TriggerFinger


Snark at the expense of accuracy


The Conservative TreehouseThis has to be one of the single funniest French retorts in the history of commerce. If President Trump follows through on auto tariffs, France will strike back. Let that sink in.

Oh noes,… your next Peugeot, Citroen or Renault purchase might cost more. D’oh.

I hate to say it, because usually this guy is pretty good (and if you read his full post, his point is made a little better), but the quote above is exactly wrong.

If the US places tariffs on imports of vehicles from the EU (targeting German cars -- BMW, Volkswagon, etc), that will raise the price of those cars in the US. It would also raise the price of Peugeot, Citroen, or Renault vehicles. (No one would care because in the US those brands are almost nonexistent).

However, if the EU -- including the French -- put tariffs in place, those tariffs would not raise the price of French cars in America. They would raise the price of American cars in France, ie, Chevrolet, Ford, and so on. Do our car manufacturers sell a lot of American cars to France? I don't know, but common sense tells me that if French cars suck, our cars might do well. And, of course, the French will have no tariffs in place against German cars.

That's the threat. It has nothing to do with raising the price of French cars in the US.

It might still make sense to raise our tariffs and try to negotiate them back down. I don't know what the trade balance and current tax structures are like. But our tariffs would be targeting the popular German cars, and theirs would be targeting our popular American brands.

This entry was published Tue Jun 26 12:18:44 CDT 2018 by TriggerFinger and last updated 2018-06-26 12:44:45.0. [Tweet]

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