The tariffs announced by President Trump on Mexican goods may have an indirect impact on the car audio industry.
Few car audio products are actually made in Mexico, said industry members. About 80 percent of 12 volt supply comes from China, with most of the rest from Korea and Malaysia and a small fraction from Vietnam, said Paul Goldberg of Epsilon.
Pioneer owns a factory in Mexico, but it’s used largely for OEM products, Pioneer’s Ted Cardenas told us last year.
But the 5 percent tariff, due to start June 10, may impact consumers generally as they pay more for goods such as fruits and vegetables, cars and gasoline (8 percent of our oil comes from Mexico).
Consumers may be faced with the choice of spending more money on gas or buying a new car radio. Gas will most likely win out, said Goldberg.
Some economists, however, say the overall effect of a 5 or even a 10 percent tariff on the US economy will be minimal. The uncertainty it causes, however, can do more damage. The greatest disruption would be to the automakers, which own many factories in Mexico. General Motors’ Silverado and Sierra pickup trucks are made in Mexico as is the Chevy Blazer SUV. About 10 percent of Ford’s production is in Mexico, said the New York Times.
“New car prices could go up as much as much as $1,250 per vehicle, which will potentially slow sales of cars, which could indirectly impact aftermarket,” said Jim Warren, Executive Director of the Elite Distributor Alliance.
However, Mike Cofield, President of leading car audio specialty chain, Custom Sounds, TX said, “We don’t anticipate any sales effect.”
Last week Trump announced the 5 percent tariff, and said it may increase to 10 percent July 1. Tariffs will eventually increase to 25 percent “unless and until Mexico substantially stops the illegal inflow of aliens coming through its territory,” he stated.
The US imported almost $350 billion in goods from Mexico last year including such diverse items as cars, beer tomatoes, avocados and rugs.
Have you been watching the news? how may hundred’s lining up to cross over in mass only to receive food, shelter, health care, all far superior to what they can receive from where they came from all paid for by our tax dollars! Finely a way to slow the crossings that doesn’t cost us as much its time for Mexico to stop facilitating this exodus and work with the US to solve or at least slow down this process.
Well looking at it optimistically maybe people will choose to buy a new used car and then the possibility of upgrades is greater seeing that it’s harder to sell into newer cars these days. My feeling on tariffs after so many years of political lip service, somebody is finally taking a stand and saying NO MORE CHEATING! As far as my personal sacrifice goes I can only think of all our soldiers that put their lives on the line and make the greatest sacrifice of all to protect this great nation that has provided so much, for so many, for so long. So I’m willing to do my little part it the big picture. It’s time to be creative and create a more level playing field for all. One of the ways that I am going to be creative is to run my social media and advertising that we will pay the tariffs. Not every SKU that we order has a tariff on it. So we will make those SKUs our go to SKUs going forward and suck it up when we have to go to a SKU that has been hit by a tariff. Let’s hope for the best, do our best because we are the best.
Tariffs are taxes on Americans. And the impact is cumulative. The tariffs on Chinese goods will impact every American at varying levels. The tariffs on Mexico simply adds to the misery. It has been observed by many that no one wins in a trade war. But the people who are stuck with the higher prices all lose. Compounded by a “booming economy” that has largely benefited the upper 2% while throwing crumbs to everyone else. There will be a political price for this foolishness but not before a lot of Americans feel a lot of pain.
Yea. Wages of blue collar workers are rising faster than white collar workers. Nice try, but no cigar. Lowest unemployment in 50 years.
Yes, the uncertainty is a problem, but so are the tariffs themselves. More taxes on US citizens with quite muted salary gains means less money for most everything. We are clearly at the top of an economic cycle with recessions risks all around. Since this is cyclical, the question is how hard and deep the recession will be and these activities will not help.
It is true that fo China and elsewhere trade rules need to be revised no doubt. But here Mexico, Canada and others are not really the big concerns, and alienating all leaves us alone with limited leverage despite escalation and maximum pressure. There are alternate ways to do this, but it seems the “easy” route was taken. It will not prove so.
With more countries being named, can anyone say where production should be moved to? Keep in mind that many firms have tried to boost CE production in the US but the effect has been limited and most mass market products are not makeable here like it or not.
Tariffs are taxes. The world is a web well woven. Let’s hope this does not go on.
More winning 😱