Tue, Dec 04, 2018 - Page 10 News List

China to cut tariffs on US cars: Trump

‘REDUCE AND REMOVE’:The Chinese Ministry of Foreign Affairs said economic teams in Beijing and Washington were instructed to work toward eliminating all import tariffs

Reuters, WASHINGTON and SHANGHAI

A security guard rides past a Tesla Inc charging station in Beijing on April 14 last year.

Photo: AP

US President Donald Trump on Sunday said that China had agreed to cut import tariffs on US-made cars, a potential boon for automakers, including Tesla Inc and BMW AG, that manufacture in the US for export to China.

Trump, fresh from agreeing a 90-day ceasefire in his trade war with China at the meeting of the G20, tweeted that “China has agreed to reduce and remove tariffs on cars coming into China from the US Currently the tariff is 40%.”

The move, if realized, would bolster US car manufacturers that were hit hard when China ramped up levies on US-made cars in July as part of a broad package of retaliatory tariffs amid a sprawling trade war between Washington and Beijing.

China, the world’s largest car market, raised tariffs on US auto imports to 40 percent in July, forcing many automakers to hike prices in a major hit to the about US$10 billion worth of passenger vehicles the US sent to China last year.

That put US-made car brands like Tesla and Ford Motor Co’s Lincoln at a major disadvantage, soon after China slashed auto import tariffs broadly to 15 percent for most vehicles.

Trump’s tweet did not give any further detail about the tariff cuts, such as when the deal had been reached or a new level for the Chinese levies.

The White House and US Trade Representative’s Office did not immediately respond to a request for comment late on Sunday. China’s commerce and finance ministries did not respond to requests for comment yesterday.

After a two-and-a-half hour dinner with Chinese President Xi Jinping (習近平) on Saturday in Buenos Aires, Trump agreed to postpone an increase in the tariff rate on US$200 billion worth of Chinese imports to 25 percent from 10 percent that was scheduled for Jan. 1.

China agreed to resume purchases of some US farm and energy commodities.

The two sides also agreed to negotiate during the next 90 days over “structural changes” to China’s policies on technology transfers, intellectual property protection, non-tariff barriers, cyberintrusions and cybertheft, services and agriculture.

Chinese Ministry of Foreign Affairs spokesman Geng Shuang (耿爽) yesterday said that the Chinese and US presidents instructed their economic teams to work toward removing all tariffs.

Major US automakers said they were unaware of the lower tariffs on exports to China.

The automakers had a previously scheduled meeting with the trade representative yesterday, two people briefed on the matter told reporters.

The lower tariffs would be a boost to automakers exporting vehicles to China, including Ford and German automaker BMW, which exports US-built luxury vehicles to China.

It would also be good news for Tesla, which has been hit hard by increased tariffs on the electric cars it imports to China.

The US firm has said it will cut prices to absorb more of the tariffs and is building a local plant in Shanghai.

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