Yes and sometimes worse. When a market cannot bear a price increase, the product simply ceases to exist. E.g. a low end $800 bike would never sell at $1,600.
Comment on We'll pass Trump tariffs back as higher prices for Americans: German firm
TomMasz@lemmy.world 1 week ago
That’s exactly how tariffs work. It’s always been how tariffs work. No company is going to lower profits if they don’t have to.
pc486@sh.itjust.works 1 week ago
dvoraqs@lemmy.world 1 week ago
I think you need a more extreme number if you say the words “would never sell” because that is only double the price.
With the other inflation we’ve seen, especially for the price of eggs, and upcoming tariffs those kinds of changes are not unheard of.
Supply and demand would still say that there would be less products designed and produced, but unless we are talking about specific branding, I would be surprised if supply or demand for any kind of product drops to zero.
pc486@sh.itjust.works 1 week ago
Why wouldn’t a price that’s too high to pay prevent a product from selling? If demand of a product goes from 10,000 units to 10 units from the price shift, then it’s better to not develop and sell it. The rational move is to focus on the high end or custom-made products where you can have the margins necessary for low-volume to make sense. When it comes to low-end products, volume and throughput is the name of the game.
Want an example? How about this smart move by Framework stopping selling some of its cheapest laptops.
Clent@lemmy.dbzer0.com 1 week ago
Some of them will end up with increased profits because Trump supporters are prepared to pay more. As we saw in the last inflation cycle, the incentive to exploit a crisis to increase margins is hard to ignore.