Rising tariffs could increase production costs and disrupt supply chains for Dell's Mexico-based facilities.
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Tariff’s can throw a wrench into everything - supply chains, pricing, competitiveness, and long-term planning. Businesses that rely on imported components are seeing costs rise, while those exporting goods face retaliation. Even companies that don’t deal directly with imports or exports are feeling the ripple effects through inflation and shifting market dynamics. Get ready for the sh-t show.
No silly we’ll just use the American factories that source 100% of our supply chain domestically.
Surely we have an ample supply of all the goods Dell imports and our customers will not suffer from large price increases.
Wait …, where are our factories?
When it comes to offshoring manufacturing, the entire playbook of Dell is do what the others are doing.
Remember when Dell used to manufacture its own stuff? Maybe it will again. As for labor costs, as part of a "game" I and others were given a desk-top kit and told to put ot together. First time out it took me about 30 minutes. I have no doubt that after several repetitions I could get it down to 10 minutes. At $20-$25 an hour how much did we really save by going out of country? I always suspected Dell did it because MD read that others were doing it and for no other reason. For those of you who ask if any financial analysis was done for that decision, Finance can always get the answer MD wants.
More expensive to make things in the US as the labour is more $$$. That’s why things got off-shored in the first place. Result of repatriation and tariffs will be higher costs and inflation for US consumers which will slow the economy. Basic economics!
Purchasing anything from Dell about to more expensive.
There won't be much captive manufacturing. Places like Foxconn will expand existing domestic operations and/or develop them further.
Apple has committed $500 billion to US manufacturing in Houston, but nothing from Dell Technologies.
Good! Jobs come back to U.S., next question?