Following news from President Trump last week that China planned to cut tariffs on automobiles built in the United States and exported to China, the Asian country confirmed the discussions and plans to lower the auto tariff.
Bloomberg reported on the Chinese acknowledgment on Wednesday and said the country would lower the rate from 40 percent to 15 percent. Previously, U.S. autos were slapped with a 25 percent tariff upon entry, but a tentative agreement earlier this year planned to reduce the rate to 15 percent.

Photo: Gage Skidmore
Within weeks, the agreement fell apart as the trade war escalated; China instead bumped the rate to 40 percent, while it lowered the rate to 15 percent for other countries. If China makes good on its promise to lower the rate to 15 percent, it will be a 10 percent reduction from the normal rate—a good thing for any automaker that builds cars in the U.S. and ships them to China.
President Trump tweeted that both countries have had “very productive conversation” as the Bloomberg report broke.
The news also comes as both countries agreed to a 90-day ceasefire for the trade war for no new tariffs, though experts don’t believe either side will come to a new agreement by next March when the interim agreement expires. U.S. trade officials said they wanted to see the 40 percent retaliatory tariff removed as a sign of good faith.
It’s unclear if the U.S. plans to remove its own retaliatory tariff on cars built in China and exported to the U.S., however. The Trump administration moved to enact a 25 percent auto tariff on imported Chinese cars earlier this year. That tariff, if enacted, would slam GM and its China-built Buick Envision. The automaker filed for an exemption for the crossover SUV this year and GM said it could drop the model from Buick’s lineup without a tariff pass.
The proposal to reduce tariffs on U.S.-built cars is subject to change but the Chinese cabinet will review the proposal in the coming days.
Comments
That’s good news. In the future, GM can import Buicks and Cadillacs from China and Chevrolets from Mexico. That leaves GMC to be made in the USA.
The hope is free trade, so as the Chinese economy continues to grow then that 1.3billion population will produce at least some buyers of cameros and SUV’s. Believe it or not, while working in Europe for a couple of years, I saw an ever growing interest in the form ranger from middle class men. It goes to show we are all alike, the crossover, truck, SUV trend will continue on into western Europe, the south America and finally Asia is more rural reagions. American autos are poised to that kind of consumer market perfectly, assuming equal tarrifs.
gasoline in europe is about $1.6/liter. that comes to about $6/gallon. can europeans handle that cost?
if that happened here, i’m pretty sure truck sales would plummet.
It did happen here in the 2000’s. Europeans still drive regardless of how gas cost. They drive less in general. If you talk to a European about commuting an hour to work or taking a 4 hour road trip, they say that is crazy. Also most European countries are smaller than the state of Texas. One thing that eases the price burden is diesel is cheaper, around 5$ a gallon over there, and their emissions arnt as regulated, so a ranger over there with a 2.3 diesle will get almost 40mpg-50mpg. That 50mpg is because many of their smaller country roads are open, flat and have a speed limit of 45. Less wind resistance.
‘Acknowledges’ and ‘commits’ are two different things.
It is not just as simple as % tariffs; in China autoworkers are paid slave wages, China factories have not upgraded safety training and equipment, China factories pollute more than US factories (although they are improving), most countries have some type of value added tax they add on, most countries can drag their feet at ports of entry slowing down imports, etc., etc.;….