A 787 costs about 100 million but most of it's components are produced overseas. So when Boeing puts together a 787 book keepers can claim the USA manufactured 100 million in value. But all Boeing did was assemble 80 million worth of parts to create a 100 million airliner. That 100 million claim should really be a 20 million value added claim.
Is that the argument you are making? TIA
I don’t mean to answer for knarf, but here’s my reply: Yes. That is how accounting works all over the world, but it’s not quite the way your example suggests. First, few companies could exist if material costs comprised 80% of their selling price. I know you were just making up an example, but it’s actually more the other way-round, let’s say $30 million of materials goes into a $100 million aircraft. In addition, there’s labor - which is paid wherever the integration work is peformed, to everyone from assembly workers and those like QA and purchasing people who support manufacturing operations and the bosses. In addition, companies have to pay SG&A (administrative) and R&D (engineering) costs, and again these are US-based jobs. All these salaries go into local economies where they are used to pay mortgages, buy groceries, pay the Obamacare bills, etc - and where the multiplier effect is 3 to 10X.
Would Boeing sell more planes if it paid US wages for those components that are outsourced? Let’s transpose the question to “Would McDonalds sell more Happy Meals if it paid it’s workers $15 an hour like the protesters last week were demanding? It’s the same argument. More likely, Airbus would win more fleet purchases by offering a better aircraft for the money, and Boeing would lose market share instead. That’s how free markets work.
Consider also what makes a Boeing 787 have value to an airline? It’s because of who Boeing is - their superior reputation and track record for many years. Much of the “value” Boeing has is due to Boeing’s skill and track record at integrating components into the best, safest, most effective aircraft in the world. Boeing creates that value through everything it has ever done, and it’s entitled to be rewarded for it. Where parts come from isn’t any more of a factor to Boeing’s customers as where the cornfield was located that produced the sweetener for our favorite beverage. Companies are rewarded for managing cost in the context of all other factors to create value for their customers.
I'm 66 .. old school .. blue collar ... and I USED TO be able to walk into a factory of SOME sort in the Boston area, 1960's .. and talk to someone, fill out a form with basic information and start the next day or at the next pay period.
I can't do that any more because those kind of manufacturers are long gone.