China slashes tariffs on imported cars

China is cutting the tariffs it charges on imported cars, giving a potential boost to foreign automakers in the world...

Posted: May 22, 2018 3:31 PM
Updated: May 22, 2018 3:31 PM

China is cutting the tariffs it charges on imported cars, giving a potential boost to foreign automakers in the world's largest market.

The Chinese Finance Ministry said Tuesday that it will cut import duties on passenger vehicles from 25% to 15%, starting July 1.

The announcement, which fulfills an earlier pledge by Chinese President Xi Jinping, comes just days after China and the United States agreed to a ceasefire in their recent trade hostilities.

President Donald Trump singled China's import duties on cars for criticism last month, pointing out that they're far higher than the 2.5% the United States charges on imported cars. "Does that sound like free or fair trade?" Trump tweeted. "No, it sounds like STUPID TRADE - going on for years!"

Related: How American cars are really sold in China

The following day, Xi announced during a closely watched speech that China would "significantly lower" auto tariffs and carry out a series of other measures that he portrayed as "a new phase of opening up" for the world's second-largest economy.

Bill Russo, founder of Shanghai-based consultancy Automobility, called the lowering of car tariffs a "very significant move" that's likely to give foreign automakers a better chance of competing on cost with local manufacturers.

Germany's Porsche reacted quickly to China's announcement, saying on Tuesday it "welcomes the tariff reduction policy" and would consider lowering its prices for the Chinese market.

"Chinese customers will have [the] chance to enjoy an even [more] optimized price and pursue more personalized options when buying a car," it said in a written statement.

Others that stand to gain are high-end brands that ship expensive cars to China, such as BMW and Mercedes-Benz, Russo said.

The gains for big US automakers like GM and Ford are likely to be more limited. The lion's share of the cars they sell to Chinese consumers are already manufactured inside China.

The United States has been increasing its auto exports to China, though, despite the heavy duties. It sent $10.5 billion of cars -- new and used -- to China last year, up from $8.8 billion in 2016, according to the US Census Bureau.

The Chinese government also said Tuesday that it will reduce charges on imported auto parts to 6%, down from the current levels of between 8% and 25%.

Related: Global car makers unlikely to go it alone in China

As well as cutting tariffs, the Chinese government has also promised to remove restrictions on foreign carmakers that want to manufacture vehicles in the country.

Previously, companies such as GM and Volkswagen had to establish joint ventures with local partners in which the Chinese companies have the controlling stake.

But last month, China said it will phase out those rules by 2022. It will start by lifting the restrictions on manufacturers of electric vehicles this year.

-- Steven Jiang and Alice McCool contributed to this report.

Indiana Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 35712

Reported Deaths: 2207
CountyConfirmedDeaths
Marion10037594
Lake3806202
Allen174371
Cass15927
Elkhart143529
St. Joseph132035
Hamilton118094
Hendricks118074
Johnson1120110
Madison59761
Porter55329
Clark52841
Bartholomew52238
Howard43734
LaPorte43624
Tippecanoe4214
Shelby39822
Jackson3942
Delaware38740
Hancock34928
Floyd32140
Boone31835
Vanderburgh2902
Morgan28324
Noble25121
Montgomery24417
Clinton2401
White2389
Decatur23031
Grant22123
Dubois2053
Harrison19622
Henry18412
Vigo1758
Greene17125
Dearborn17021
Monroe17012
Warrick16728
Kosciusko1661
Lawrence16524
Marshall1472
Miami1411
Putnam1377
Orange13122
Jennings1314
Scott1223
Franklin1158
Ripley1086
LaGrange1022
Daviess9516
Carroll933
Steuben872
Wayne865
Wabash802
Fayette797
Newton7810
Jasper701
Jay530
Clay522
Washington511
Rush503
Randolph503
Fulton501
Pulaski490
Jefferson471
Whitley443
DeKalb431
Starke393
Sullivan371
Owen341
Perry340
Huntington342
Brown331
Benton320
Wells320
Knox310
Blackford272
Tipton261
Crawford240
Fountain222
Switzerland210
Spencer211
Adams201
Gibson182
Parke180
Posey160
Ohio130
Warren121
Martin120
Vermillion100
Union90
Pike60
Unassigned0175
West Lafayette
Clear
86° wxIcon
Hi: 85° Lo: 67°
Feels Like: 89°
Kokomo
Scattered Clouds
81° wxIcon
Hi: 85° Lo: 66°
Feels Like: 84°
Rensselaer
Scattered Clouds
81° wxIcon
Hi: 83° Lo: 64°
Feels Like: 83°
Fowler
Scattered Clouds
81° wxIcon
Hi: 87° Lo: 65°
Feels Like: 83°
Williamsport
Clear
81° wxIcon
Hi: 85° Lo: 66°
Feels Like: 84°
Crawfordsville
Scattered Clouds
79° wxIcon
Hi: 82° Lo: 67°
Feels Like: 80°
Frankfort
Overcast
83° wxIcon
Hi: 85° Lo: 67°
Feels Like: 85°
Delphi
Scattered Clouds
80° wxIcon
Hi: 87° Lo: 66°
Feels Like: 82°
Monticello
Scattered Clouds
80° wxIcon
Hi: 84° Lo: 65°
Feels Like: 82°
Logansport
Scattered Clouds
81° wxIcon
Hi: 82° Lo: 65°
Feels Like: 83°
Isolated storms & humid......
WLFI Radar
WLFI Temps
WLFI Planner

COVID-19 Important links and resources

As the spread of COVID-19, or as it's more commonly known as the coronavirus continues, this page will serve as your one-stop for the resources you need to stay informed and to keep you and your family safe. CLICK HERE

Closings related to the prevention of the COVID-19 can be found on our Closings page.

Community Events