Fun conversation with one of my clients:

One of my clients is just planning to move more production to Mexico. He's the lead for their tax group. They sell ATVs.

They opened a plant there years ago because places like Brazil have tariffs on the US and not Mexico. So they can sell to Brazil etc. from Mexico without worrying about tariffs.

He said "Trump puts tariffs on China and Mexico. China and Mexico puts tariffs on the US. We just produce more in Mexico for China and Mexico. Problem solved."

Their plan is simple. Lay off 15%-25% of the workers here, move the jobs to Mexico, and keep selling. Parts in Mexico won't be subject to tariffs. Exports won't suffer higher prices from tariffs. And US consumers will buy less because the price will go up here. So they'll need less workers here anyway.

Will they move in the jobs back if the tariffs end? "Why would we?," he said, "We'll have the factories fully working there, experienced workers, and logistics set up. It would cost more to move it back and there would be no upside."