Experts say: Sino-US trade war will lead more car companies to produce vehicles in China
On July 18th, Beijing time, Bill Russo, founder and CEO of Shanghai-based consulting firm Automobility, said in an interview with foreign media that the Sino-US trade war may prompt some automakers to produce more vehicles in China.
The Chinese government imposed a 25% tariff on imported US cars in response to US tariffs on Chinese goods, including Chinese-made cars, of $34 billion.
In response to retaliatory tariffs between China and the United States, Tesla has increased its vehicle prices in the Chinese market. At the same time, Tesla will wholly develop a Tesla super factory integrating R&D, manufacturing and sales functions in the Shanghai Lingang area. The project plans to have an annual production capacity of 500,000 pure electric vehicles. In addition, Tesla also registered the Tesla Beijing Technology Innovation Center in Beijing.
Luo Wei also said that China's auto market is very large, with 28.8 million units sold in 2017. In this case, Rowe concluded that auto companies that export cars to China may choose to localize production in China to avoid tariffs.
Luo Wei explained, “Last year, about 2,800 vehicles were sold in the Chinese market, and about 1.2 million imported cars. In the United States, less than 300,000 cars are sold or produced each year. Therefore, tariffs will actually Companies that do imported car business are losing their competitiveness in the market."
Luo Wei also added that tariffs will have a negative impact on the automotive industry. To achieve cost-effectiveness, some brands imported into China may have to reconsider their production layout. However, shifting production to China may result in fewer job opportunities in the US auto industry.
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