Wyze pays $255k of tariffs on $167k of floodlights

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Re: Wyze pays $255k of tariffs on $167k of floodlights

#81

Post by badestrand »

number6 wrote: post #40
voidUpdate wrote: post #37

Could someone explain to an idiot like me what the benefit of this is to the americans?

If they had bought American floodlights they had saved 255k in tarrifs. So if they had paid 200k for the floodlights they would have still been better of. One could argue, that there might be no American Floodlight Company - well here is the incentive to build one. Secondly the money isn't lost, it goes to the state. Like a tax, but it is called differently. With this 255k more the state can now subsidise the local f…

> Secondly the money isn't lost, it goes to the state. Like a tax, but it is called differently. With this 255k more the state can now subsidise the local floodlight industry.

Alternatively the taxes can be lowered so that overall the American consumers don't lose buying power (imports get more expensive but people also have more money to spend).

Re: Wyze pays $255k of tariffs on $167k of floodlights

#82

Post by danesparza »

prof-dr-ir wrote: post #31

Similarly HYTE, mostly known for their PC cases, gives a remarkably detailed insight, both into their cost structure and how they are impacted by tariffs, in this video: https://www.youtube.com/watch?v=1W_mSOS1Qts&t=1394s They also address the question of moving their production to the US.

This is a fantastically detailed video. Thank you for sharing this! Everybody on HN should watch this video to get an inside view of what businesses are going through in America right now.

Re: Wyze pays $255k of tariffs on $167k of floodlights

#83

Post by pyrale »

timewizard wrote: post #53
voidUpdate wrote: post #37

Could someone explain to an idiot like me what the benefit of this is to the americans?

It offsets the cost of cheaper Chinese labor and material costs. With the goal of making "made in the USA" products price competitive where they were not before. In the abstract this possibly makes more jobs in the USA for manufacturing these items. It also keeps the entire process conducted in US Dollars that stay entirely within our borders which is theoretically better for currency stability and value.

Of course it what you describe is a lasting situation, no one outside of the US would buy from an industry that is only propped up by subsidies, whose product is available for cheaper elsewhere, and likely subject to counter-tariffs. From there, the USD-labelled trade outside of the US would decrease, which makes it a less interesting proposition for foreign companies to hold USD, and, by extension, T-bonds.

US companies that actually made viable products for the international market would now have to compete with artificially subsidized companies on their costs, risk getting caught in tariffs, and, unless they build a critical product, probably see their international sales decline.

Re: Wyze pays $255k of tariffs on $167k of floodlights

#85

Post by lucianbr »

AnthonyMouse wrote: post #63
Aurornis wrote: post #3

Earlier quoted context omitted.

The top voted comments I see are all supportive so far. There are a lot of comments asking why they don’t move manufacturing to Seattle. This theme is common among people who don’t understand how manufacturing works right now: They don’t realize that a product like this has many different parts from different places, down to the dozens of little SMT capacitors. You can’t just move the factory and avoid tariffs becaus…

> This theme is common among people who don’t understand how manufacturing works right now: They don’t realize that a product like this has many different parts from different places, down to the dozens of little SMT capacitors. You can’t just move the factory and avoid tariffs because the parts still come from other places. This argument doesn't make a lot of sense. Suppose your company only does final assembly. The…

So moving one factory helps reduce the impact of tariffs on the final product from 145% to 135%, and to reduce it to zero you would have to move hundreds of factories, with tiny gains at each step.

I think the original argument makes a lot of sense, and yours does not. "Just move two hundred factories on a different continent" might as well be "just invent a time machine".

Re: Wyze pays $255k of tariffs on $167k of floodlights

#86

Post by JumpCrisscross »

almosthere wrote: post #17

I'm guessing a ton of new companies will pop up overnight in India, Taiwan, Vietnam, S Korea that simply purchase components from China and resell them to the US. Not exactly helping anyone.

> guessing a ton of new companies will pop up overnight in India, Taiwan, Vietnam, S Korea that simply purchase components from China and resell them to the US

The reality in high-tariff economies is simpler: more people just forge customs paperwork.

Re: Wyze pays $255k of tariffs on $167k of floodlights

#88

Post by netsharc »

Timshel wrote: post #50
hshdhdhj4444 wrote: post #35

Earlier quoted context omitted.

He’s already said they will reduce the tariffs on China. He insisted there will be some tariffs but 145% is too high and it will come down. A company moving their production anywhere based on what the policy is right now would be foolish because the policy could change in the next 5 mins, but will almost certainly change within minutes if there are empty shelves.

In a way it's worse since, you can't make plan to move if they become obsolete in 2 months but can you afford/survive waiting ...

Hah, so Trump II is comparable to the start of the Covid pandemic: "we'll just have to hunker down and wait".

Re: Wyze pays $255k of tariffs on $167k of floodlights

#89

Post by atwrk »

number6 wrote: post #40
voidUpdate wrote: post #37

Could someone explain to an idiot like me what the benefit of this is to the americans?

If they had bought American floodlights they had saved 255k in tarrifs. So if they had paid 200k for the floodlights they would have still been better of. One could argue, that there might be no American Floodlight Company - well here is the incentive to build one. Secondly the money isn't lost, it goes to the state. Like a tax, but it is called differently. With this 255k more the state can now subsidise the local f…

Thanks to the chicken tax we already know how this will develop: The US floodlight company will sell those US-made lights these lights for ~400k (so at the margin of market price plus tariffs), and no one outside the US will want to buy them. This is literally what already happened with the US car industry.
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