Let's say the U.S. imports a brand new Ferrari that costs $600,000. I know that it would take away from the U.S. GDP since it's considered an import. However, if a consumer buys that Ferrari from the U.S., would it also add to the GDP (consumption) and cancel out the imports? What would happen if it just sat in U.S. warehouses unsold? Is it still adding to the GDP (investment) to cancel out with imports?
In the expenditure measure of GDP $$Y = C + I + G + (X – M)$$
imports $M$ appear to reduce GDP. However, this only offsets the consumption $C$ met by imports; if instead the money had not been spent on a Ferrari but had instead just been saved (and possibly lent abroad so it has no other effect on GDP) then GDP would have the same.
There is a slight effect on GDP if a Ferrari dealership in the US was involved in the transaction: its margin (the final sale price minus the import cost) would count as value added in GDP and would appear in the expenditure measure since the consumption amount would exceed the import amount.