U.S. Car Exporters Get Hit by China’s New Tariffs

The Chinese government recently announced the imposition of two new tariffs on U.S. car imports, bringing higher market access thresholds to U.S. auto manufacturers.

In the “Announcement on Imposing Anti-dumping and Countervailing Measures on Imports of Certain U.S.-made Cars (MoC Announcement [2011] No.84)” issued on December 14, the Ministry of Commerce (MoC) says that, between December 15, 2011 and December 14, 2013, both anti-dumping and countervailing tariffs will apply to U.S-made passenger cars and sports utility vehicles with engine capacities of 2.5 liters and above.

Duties imposed on U.S. auto manufacturers will depend on the amount of subsidies the respective auto manufacturers receive from the U.S. government and will vary between 2 percent and 21.5 percent.

Companies that base their manufacturing and exporting facilities in the United States will be hit hard by the new tariffs. Among the companies with their names specified on the list, only Ford is unscathed by the tax as the Ford Edge – the company’s only North American import into China – is manufactured in Canada.

While the new tariffs once again aroused accusation of China’s trade protectionism, the country argues they are “normal trade remedies” and stay “in line with World Trade Organization (WTO) rules”.

China also welcomes WTO ruling on the case and will respect the trade watchdog’s verdict, said the Chinese Commerce Minister Chen Deming.

At the WTO ministerial conference opened in Geneva on December 15 – the same day when the new China tariffs took effect – trade ministers from across the world warned that trade protectionism is a growing threat amid the global economic woes, and could cost billions of dollars.

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