Date
12 December 2018
Newly manufactured cars at Dalian port in Liaoning province. China exported 53,300 vehicles to the US market last year and imported 280,208 US manufactured vehicles. Photo: Reuters
Newly manufactured cars at Dalian port in Liaoning province. China exported 53,300 vehicles to the US market last year and imported 280,208 US manufactured vehicles. Photo: Reuters

US threatens to raise tariffs on Chinese vehicles

US Trade Representative Robert Lighthizer said he is examining all available tools to raise US tariffs on Chinese vehicles to the 40 percent duties that China is now charging on US-produced vehicles, Reuters reports.

Lighthizer said on Wednesday in a statement criticizing China’s “egregious” tariffs on US autos that he is taking such action at the direction of President Donald Trump.

The statement came just days before Trump is due to meet Chinese President Xi Jinping in Buenos Aires in a showdown that could ease or worsen the trade war between the world’s two largest economies.

Automotive duties on both sides have been increased by tit-for-tat tariffs. The United States imposed a 25 percent tariff on Chinese vehicles on top of the 2.5 percent it normally charges.

China had lowered tariffs for all other countries to 15 percent, but imposed an additional 25 percent retaliatory tariff on US vehicles.

Chinese auto exports to the US are relatively small. It exported 53,300 vehicles to the US market last year and imported 280,208 US manufactured vehicles, according to data from the China Automotive Technology and Research Center, a government-affiliated think tank.

Carmakers are already rearranging global production to absorb the rising trade tensions between the two nations.

Volvo, which is owned by Chinese carmaker Geely, plans to move most of the production of its best-selling XC60 SUV for export to the US market away from its Chengdu plant in China to Torslanda in Sweden.

The Trump administration is seeking sweeping changes to China’s state-driven economic policies, including new protections for US intellectual property, an end to joint-venture requirements, more access for US firms to China’s vast market and cuts to China’s industrial subsidies.

“As the President has repeatedly noted, China’s aggressive, State-directed industrial policies are causing severe harm to US workers and manufacturers,” Lighthizer said. “We are continuing to raise these issues with China. As of yet, China has not come to the table with proposals for meaningful reform.”

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CG

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