Donald Trump is trying to confront the most globalized industry, and China. But the largest automotive market in the world will not move.
Beijing reduced tariffs on cars on July 1, just before Friday's imposition of US tariffs on $ 34 billion of Chinese products. China's automobile manufacturers, like their consumers, are the least vulnerable to outside forces compared to their counterparts elsewhere. The tariffs with which Trump intimidates the auto industry, on the other hand, will eliminate a bottom line, will make a hole in the pocket of every American buyer and will trigger job losses.
Part of the explanation for this contrast is that China's automakers are much less globalized than foreign brands that rushed into their market . In 2017, the nation exported almost $ 70 billion pieces and $ 14 billion automobiles. Imports were over $ 50 billion vehicles and about $ 40 billion pieces. In the months leading up to the current chaos, the Chinese two-way car trade with the rest of the world increased. The United States imported more automobile components from China than vehicles, but exported more cars to China. Some parts manufacturers, apparently vulnerable with an exposure to income of almost 50 percent in the United States, already have facilities in the United States and other countries.