When David Rashid took over US autoparts maker Plews and Edelmann, the company was losing business to its Chinese rival, Qingdao Sunsong. Both companies make power steering hoses, but Sunsong was offering its hoses to retailers at a much lower price. Then, in 2018, the Trump administration threw companies like Rashid's a lifeline, by announcing tariffs on a range of Chinese goods, including some autoparts. Rashid thought the tariffs would finally force Sunsong to raise its prices, but, somehow, the company never did. It was a mystery. And it led Rashid to take on a new role – amateur trade fraud investigator. How could his competitor, Sunsong, absorb that 25% tax without changing its prices? And why had all of Sunsong's steering hoses stopped coming from China and started coming from Thailand? On today's episode, the wide gulf between how tariffs work in theory... and how they actually work in practice. And David Rashid's quest to figure out what, if anything, he could do about it. It's a quest that will involve international detectives, forensic chemists, and a friendship founded on a shared love for hummus. This episode was hosted by Keith Romer and Jeff Guo. It was produced by Emma Peaslee and edited by Molly Messick. It was fact-checked by Sierra Juarez and engineered by Ko Takasugi-Czernowin. Alex Goldmark is our executive producer. Help support Planet Money and hear our bonus episodes by subscribing to Planet Money+ in Apple Podcasts or at plus.npr.org/planetmoney. Learn more about sponsor message choices: podcastchoices.com/adchoices NPR Privacy Policy
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David Rashid had worked setting up and running auto parts factories for the better part of two decades when he got this job offer that would launch him on a very strange journey.
Some friends of mine called me up and asked me if I could help them out with a business that they had invested in that made power steering hoses.
These hoses, they're skinny.
They're made of rubber and steel, and they're vital to the power steering system in your car.
And that is about as technical as we're gonna get for now, that's about.
As technical as I think I can get.
Anyway, David's friends who offered him this new job, they worked for a private equity fund that had just made this big investment in a company called Clues and Edelman.
It had plants in both the US and Mexico.
So when you were brought on, what was the mission that they gave you?
What were you asked to do?
Fix it.
Fix what?
Fix.
Fix the trend.
The downward trend.