Not a political post at all, just curiosity. If the tariffs are implemented to all imported cars. Would that also affect our GLS? Aren’t they built in USA? Not sure how any of this would work to be honest. Thank you all.

 

Even if built in the USA, I think many of the parts come from Germany!

 

I looked into it....word is - no.

 

It’s challenging to predict, but the short answer for the GLS is no. However, the new situation with tariffs might lead to general increase/inflation in the market for new and used cars in general just like covid years. However, the upcoming economic downturn could have a similar or even greater impact (lower demand, etc), potentially pushing the market down and working against the tariffs-induced inflation situation…. Meaning there are two driving factors pushing towards different directions (tariffs-indced inflation vs economic downturn) and it will depend on which one will have a stronger impact I guess…

 

I appreciate your feedbacks.

 

Looks like Trump was correct...again....they may be off. The winning just does not stop....

 

The EU is working on concessions to gain partial removal of US Tariffs - Bloomberg Article
They have a lot of tariffs against the US. They are negotiating to get some tariffs against the US dropped.

So who knows what will stay and what will go.

 

The thing with parts is, what exactly do you put a tariff or tax on. The engine for example. How much does the engine cost Mercedes? $10,000? $100?
I would not be surprised if the factory can buy the engine for $1 from Germany but the bumper that's made in house costs $50,000

Only Mercedes knows this and they have teams of accountants whos job this is to just move numbers on sheets to figure out the best way to pay taxes and tariffs.

Its all internal costs and only they know what these costs are.
Facebook makes no money in the US, but billions per week in Ireland. Movie studios do the same thing. Original Star Wars has never made a profit.

Ferrari comes off the boat, so thats an easy one. Maybe. Again, what does a Ferrari actually cost Ferrari?

 

We won't know for a couple of weeks or more.
Moving target.

 

This may have been said already, but one potential impact on the GLS is if MB decides to spread the added tariff costs over all of its models rather than having just the directly affected models taking the entire hit.

 

The car companies will probably do that. Would be stupid if the GLE, which is made in US is cheaper than the GLC, which is not

 

That will be very interesting but MB unlikely will let that happen.

 

In the end, tariffs are a tax on consumption. And in this case, consumption for the "rich" . Its a tax on consumption and you don't have to pay it if you don't buy the imported stuff.
You definitely need to be pretty successful to afford a new Mercedes. Many people will live in a house built with US materials, eat food grown in the US and drive a car mostly made in the US.
If you don't buy the stuff, you don't pay the tariff.

If you think Mercedes has it bad, Ferrari has it even worse. They are already raising prices. Then again the customers that buy Ferrari, for them this just makes it more exclusive, and I think this might just add to Mercedes exclusivity in the US too.

 

not just talking about Ferrari, simply talking about Porsche, look at the prices using internet archive. Way higher now.

 

It will trickle down to everything automotive, regardless if directly impacted or indirectly. Those not impacted will try to maintain their price spread to those that are impacted. Same for parts. This will feed into the used market as well, as they’ll likely see increased demand for the used (especially the certified) to try and avoid the tariff.

don’t know how it’ll impact leasing though, since you're technically not buying the car. Would assume the same though, as the opportunity will be present for the dealership to do so now regardless of brand.

 

Leasing will be the same. Residual is based on MSRP and MSRP is based on overall cost of the car.

Is there any doubt everything car-related gets worse?!!!

 

Residuals may be higher, affecting the depreciation factor.

 

Used car prices and the car servicing at the dealerships would be going up too. Time to look for American cars, CTS-V 6 speed

 

That about sums up the only ICE US-assembled vehicle I'd get: CT5 V-Blackwing.

For EVs, I'd get a Lucid or Rivian.

 

The CTS-V only had 25% foreign parts. I think my AMG53 is 35% foreign.

 

I’m loving this American fun buggy that replaced my 2014 E350 last June. Getting very close to switching over to the soft top soon.

 

OK, @nc211 wha dat?

 

From an article in the Wall Street Journal:
“Roughly two-thirds of the 324,500 vehicles Mercedes shipped to dealers in the U.S. last year were imported, and even the popular GLE and GLS SUVs it assembled in Tuscaloosa, Ala., used engines and transmissions from Europe.

New U.S. tariffs could cost the company $1.7 billion this year, according to brokerage Bernstein—14% of expected operating profit. Parts account for roughly a third of the potential impact.

That is before any potential retaliation by U.S. trading partners. Mercedes exports most of the vehicles assembled in Tuscaloosa, exposing it to tit-for-tat tariffs.”



The article goes on to say that MB says that of the vehicles assembled in Tuscalussa, 35-40% of parts come from US or Canada, but the “official labeling” on the vehicles states 10%.

 

We're all at the mercy of political absurdity that impacts our personal finances. Several years ago I was hit with the Obamacare 3.8% capital gains surcharge (on top of the 20% regular CG tax) that by itself makes a 25% tariff on an automobile purchase look like pocket change.

 

nearly nothing in the US is 100% USA made. The food we grow is provided nutrients from primarily Ukraine and formerly Russia. Chemicals are from abroad and depending on what part of the horticultural chain you’re in, the media can be from abroad as well. So we’re talking about farmers that have $1 million nutrient and chemical bill now having a $1.25 million nutrient and chemical bill. More importantly, a UNIT tax is a tax on consumption, and a luxury tax is a “disproportionate tax on the rich”. A tariff is meant to be punitive, to importers, manufacturers that import, and foreign manufacturer selling abroad. The tax is not a line item that a consumer sees. So they consumption tax in this case is consumption by importers and manufacturers, not individuals.The result of the tax on anything is that the person that consumes the good pays it with higher retail prices. So it is consumption related but not only for the rich, this will affect every product, good , and service. One might ask why does service rate go up but it’s because that service man now has a higher cost of living of essential items.

Now couple all of this in with socioeconomics, remove the individuality, and in today’s world of misinformation, people panic, and don’t make rational decisions because someone is literally changing the price of their food and their family security overnight.

The economy can be like a bike wheel. You have a hub and spokes and a rim and if you remove the hub, the wheel doesn’t work. If you remove the rim, the wheel doesn’t work, but if you remove one spoke, it’ll work and be very wobbly remove too many spokes and the wheel doesn’t work. What we are seeing now is a removal of the hub, the spokes and the rim and we wonder why our bikes don’t work. . And there’s people on the sidelines of the race cheering.. for simplicity the hub is the government the spokes are the security of the people and the rim is society.