▲ | Workaccount2 5 days ago | |||||||
Even 5% more expensive means 80% of people buy the taiwan version for $475 instead of $500. 20% more expensive and 99.9% of people buy the $500 one instead of the $600 one. Never make the mistake of falling for people's virtue signalling and pay attention instead to how they actually apply those virtues (spoiler: saving money is the #1 acted upon virtue, being far stronger than any other). | ||||||||
▲ | elcritch 5 days ago | parent | next [-] | |||||||
There's many fields where paying 10% extra on parts is more than worth it for shorter and more reliable supply chain. Not to mention probably better for the environment as well. The price for parts is often a small piece of the overall costs. Seems other agree with me on that: > And while many companies fear that moving their manufacturing to the U.S. would cost significantly more, some experts estimate that wafer production at the Arizona site is only about 10% more expensive compared to Taiwan. Despite that, the company says that its customers are willing to pay a higher price, with production already sold out until late 2027. Also interesting that many of the new tariffs settle down to around 10%. That seems like a good balance for the US, and also similar to what European tariffs have been for many industries. IMHO, the idea of entirely free trade is as dumb as excessive trade barriers. It's like trying to model people as purely rational agents. We're not. It's a decent starting point but we need perturbative models based on empirical information of human biases. The ideal solution for tariffs is likely a distribution function with a peak around 5-15% with a steep drop off toward 0% and a longer tail for higher tariffs. Because 0% just leaves you open to any market manipulations of malicious foreign actors and corporations looking to offshore for a few cents of profits while higher tariffs lead to increasing protectionism and local companies becoming lax and inefficient. That would just so happen to align well with these extra cost to manufacture in the USA in this instance. | ||||||||
▲ | CivBase 5 days ago | parent | prev | next [-] | |||||||
If the US can maintain even just 5-10% of production volume, that's a huge win IMO. It means the US has a foundation of knowledge, equipment, and supply chains to expand on in the event of an emergency. Taiwan is in a precarious position, which is a huge liability for "western" powers. And a liability for us is effectively also a liability for Taiwan, considering we are their protectorate. North America and western Europe are comparatively safe. | ||||||||
▲ | ethagknight 5 days ago | parent | prev | next [-] | |||||||
This is the manufacturing cost, not the retail MSRP. _Never_ make the mistake of assuming a market is perfectly efficient and any corporate savings along the way will be passed along to the consumer. When Apple or Google comes along and buys out next year's total TMSC output, that 80% of people will just have to buy whatever is on the shelf at the time. | ||||||||
▲ | FuriouslyAdrift 5 days ago | parent | prev | next [-] | |||||||
That what tariffs are for. Increases the cost of the foreign good to parity with the domestic good (hopefully) | ||||||||
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▲ | kelnos 4 days ago | parent | prev | next [-] | |||||||
The manufacturing cost is 5%-20% more expensive. That doesn't say much about what AMD is going to do with the prices they charge customers. They may be able to absorb that cost, albeit with lower margins, and may choose to do so for exactly the reason you state: people won't buy it if they can get a more or less identical product elsewhere for cheaper. Whether or not AMD is motivated to eat that cost is another question, of course. | ||||||||
▲ | rkangel 5 days ago | parent | prev | next [-] | |||||||
If other people agree with Lia Siu about supply chain resiliency, presumably what will happen is that they buy from both. Maybe they buy more from Taiwan, but the effective price will be somewhere between the two. | ||||||||
▲ | 4 days ago | parent | prev | next [-] | |||||||
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▲ | DSingularity 5 days ago | parent | prev [-] | |||||||
Virtue signaling? What are you talking about. You seem to have an axe to grind. Cost increase in a single part doesn’t necessarily mean the cost of the device needs to go up. If a CPU costs 120$ instead of 100$ like that of a competing device 300$ device you can always sell yours for 310$ and make less margins. Things have to get subsidized in the short term if we are going to get domestic production up. |