37.5% duty charged on Ascilab speakers shipped to US [Resolved]

[Timcognito]

I have zero reason to assume @Buckeye Amps wasn't truthful about their experience with import taxes - never remotely implied that. I just said that -like Italian bicycle import poster- my experience with shipping companies was different.

I know the company I work for stockpiled a *lot* of components manufactured in countries like South Korea, Taiwan, China etc when the tariff threats (among countries) started to escalate, in order to avoid having to hike prices (which in the end happened, too, but not my much, I think it was a 5% average across the board).

Okay I got that. But it is difficult to bite ones tung when on internet. I like both posters so it's hard to read when both keep reiterating the same thing over and over. I have done it with others more than a few times. Dad is of German decent and Mom Italian so I understand the anger and the passion.

 

[amirm]

Is it possible we are not facing a cataclysmic long term scenario and there is another desired outcome for which the current strategy supports? A more balanced level of trade.

We have more than balanced trade if you include services. We dominate the world in that area. Pretty sure we don't want to have that balanced.

As to rest of your post, this is what worries me. Likely you know that Toyota is synonymous with hybrid transmission for cars. Not only have they shipped millions and millions of them, they have licensed it to many other companies. You know where that came from? It was a US action to make us dominant in fuel efficiency while leaving other countries behind. The reality was the opposite: https://www.motortrend.com/features/hybrid-history

"1993: The Clinton-Gore administration created a Partnership for a New Generation of Vehicles (PNGV) between the United States Council for Automotive Research (formed in 1992), and a network of universities, national labs, federal agencies, and suppliers. The goals were 80-mpg concept vehicles by 1999 followed by production-feasible prototypes by 2004. No prototypes emerged, though GM's Precept did achieve 90 mpg on diesel fuel.

Toyota's exclusion from PNGV moved chairman Eiji Toyoda to ponder more efficient automobiles. Takeshi Uchi yamada was assigned the chief engineer's job for a project called G21 (global car for the 21st century).

1994: The original goal of a 50-percent efficiency gain was doubled by Toyota's new engineering executive vice president Akihiro Wada who targeted the following year's Tokyo Motor Show as the ideal opportunity for displaying a hybrid concept.

1995: While the Toyota Prius concept was under construction, eighty research engineers brainstormed on a practical hybrid powertrain. The final Toyota Hybrid System (THS) selected in June combined one IC engine, two electric motor-generators, and a planetary gear set in a configuration identical to TRW's 1970 electromechanical transmission. The first THS prototype ran in December.

1996: The Prius's market introduction was accelerated two years so Japanese customers would be on the road before the Kyoto Conference on Global Warming held in December 1997."

The rest as they say, is history. We have a government right now which is running this thing as an emotional affair with yes men in the meetings. I doubt there is a single ounce of due diligence is being applied to what we are doing and what actions we cannot undo.

If you want to conduct such social experiments, you do it slow. This is what you do in corporate life. You don't surround yourself with yes-men and make decisions based on emotion, who saluted you yesterday, and who not. US auto-makers currently pay 25% tariff for cars manufactured in Canada/Mexico while Japan and Korea "enjoy" 15% tariff. Every 2 months I am getting a new price list from Harman with higher prices. We have tariffs on stuff we import that we cannot produce in US so all we are doing is making these goods more expensive. None of this makes any sense.

What do we want out of this balancing anyway? Why do we want our people to stop doing what they are and go work in factories? Our president's idea around Tariff come from 30+ years ago when he woke up one day and decided this was a good idea. The world is different. Microsoft, Google, Netflix, Facebook, X, etc. are extracting billions and billions of dollars from overseas customers per my intro. Should we allow them to make this fair by passing taxes?

 

[MarkS]

As the OP, I want to emphasize that my complaint is not that I was charged a tariff after delivery (I fully expected that), but that the tariff rate of 37.5% was based on the product being from China, when I had every expectation that it would be from South Korea (with a tariff rate of 15%, which I had checked before purchase). As the end customer, I had no way to ascertain in advance that this product would be viewed as originating in China.

 

[TankTop]

Here's an expanded list of US speaker manufacturers. There are likely more.

Volti Audio - TN
Klipschorn - AK
Magnepan - MN
GR Research - TX
PBN Audio/Liberty Audio - TX
Spatial Audio Lab - UT
Vandersteen Audio - CA
Wilson Audio - CA
Fritz Speakers - CA
Odyssey Audio - IN
Tyler Acoustics - KY
Legacy Audio - IL
Magico Speakers - CA
Ascend Acoustics -CA
JTR Audio - WI
Daedalus Audio - WA
Aerial Acoustics - MA
Rockport Technologies - ME
Avalon Acoustics - CO
Eggleston Works - TN
Danley Sound Labs - GA

I think those manufacturers are going to get a lot more business in the next couple years.

