President Trump tweeted Monday morning that China has agreed to cut taxes and tariffs on U.S. automobiles exported to the country. The tariff reduction is a huge boon to automakers that build cars in the U.S. and export them to China.
Automakers most affected by the tariffs currently include Ford, Tesla, Mercedes-Benz and BMW. General Motors does not export cars from the U.S. to China, but instead operates a robust manufacturing footprint locally. GM has, so far, been more concerned about U.S. tariffs on cars that come from China. The automaker only builds one model in China for export to the U.S., the Buick Envision, but filed a request earlier this year to exclude the car. It’s unclear if GM was ever granted that request.
GM also said it could drop the Envision model from the U.S. lineup if tariffs took hold.
But, for now, it’s good news for GM all around. President Trump and Chinese President Xi agreed to a 90-day ceasefire on a crippling trade war for both countries. GM, and other companies have cried foul over rising raw material prices and warned the administration the current trade policy may result in negative impacts. GM specifically penned a letter earlier this year that warned of a smaller automaker domestically and abroad.
A week ago, GM announced it would idle four U.S. production plants and close one Canadian plant by the end of 2019. Two other international plants are also on the chopping block. The decision killed numerous passenger cars in the process; the Chevrolet Impala, Volt, Cruze, Buick LaCrosse, and Cadillac CT6 will no longer be offered in the U.S.
The White House has not made an official comment on China’s agreement to cut and remove tariffs on American-made vehicles.