Tariffs · 54 min
What a Tariff Actually Does to a Supply Chain
Tracing one component from order to landed cost to find out who really pays.
Odd Lots ·
Overview
Rather than argue about incidence in the abstract, this episode follows a single industrial component through quoting, shipping, customs and final assembly, and puts a number on each step. The result is messier than either side of the debate assumes: the split shifts with contract length, substitution options and who holds inventory risk. The guest is good on the difference between the first year and the third.
Key takeaways
Incidence in year one is mostly the importer; by year three it has migrated into price and sourcing decisions.
Contract length determines who eats the cost far more than bargaining-power arguments do.
Substitution happens at the component level long before it happens at the supplier level.
Inventory positioning ahead of an announced tariff distorts trade data for two to three quarters.
Companies & tickers
- CAT
- DE
Topics
Publisher’s description
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