The United States almost completely abandoned manufacturing consumer electronics domestically a couple decades ago. Not going to debate whether or not tariffs were the correct approach, but we have not been approaching the issue at all, no matter who was in the White House. The United States desperately needs to bring back a large consumer electronics manufacturing capability.

 

[pablolie]

Okay I got that. But it is difficult to bite ones tung when on internet. I like both posters so it's hard to read when both keep reiterating the same thing over and over. I have done it with others more than a few times. Dad is of German decent and Mom Italian so I understand the anger and the passion.

At no point was I angry at anyone - zero animosity. Probably my fault for joining a topic that was heated already and that made some misunderstand the rather fine nuance of my argument, which was not about pro or con of tariffs, just about the fact sales contracts are legally binding in the US (no additional hidden fees after the contract is signed), but that doesn't mean there isn't a grey area when a company decides to ship to US companies or consumers without having representation in the US. As to import taxes, there's no way around paying them or try to dispute them, period,

 

[Somafunk]

That is a straw man. We're talking about a simple set of box speakers here.
Good golly.

Miss Molly?……….

Sorry…couldn’t resist the joke even it is rather childish

 

[Cbdb2]

Why all the name calling and angst over a policy that you disagree with? I don't like tariffs or any taxes for that matter but the reality is governments need to raise money one way or another and at the end of the day taxes are all the same

These tariffs are more about bribing/blackmailing other countries and increasing the personal wealth of a few, than raising taxes. The Brazilians talk about taking a buddy of the orange clowns to court and the next day he slaps a 50% tariff on Brazil. The Canadian government says they support an independant Palestine and the next day the clown slaps a big tariff on Canada, with him lying about fentanal . Theres more examples. How long do you think the rest of the world will put up with this bullying?

 

[pablolie]

As the OP, I want to emphasize that my complaint is not that I was charged a tariff after delivery (I fully expected that), but that the tariff rate of 37.5% was based on the product being from China, when I had every expectation that it would be from South Korea (with a tariff rate of 15%, which I had checked before purchase). As the end customer, I had no way to ascertain in advance that this product would be viewed as originating in China.

That sucks, sorry. And in my non-expert opinion on such things is a bad business practice by Ascilabs. They should have waited until they have a representative in the US. Just my opinion. Luckily that is clearly underway.

 

[a4eaudio]

So the bottom 50% going from 3% in 2008 to 1% in 2010 is nothing?

Correct. The one interesting thing I see is that the trend of the Top 1% continued to slowly increase over this period, continuing the trend from the late 1970s/early 1980s. There is no indication that anything statistically significant happened across any of the lines in the graph from 1990 to 2020 and most important to your point, no apparent discontinuity at 2008. So while "things" may be changing over this period, it does not appear to be anything specific to 2008 the trend line from 1990 to 2011 is pretty uniform. To the extent that the bottom 50% practically has no wealth (3%) and they would need to liquidate some of that during the Great Recession (Dec 2007 to June 2009) the decrease in wealth to 1% is likely just a normal consequence of a recession.

 

[PristineSound]

Yes, I started it by saying I thought you were being pedantic. Apparently I hit a nerve.

Let’s break it down:

You said Americans are stupid and can’t possible understand the basic global supply chain and that most inputs are made overseas.

I said the ones making the broad comment of buying American made to avoid tariffs are stupid. And yes, they are. And there are many of them. I also said never underestimate how stupid some Americans are and I say this as an American.

1. I responded saying most of the “enlightened” think they understand economic theory, but most really don’t.

Some have a better grasp than others, while others think Made in America will solve all tarriffs related costs. So if you want to call the ones with a better grasp "enlightened," you can. I also said supply chain is common knowledge, you seem to agree.

2. You asked me to prove it asking what do the “enlightened have wrong”

Yes, still waiting.

3. In response, I asked you to provide an explanation on the causes of inflation followed by possible corrective measures to contain/lower inflation and the associated impacts of those corrective measures - no chatGPT allowed.

I’m still waiting on that explanation..

But why am I being quizzed? Why are you not telling the "enlightened" ASR members what is it they have wrong? Or are you trying to somehow lead in to saying tariffs have no inflationary effect with your question?

I feel content my point has objectively been sufficiently demonstrated. Not sure where else to go honestly.

What is your point? So far, it seems like no point.

Thanks for making it so easy I guess - lol.

Well, I can say this. When I was studying electrical engineering in college, all the kids who couldn't cut mustard, dropped out and went into economics. So yeah, I guess economics is easy, peasy and breezy.

Anyway, my final post with you here. Typically I would end it saying, "it was entertaining." But this dialogue not only wasn't even entertaining, it reaffirmed George Carlin's quote.

 

[a4eaudio]

...The reality was the opposite: https://www.motortrend.com/features/hybrid-history

Oh...facts! Thank you for the interesting post.

