China Lowers Trade Tariffs On Foreign Vehicles And Auto Parts

Donald Trump must be ecstatic.

The United States and China have been slowly creeping towards a trade war, which has effected the cost and availability of automobiles. Not only has China imposed a 25% tariff on foreign cars, it has also held several cars at port. The 25% tariff has effected GM, which produces the CT6 hybrid in China. The high tariffs have also greatly impacted European automakers, although the issue is about to improve. According to Reuter's Adam Jourdan, China will cut its tariffs to allow for greater access to its enormous automotive market.

Starting on July 1, 2018, the tariff will be cut from 25% to 15% for most vehicles. The Chinese Ministry of Finance said in a statement that the move is to spur development in the local auto sector. Initially, the move will mainly help premium brands such as Audi, BMW, Mercedes-Benz, and Tesla. BMW said this is a "strong signal that China will continue to open up," and Audi said it was looking forward to "further liberalization and opening" of the Chinese market. A Nissan executive also added that the "Benefits are huge for our business, especially Infiniti." The German cars will be the biggest beneficiaries, due to the sheer number of cars they sell.

The reduced tariffs will help foreign automakers compete with local Chinese automakers on price. Toyota said it would reduce prices on cars that benefited from lower tariffs in order to be more competitive. China will also reduce the tariff on auto parts from 10% down to 6%. Donald Trump has been opposed to trade tariffs with China, so this news should make him very happy. US trade talks with China will continue, with working plans to eliminate China's long-standing rules on foreign ownership of businesses.

View the original article here

Porsche Unveils Five Models For China In Shanghai Following Record Sales

Thanks to strong sales, China is now more important to the German automaker than the American market.

Sorry America, but even though your sports car spending money has been and will likely always be of immense value to Porsche, it’s the Chinese market that’s currently the most important for the German automaker. Once again, Asia’s largest nation has taken a larger chunk of sales as well as a higher rate of growth to become the center of focus for what is now, thanks to crossovers like the Macan, an automaker hitting its growth spurt. To better cater to its customers in China and spur more growth, Porsche has unveiled five models at this year’s Auto Shanghai.

Being unpackaged in the mainland at the auto show was the Panamera Sport Turismo, which we first saw In Geneva, as well as the truly insidious 680 horsepower Panamera Turbo S E-Hybrid, which is coming to China exclusively in long-wheelbase Executive guise. Buyers not wanting that sort of corruptible power (because at the end of the day who really needs 680 horsepower in a car that only their chauffeur will drive?) can opt for the third reveal, the 330 horsepower Panamera Executive that spoils its buyers with extra legroom and gorgeous interior amenities but is best left home on track days. Those needing a second car for track work can feast their eyes on the 911 GTS and 911 CT3 Cup racing car.

These two constitute the fourth and fifth models that are being shown off in China for the first time. The split focus between performance and luxury cars highlights how diverse the Chinese market is. As we know well, legroom is a major selling point in China, but so is electrification as the government attempts to clean its smoggy cities by reducing vehicle emissions one plug-in hybrid at a time. On the other hand, China’s class of young elites have a taste for the sort of speed and style supplied by the 911 and the 718 Boxster and Cayman. The SUV boom, which has in no way avoided crossing over the Great Wall, will further bolster sales with the attractive Macan and Cayenne to fill in the gaps.

View the original article here

Here's Why Acura Will Stop Exporting RDX To China

Could some Ohio-based factory workers pay the price?

The third generation Acura RDX has just arrived and production is taking place this very moment in East Liberty, Ohio. But according to the Nikkei Asian Review, Honda will soon no longer export the RDX from the US to China because of the ongoing trade war between the two countries. It’s simply not worth it and passing the cost (at least some of it) of the 40 percent tariff down to the Chinese customers is not a good option.

The solution? Honda, like some other automakers, will switch to local Chinese production of a new version of the RDX specifically for that market by the end of this year. Conveniently enough, Honda already builds vehicles in China through two joint ventures it previously set up with Guangzhou Automobile Group and Dongfeng Motor Group.

Hondas are also quite popular in the world’s largest auto market with sales having reached 1.45 million units last fiscal year. That’s actually about 30 percent of the automaker’s total output. Not surprisingly, China is the Honda’s second largest production country after the US. A total of 1.64 million vehicles were built there last year as well.

But Honda saw the writing on the wall regarding the trade dispute between Washington, D.C. and Beijing before last July when those retaliatory tariffs began. It rightly figured the two countries would not resolve things in the near future.

Despite the switch to local Chinese production, however, some parts will still have to be imported from the US and, guess what, they too will be subject to that 40 percent tariff. But at the same time, Honda says the new Acura SUV will be about 20 percent cheaper than the current one. That’s all fine and good for China, Chinese workers and consumers, but what about the employees in Ohio? Will the elimination of RDXs built for China hurt overall factory production and potentially lead to a loss of jobs? It’s a worthwhile question and, hopefully, US demand for the new Acura RDX remains strong enough to withstand the hit.

(function(w,d,s,l,i){w[l]=w[l]||[];w[l].push({'gtm.start':new Date().getTime(),event:'gtm.js'});var f=d.getElementsByTagName(s)[0],j=d.createElement(s),dl=l!='dataLayer'?'&l='+l:'';j.async=true;j.src='https://www.googletagmanager.com/gtm.js?id='+i+dl;f.parentNode.insertBefore(j,f);})(window,document,'script','dataLayer','GTM-MJCGS3N');var _comscore = _comscore || [];_comscore.push({ c1: "2", c2: "28140907" });(function() {var s = document.createElement("script"), el = document.getElementsByTagName("script")[0]; s.async = true;s.src = (document.location.protocol == "https:" ? "https://sb" : "http://b") + ".scorecardresearch.com/beacon.js";el.parentNode.insertBefore(s, el);})();

View the original article here