China Slaps “Anti-Dumping And Anti-Subsidy” Duties On US-Made Cars

The Chinese government has unexpectedly imposed new anti-dumping and anti-subsidy tariffs on sport utility vehicles and midsize and large cars imported from the US, in what many believe to be a retaliatory move against similar actions by the US towards Chinese-made products.

The new tariffs, which will take effect on Thursday, are largely seen to be a symbolic gesture, considering how many US automakers now primarily make much of what they sell in China domestically through joint ventures with other Chinese auto companies.

The Chinese government has unexpectedly imposed new anti-dumping and anti-subsidy tariffs on sport utility vehicles and midsize and large cars imported from the US, in what many believe to be a retaliatory move against similar actions by the US towards Chinese-made products.

The new tariffs, which will take effect on Thursday, are largely seen to be a symbolic gesture, considering how many US automakers now primarily make much of what they sell in China domestically through joint ventures with other Chinese auto companies.

General Motors, for instance, said on Wednesday that the number of cars it imported into China was less than 0.5 percent of its domestic production in China. Chrysler also admitted that only about 3,800 of the 22,000 vehicles the company sold in China last year were imported from the US.

Still many US politicians have been outraged by China’s move, with four senior lawmakers writing a joint statement to President Barack Obama, describing the new Chinese tariffs as “unjustifiable.”

“We are extremely concerned by China’s announcement today that it will impose new duties on U.S. auto exports,” wrote the group, which included Representative Dave Camp, chairman of the House of Representatives Ways and Means Committee, and Representative Sander Levin, the panel’s top Democrat. Both are from Michigan, a major auto-producing state.

[quote]”China’s actions are unjustifiable and, unfortunately, this appears to be just one more instance of impermissible Chinese retaliation against the United States and other trading partners,” the statement added, as cited by Reuters.[/quote]

The Obama administration are also said to be “disappointed” by China’s announcement, with Andrea Mead, a spokeswoman for the U.S. Trade Representative, claiming that the Chinese policies had “violated multiple WTO rules.”

China’s decision to increase import levies comes just three months after the WTO rejected its appeal to stop US duties on Chinese tire imports. Domestic sales by Chinese auto companies are also rising at its slowest pace in 13 years, with local producers facing decreasing revenues while foreign carmakers posted gains.

In a statement on Wednesday, China’s Commerce Ministry said that its action was merely a response to damage to its car industry from US “dumping and subsidies”. Earlier in the year, Chinese officials had also questioned whether the Obama administration was providing too much federal assistance to General Motors and Chrysler, particularly in the aftermath of the global financial crisis.

According to China’s Trade Minister Chen Deming, China expects trade disputes to increase next year because of economic weakness in the United States and Europe.

Related: China “Deeply Concerned” With US’s “Strong Tendency For Trade Protectionism”

Related: Chinese Solar Company Drops $500 Million US-Based Project Over Trade Row

[quote]”If we look at countries around us, for example Europe and the United States, we’re all going to face difficulties brought about by these two areas,” said Chen during a press conference in Geneva earlier this year, as quoted by the Economic Times. [/quote]

Chen had also warned in late November that the country was likely to fight back if other countries resorted to protectionism against their products.