 

[MarkS]

Since this thread has morphed into a general discussion of trariffs, I find this article by economist Noah Smith to be a useful contribution to the debate:

All the arguments for Trump's tariffs are wrong and bad

The President's defenders are flailing.

www.noahpinion.blog

 

[pablolie]

Since this thread has morphed into a general discussion of trariffs, I find this article by economist Noah Smith to be a useful contribution to the debate:

All the arguments for Trump's tariffs are wrong and bad

The President's defenders are flailing.

www.noahpinion.blog

I don't have strong pro-con positions other than:

1. I would greatly welcome the US investing in bringing back high-quality manufacturing to the USA.

2. The constant flip-flopping between extreme tariffs and sudden deals doesn't support the effectiveness, transparency, credibility and mid-term benefits of tariffs. It just makes things look like a desperate furniture dealership that always announces "final close-down sales" all the time.

Hopefully things mature beyond the here and now.

 

[Gary_G]

Made in the USA Bourbon got me through these 12 pages of posts. Very interesting debates and information, heated a little, but that's expected on such a topic.

The depth of knowledge is astounding!

 

[MattHooper]

I’m not good with this stuff so perhaps you could clarify for me…

If you purchase from another country that is subject to tariffs (which is virtually every country now), you will be billed the tariff fee.

When you reference the tariff fee, do you mean the tariff amount set by the US government?
Or the proportion of the tariffs the company in question decides to add to the price of the goods?

Doesn’t that depend on whether the manufacture in question decides to eat the tariff or not? Or how much they decide to pass on the customer?

 

[CtheArgie]

Again inflation is a measure of overall price level not a subset of prices affected by a policy change or other external shock. When the price of one thing is changed quickly (imported good due to policy change) there will be adjustments and substitutions and some prices will be higher and some lower and some winners and some losers but overall it is not inflationary by its self. Of course reactions by the government / monetary authorities could cause tariffs to be either inflationary or deflationary.

Predicting the future is not possible so argueing which indicator is better from a list of poor predictors is kind of a waste of time but the stock market is as good as any.

Again, your economic studies were not very successful.

Paul Samuelson, who you may have heard of, used to say that the stock market predicted nine of the last five recessions.

Maybe you should subscribe to PaulKrugman’s Substack, he goes in depth with references and self deprecation into current economics and history.

In Argentina, we had to study Raul Prebisch and his import substitution policies. They resulted in poor quality products at high prices. I’ve seen that picture, it ends poorly.

 

[Groove01]

We have more than balanced trade if you include services. We dominate the world in that area. Pretty sure we don't want to have that balanced.

As to rest of your post, this is what worries me. Likely you know that Toyota is synonymous with hybrid transmission for cars. Not only have they shipped millions and millions of them, they have licensed it to many other companies. You know where that came from? It was a US action to make us dominant in fuel efficiency while leaving other countries behind. The reality was the opposite: https://www.motortrend.com/features/hybrid-history

"1993: The Clinton-Gore administration created a Partnership for a New Generation of Vehicles (PNGV) between the United States Council for Automotive Research (formed in 1992), and a network of universities, national labs, federal agencies, and suppliers. The goals were 80-mpg concept vehicles by 1999 followed by production-feasible prototypes by 2004. No prototypes emerged, though GM's Precept did achieve 90 mpg on diesel fuel.

Toyota's exclusion from PNGV moved chairman Eiji Toyoda to ponder more efficient automobiles. Takeshi Uchi yamada was assigned the chief engineer's job for a project called G21 (global car for the 21st century).

1994: The original goal of a 50-percent efficiency gain was doubled by Toyota's new engineering executive vice president Akihiro Wada who targeted the following year's Tokyo Motor Show as the ideal opportunity for displaying a hybrid concept.

1995: While the Toyota Prius concept was under construction, eighty research engineers brainstormed on a practical hybrid powertrain. The final Toyota Hybrid System (THS) selected in June combined one IC engine, two electric motor-generators, and a planetary gear set in a configuration identical to TRW's 1970 electromechanical transmission. The first THS prototype ran in December.

1996: The Prius's market introduction was accelerated two years so Japanese customers would be on the road before the Kyoto Conference on Global Warming held in December 1997."

The rest as they say, is history. We have a government right now which is running this thing as an emotional affair with yes men in the meetings. I doubt there is a single ounce of due diligence is being applied to what we are doing and what actions we cannot undo.

If you want to conduct such social experiments, you do it slow. This is what you do in corporate life. You don't surround yourself with yes-men and make decisions based on emotion, who saluted you yesterday, and who not. US auto-makers currently pay 25% tariff for cars manufactured in Canada/Mexico while Japan and Korea "enjoy" 15% tariff. Every 2 months I am getting a new price list from Harman with higher prices. We have tariffs on stuff we import that we cannot produce in US so all we are doing is making these goods more expensive. None of this makes any sense.

