General Motors pondering production increase in China 0
The new regulations will accelerate plans for General Motors, one of the world’s largest car producers, to expand their business in China.
The decision to add a tariff on U.S imported car comes after their appeal to add a tariff on U.S tyre imports were soundly rejected. The country is clearly looking at methods of raising funds during what is the biggest slowdown in China’s automotive industry for 13 years.
Jurgen Pieper, a Frankfurt based analyst who works for Bankhaus Metzler said that the Chinese automotive market needs to break out of their current stage of decline as many other markets depend on them. He said “The move shows that China is always capable of intervening politically in its markets,”
“The auto-mobile industry is very dependent on China for growth, and there are doubts about the pace of future expansion.”
Chrysler, one of General Motors main brands will be affected by the tariffs. Ford is said to one of the fortunate companies who will avoid the charge.
This means that car imported from the United States of America will now be more expensive. If General Motors are to create cars in China, they would naturally bring down the overall cost as parts as well as labour would appear to be a lot cheaper.
America has understandably not taken to the news very well. A joint statement from the House Republicans and Democrats said “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,”
China and the U.S.A have had on going issues which may have brought about the current situation. The U.S.A has issues with China’s currency and the way the countries plans for it.
Whatever the issues are they are clearly affecting the world largest and second largest automotive industry in a negative way. The world’s overall motor industry depends on these particular regions to prosper. Let’s hope that the two countries can resolve their issues amicably.