On May 22, the Ministry of Finance announced the reduction of automobile import tariffs, and the tariff of whole vehicle was reduced from 25% to 15%. It began to implement on July 1. All major car companies actively responded to the national tax reduction policy and issued official price reduction announcements. .

On June 15, the United States announced a list of China’s 50 billion U.S. imports that will impose a 25% tariff. On the early morning of June 16, the State Council announced that it imposed a 25% tariff on the US$50 billion in commodities that originated in the United States. Among them, automotive products began to be implemented on July 6 and the U.S. import vehicle tariff rose to 40%.


"Variables" make consumers, dealers, and car companies overwhelmed, and can only wait and see, and then respond. Then, this policy adjustment to the market's "uncertainty" for the development of China's auto industry Is it good or bad?


In 2017, the United States produced a total of 280,200 exported cars in China, of which Mercedes-Benz and BMW’s high-end SUVs accounted for a large proportion. In China, sales of the BMW X4, X5, and X6, the X7, which is about to be put into production, are produced in South Carolina, and Mercedes-Benz’s two top SUVs, GLE and GLS, are manufactured in Alabama, USA. In 2017, the BMW X5 became the biggest winner in the sales volume of medium and large-sized imported SUVs, with a total of 51,878 sold; the Mercedes-Benz GLE ranked third with 31,198 units sold; the BMW X6 sold 8,927 units. After the implementation of punitive tariffs, it is very likely that the price of the United States' production of the X5 will be 10% more expensive than the German production of the Porsche Cayenne, which will significantly weaken the competitiveness of Mercedes-Benz and BMW's high-end SUVs.

The biggest influence among US-based brands is Lincoln and Tesla. All models of the two brands are imported from the United States. Grand Cherokee and Wranglers under the JEEP brand will also be affected. For two Japanese brands of high-end SUVs, the Infiniti QX60, QX80, and Acura MDX, the competition is not very competitive, and the implementation of punitive tariffs is absolutely fatal.


China’s status as the world’s largest auto consumption market cannot be changed, and China’s auto consumption has entered the stage of consumption upgrade. It has great demand for luxury brands and sales of luxury large-scale SUVs have also been rising. These luxury brands produced in the United States cannot easily give up the excellent situation of letting go in China.

Lincoln and Tesla had originally planned to produce in China. The Sino-U.S. trade war will, on the contrary, firm up the determination to put into production in China and speed up the progress of production.

We often say that the Chinese market has the world. China's auto market has long been the largest single market in the world. Regardless of Mercedes-Benz, BMW, Volkswagen or Audi, China is without exception the largest sales market. At the same time, the Chinese market coincides with the “transition period,” and young people have become the main force of consumption, and consumption concepts and consumption levels are in the stage of upgrading. Luxury brand bicycle profits are extremely high, because it is obviously unwise for policy adjustments to abandon the Chinese market.

So, accelerating the process of localization or will be the best solution.


At present, the main brands of luxury brands in the Chinese market are concentrated on Class B vehicles. In 2017, Audi Q5 and Q3 models have sold more than 230,000 units in total. Mercedes-Benz GLA and GLC have sold more than 200,000 units in total. BMW 3 Series and 5 The cumulative sales of over 240,000 vehicles. It is worth noting that with the introduction of Q5L pre-sale, domestic GLC, and domestic new C-class introduction, the luxury brand B-class car market has basically completed the process of localization.

Whether Mercedes-Benz or BMW will "benefit from misfortunes", with the continuous improvement of China's consumption level, the next "damp" is likely to be a large luxury SUV. In the face of fierce market competition, whoever can first decide to carry out domestic production will be able to take the initiative. Who will be the first to eat crabs on the BMW X5 and Mercedes-Benz GLE?


Secondly, looking back at the U.S. market, tariffs on imported cars in China have been raised. Does it really block out Chinese cars?

The data shows that in 2017 China’s total vehicle exports to the United States totaled about US$600 million, which did not open the US market and would not have a critical impact for the time being. Second, the tariff increase may provide more opportunities for Chinese cars to open the door to the American market.

Some foreign media reported that more and more automakers are considering producing low-profit vehicles outside the United States. For example, Ford announced in June 2017 that it would relocate its sedan-fox production operations from Michigan to China. If GM and Ford continue to lower their sales in the United States, jobs at US factories are bound to decrease. Even Tesla announced recently that it would undergo a large-scale restructuring and layoffs of at least 9% to nearly 4,100 people. In the long term, there will be a large number of manufacturing talents coming to the market.

In November 2017, according to foreign media reports, Zhejiang Geely Holding Group's lead-brand has been planned for sale in Europe in 2019, and will be listed on the US market in 2020. Leading executives revealed that the company is currently working with Volvo to consider the production of new lead-in vehicles at its plant in South Carolina, USA.


Among its own brands, Guangzhou Automobile has been very determined to enter the US market and has participated in the North American auto show for four consecutive years. At the beginning of this year, Guangqi Chuanqi was a full-model model. In 2017, GAC Express established North American Research Center in Silicon Valley, held three overseas talent recruitment activities in Silicon Valley, Detroit and Boston, and this year, GAC Communications will establish a North American sales company and participate in the annual meeting of the American Automobile Dealers Association. To further develop dealer resources and networks, and make full preparation for entering the North American market in 2019.

Great Wall Motor’s “Haver” and “WEY” brand plans to enter the North American market in 2020 and 2021, respectively. Wei Jianjun, chairman of Great Wall Motor Co., Ltd., revealed that he entered the US market and may use three auto companies to build factories. New model.

In addition to Guangzhou Auto Transmission and Great Wall Motors, Geely Automobile and Chery Automobile have already announced their plans to visit the United States. If tariff policies are to maintain the status quo for a long time, the loss of manufacturing talents will greatly help Chinese auto brands enter the US market.


Of course, the tariff increase is not without drawbacks. At present, models produced in the Chinese market and sold in the United States are not uncommon. Although the body size is still small, but with the rapid development of Chinese cars, this situation will gradually spread.

For example, Biekeangkewei, the car began production in China in 2016, then returned to the United States in 2017, and was the first Chinese-made product to land on the US car market. There are also second-tier luxury car brand leader Cadillac, the US-made luxury brand, also began to sell locally produced models from China - CT6 plug-in mixed version, which invisible among the acknowledged the level of Chinese manufacturing and strength.

Not only that, the Volvo S60 models are currently being produced and sold by the Chinese to the United States. For another example, the strategic adjustment of Ford Motor Company recently suspended the sedans business in the North American market, mainly developing such models as pickup trucks and SUVs. The sedans and other products were all produced by China and entered the American automobile market in the form of imports.

Some agencies predict that the number of cars imported from China by China in 2023 is expected to reach 500,000. However, if the tariff policy maintains the status quo and loses the "China-made" price advantage, it will be difficult to go further in volume.


The increase in tariffs has advantages and disadvantages for the Chinese/American auto industry. For Chinese cars, it may be the best time to build factories in the United States. The rise of self-owned brands, the dazzling data of the Chinese auto market for many years, and the rapid increase in the level of manufacturing have made Chinese cars more room to fight when they are “targeted”.

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