Samsung Breathes a Sigh of Relief After Receiving Tariff Exemption
Since Samsung has so much production in Vietnam compared to Apple’s heavy reliance on China, they probably are in better position to navigate the growing trade war between the U.S. and China:
Samsung Electronics remains on alert amid the Donald Trump administration’s unpredictable trade policies, despite the United States granting tariff exemptions for smartphones, laptops, personal computers and semiconductor equipment.
The U.S. Customs and Border Protection said Saturday (local time) that those devices will be excluded from the sweeping 10 percent baseline tariff on nearly all countries, as well as the retaliatory 125 percent duty on China.
Following the updated guidance, Samsung has been considered one of the beneficiaries along with Apple and TSMC. Bloomberg described the measure as a “big win” for major tech firms.
The optimistic outlook stems from Samsung’s heavy reliance on production in Vietnam, which is on the verge of facing a 46 percent “reciprocal tariff” from the U.S. if trade talks between Hanoi and Washington fail following the current 90-day pause. The Korean company produces nearly 50 percent of all Galaxy smartphones sold globally at its Vietnamese facilities.
Korea Times
You can read more at the link.
It is hard to do business with all this tariff uncertainty and chaos.
If only there was some foolproof way to trick Trump and get around all his little tariff games.
I know!
Let’s build this stuff in America!
What’s he going to do then?
In fact, he has been cutting regulations and altering economic fundementals to make investment in these kinds of projects more attractive.
The fool won’t even see it coming.
That’s so crazy, IT JUST MIGHT WORK!
Why would anyone want to build anything in the United States? It’s not a stable, rule-based, Democratic, contract-abiding country with a strong rule of law. That’s Canada. That’s EU.
“Why would anyone want to build anything in the United States?”
I agree. Why is this even a big deal?
I keep wondering if Somalia raised their tariffs to 200% if it would get this kind of international pearl clutching.
My conclusion is there must be some kind of special value in access to the American market.
I then start to wonder if that access might be a valuable asset to be leveraged by an America First movement rather than squandered on nations who treat it as an entitlement while many of them seek immediate gain as they work against America’s long-term interests.
Now it is time to do things on America’s terms.
So…
“Why would anyone want to build anything in the United States?”
The best answer is…
Who cares?
Somebody is building something in the United States because factory construction is at an historical high… and not by a little.
Don’t like it? Maybe the Canadian market will satisfy you economic desires.
There’s no unique value in a market unless it’s large enough to justify the investment. If you’re required to manufacture everything entirely within the U.S., and the production costs far outweigh the potential benefits, then it’s simply not an attractive option.
To put it another way: if it costs $100 to make a product in the U.S. but you can only sell it for $10, it doesn’t make economic sense to relocate your operations to a country with unpredictable leadership, where the rules can change at any moment. That’s one reason why Russia has never been seen as a promising consumer market.
Now, if the U.S. production cost was only $1 and you could sell that product for $10, the equation changes. In that case, the potential returns might justify taking the risk, even in a politically unstable environment. That’s more in line with how companies view China, where the rewards often outweigh the risks. But in this analogy, you’re not China; you’re more like Russia.
“and the production costs far outweigh the potential benefits, then it’s simply not an attractive option.”
So much failure in the world is due to people insisting that history repeats when it actually rhymes.
We no longer live in the world you are speaking of.
There is no longer a race to the cheapest labor.
There is a race to the most automation.
American can very much compete in global manufacturing if the overhead of labor is reduced by robots, the overhead of management is reduced by AI, and the government reduces all the artificial regulatory barriers and excessive taxes that fund the self-destructive skims and grift.
American industry is doing their part. Trump is doing his.
You will notice the anti-Americans and those profiting from the corruption have nothing good to say about Musk with his rockets or robots and Trump with his desire to streamline bloated parasitic government.
Consider that.
If American can beat the foreigner and domestic sabotage, the 2030s will roar.
…as long as America sits back and supplies the participants of the global war without getting involved.
I agree, CH. My job involves automating, reducing toil, increasing reliability. You almost sounded like you were quoting my 3rd level manager’s speech at our last conference.
Gotta avoid the temptation to elect leftists, globalists, and other dinosaurs.