General Motors Co. is seeking an exemption to a 25 percent US tariff on its Chinese-made Buick Envision sport utility vehicle in a move to prevent the key model in the brand’s US lineup from becoming a victim of the US-China trade war, Reuters reports, citing a statement from the automaker.
The midsize SUV, priced starting at about US$35,000, has become a target for critics of Chinese-made goods, including leaders of the United Auto Workers union and members in key political swing states such as Michigan and Ohio.
The Envision, assembled only in China, last year accounted for about 19 percent of Buick brand sales in the United States.
GM said in the statement it filed the request on July 30 with the US Trade Representative. An official notice was posted on Thursday on the regulations.gov website, which is tracking requests for exclusions from the so-called Section 301 tariff on certain imported goods from China.
GM, the largest US automaker, argued in its request that Envision sales in China and the United States would generate funds “to invest in our US manufacturing facilities and to develop the next generation of automotive technology in the United States”.
GM said the “vast majority” of Envisions, about 200,000 a year, are sold in China. About 41,000 were sold last year in the US.
Because of the lower US sales volume, “assembly in our home market is not an option” for the Envision, which competes with such mid-size crossover vehicles as the Jeep Grand Cherokee and the Cadillac XT5.
GM has taken other steps to soften the blow of tariffs, which hit just as the automaker had lowered the price of the Envision to make it more competitive.
Ahead of the July 6 start for higher import tariffs, GM shipped in a six-month supply of Envisions at the much lower 2.5 percent tariff rate.
Envision sales from April through June plunged to just 7,000 vehicles, while inventories climbed to more than 13,000 vehicles at the end of June. At the current sales rate, the Envision supply should be enough to keep many dealers stocked through the end of the year.
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