It seems a trade war is looming between China and the US where the former is said to be adopting a protectionist strategy. This decision could impact US-made imports in China which face exceptionally high import duties. Home to the world’s largest automotive market, to do business in China requires foreign automakers to create 50:50 joint ventures in the country to help circumvent high import duties. Meanwhile, the US is also planning to make imports from China expensive by slapping high import duties in what it feels is a befitting trade practice.
The arguments in favour of a modified tariff structures comes from the top. “We have helped to build China because they have taken out so much money in terms of trade deficits with this country,” President Donald Trump said in a business interview. “When China or another country charges us 50 per cent tariffs — more than that in some cases — and we charge them nothing, that’s not fair.”
Export-oriented China-based GAC Automobiles has been watching these developments as US lawmakers cry foul over China’s import tariff policies. In fact, GAC which is keen to promote its ‘Trumpchi’ brand of cars and SUVs in the US finds itself between the conflicting business policies.
After missing proposed 2015 and 2017 targets in the US market, GAC now hopes to start selling vehicles in the US by late next year with the help of a local partner. GAC is expected to partner with Fiat Chrysler Automobiles for US market entry.