What do we want out of this balancing anyway? Why do we want our people to stop doing what they are and go work in factories? Our president's idea around Tariff come from 30+ years ago when he woke up one day and decided this was a good idea. The world is different. Microsoft, Google, Netflix, Facebook, X, etc. are extracting billions and billions of dollars from overseas customers per my intro. Should we allow them to make this fair by passing taxes?

I agree we dominate in export of services, that’s a fact. However we are still negative with regard to overall balance. How much does that even matter - it depends.

There is a growing problem with the sustainability of the middle classes as we continue to shift to a highly skilled service based economy. We need to figure that out.

Historically that gap was met by manufacturing jobs and the associated supporting eco system. Can we get there again..not in 3 years, lol. But over time..maybe?

There’s a concept of “net back” that was prevalent in the early days of call center outsourcing. It went something like this: If outsourcing customer support to India is 40% cheaper (gross), if we net out lower productivity, lower customer satisfaction, and increased customers attrition, the actual “net back” is say 25%.

Over time as the industry matures and competition increases, agents will walk down the street for $.50 more/hr. Over time this repeats until the competitive wage increases to where the overall “net back” goes down to ~15% at which point the company asks if it’s still worth offshoring. At some point, on-shoring becomes a competitive advantage in a saturated mkt such as credit cards. This is exactly what happened over the course of maybe 15-20 years starting in the early 90’s.

Where are we on the manufacturing net back continuum? When do we start rebuilding to catch it on the downside? Manufacturing has a much longer lead time and capital investment runway than call center for sure. The bigger question - can we ever be a competitive manufacturer again..?

I don’t have those answers, but do think as a country we need to be thinking about these things and what the next 30 yrs may look like. China and India ate our lunch in that regard over the last ~20 yrs on education, manufacturing. etc.

They play a long game, we don’t. When and how do we start?

I don’t agree with much of the current approach, etc. But I do like we are finally at least thinking about it..

Edit: I’m making an assumption an underlying tenant of his strategy is foreign investment in domestic manufacturing.

 

[PristineSound]

1. I would greatly welcome the US investing in bringing back high-quality manufacturing to the USA.

Well darn, if we're gonna drift and if even the OP is going to drift. Heck, let me jump on the bandwagon without getting into the politics.

Most developed countries, in fact, all developed countries that still have manufacturing are manufacturing goods high in the value chain with some exceptions for good reasons. They are typically more profitable and required more skilled workers. Bringing manufacturing back to the US is not a bad thing, but it depends what you are bringing back. Obviously advance semiconductors is a no brainier. Maybe smartphones can be ok, if there's sufficient automation.

And if that is the direction, the US economy needs to build up the supply chain, something that took China decades to build. Overnight tariff won't magically build this supply chain. You also need to start the pipeline of training your workers for these jobs. Decades of manufacturing drought depleted the workforce for these types of jobs.

The one big elephant in the room that no administration talks about, because it's political suicide, is the inherent increase on the cost of the goods as a result of increase labor cost. So you need to automate the living sh|t out of US manufacturering. Sorry, if the same exact product with the same exact support costs more to manufactured in the US, I ain't buying it. And trust me, a lot of Americans ain't gonna buy it neither, they just won't say it in public, but I will and I will be there mouthpiece.

37.5% tariff ain't going to do any of that. All of this takes time with a deliberate and united America.

 

[mj30250]

I’m not good with this stuff so perhaps you could clarify for me…



When you reference the tariff fee, do you mean the tariff amount set by the US government?
Or the proportion of the tariffs the company in question decides to add to the price of the goods?

Doesn’t that depend on whether the manufacture in question decides to eat the tariff or not? Or how much they decide to pass on the customer?

If the manufacturer / vendor is the importer, they are responsible for paying the tariff. It's then up to them how much of the tariff charges get built into the cost of the product, or if they choose, they can break them out onto a separate line item when the customer is billed (well, unless they're Amazon I guess).

If the customer is considered the importer, as is the case for the OP, they will get billed for the tariff directly.

 

[LTig]

I think those manufacturers are going to get a lot more business in the next couple years.

The United States almost completely abandoned manufacturing consumer electronics domestically a couple decades ago. Not going to debate whether or not tariffs were the correct approach, but we have not been approaching the issue at all, no matter who was in the White House. The United States desperately needs to bring back a large consumer electronics manufacturing capability.

I fear this is wishful thinking. It won't happen, neither in the US nor in the EU.

Knowledge about precise manufacturing has been lost to China, and not only in electronics. There is a guy in Germany who designs (and sells) tripod heads for very heavy camera lenses. Some 10 years ago he complained that it gets more and more difficult to find a workshop which can produce the parts to his specs.