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+-- Thread: Increased cost of imported machinery? (/showthread.php?tid=7324937)
Increased cost of imported machinery? - Monsieur Medlar - 11-11-2016
I dont mean to get into a big political discussion, pros and cons etc, but given the new Administration's emphasis on tightening up trade policy, I am wondering if costs will increase on equipment and machinery. While there are good options for many kinds of tools made domestically, I am pretty sure the vast majority of equipment or components comes from overseas, Europe or Asia. Good time to buy?
Again, I don't mean to discuss on this forum whether that's a good of bad thing, just the chances of significant increases in costs.
Toby
RE: Increased cost of imported machinery? - JGrout - 11-11-2016
in a global economy market I doubt it makes much difference
if you are cost conscious you should be haunting the used market anyway
RE: Increased cost of imported machinery? - PaulJohnstone - 11-11-2016
If the costs increase enough, they will start manufacturing things in America.
I remember when the imports first started coming.. Jet was only about 10% less than the Deltas (which at the time were American made)
Now they have probably found a way to make things even cheaper now, but the point is, there is a limit to how high things can get due to tariffs, because at some point it becomes more economical to make them in the US.. at least that is the theory.
RE: Increased cost of imported machinery? - EricU - 11-11-2016
you can't just start making things here, there are a lot of impediments to that. I'm not sure what will happen with trade, I expect most of that was just talk. The congress still has to pass the laws, and they are not exactly tariff-friendly. That could change, certainly.
RE: Increased cost of imported machinery? - Huxleywood - 11-11-2016
That question is hugely complex and the answer depends on a huge number of variables not the least of which is the strength of the dollar. Take for example the value of the yaun continues to drop against the dollar. While one would need a crystal ball to actually know my bet is the majority of "hobby" woodworking machines will still be made in China in 10 years and while the prices will almost certainly be higher they will still likely be the "bargain" choices just like they are today.
RE: Increased cost of imported machinery? - Robert Adams - 11-11-2016
Ignore the hysterical ramblings of the press after an election. One of the main reasons I don't watch news anymore and read all sides online.
But the prices of import machinery have gone up in price quite a bit the last 10 years already. Without my crystal ball handy I'd say don't worry about it. But now is always the best time to buy as tomorrow the price will go up as prices rarely go down.
RE: Increased cost of imported machinery? - Rick F - 11-11-2016
In the short term, I think the USD strengthened, which should lower the cost of imports. Not much ..
RE: Increased cost of imported machinery? - Huxleywood - 11-11-2016
(11-11-2016, 01:46 PM)Rick F Wrote: In the short term, I think the USD strengthened, which should lower the cost of imports. Not much ..
Why that would be the result from a simplistic POV this rarely happens. Large companies that rely on export for the bulk of their income almost always use the currency market to hedge changes in their native currency vs the currency of their major export markets so as to keep their prices stable. Car companies in particular use this approach. Now, their hedges are usualy designed to combat short to medium term currency fluctutions so they can not trade on this for the long haul.
One thing to keep in mind is the US "ship" takes a LONG time to change directions and barring events that truly upset the global economy you will not wake up one morning and find the price of Chinese goods have doubled. The reality is any significant restraint of trade with China would in effect be a huge regressive tax on the US consumer. I personally don't think the US people are willing to pay the "tax" long enough to return the manufacturing to the US, we are far too hooked on the drug of cheap consumer goods.
RE: Increased cost of imported machinery? - EricU - 11-11-2016
unless you are buying direct from a country where the dollar has gotten stronger than the local currency, I wouldn't expect to see any difference based on currency fluctuations. I doubt the dollar will strengthen as a result of the election. Right or wrong, the world is somewhat concerned about the new new U.S. government. If things go sour, I would expect even more pressure on the dollar, it has been inflated since 2008 because it was considered a safe haven. Currency valuation is often based on emotion, and you can't control that.
RE: Increased cost of imported machinery? - AHill - 11-11-2016
Time will tell, but if you look at the costs over the last 10 years of imported goods from China and Taiwan, they have risen quite dramatically. I purchased my Powermatic PM2000 table saw (Taiwan made, 3HP, 50 in fence) in 2008 for about $2200, delivered. Can't touch it for less than around $3300 now. That's a lot more than inflation.