Concern about the imposition of Chinese electric cars in the United States is increasing exponentially. Trump has responded to it.
Chinese automobile brands have started what is known as the price war, taking into account their strong presence in the European market, thus offering really low prices. Many talk about dumping or, in other words, unfair competition, and this is why Europe, and now the United States, want to stop the situation.
BYD, a Chinese electric vehicle manufacturer, has recently requested a delegation to Jalisco (Mexico) to study the possibility of building a production plant in the state. Given this, concern about the growing imposition of manufacturers in the West is raising several alarms.
And it has been Donald Trump who has responded to the promise made by Joe Biden, current president of the United States, to protect Americans from Chinese manufacturers. For this reason, he has threatened a 100% tariff for those Chinese cars that cross from Mexico.
Trump appeals to Xi Jinping
Former president and 2024 GOP presidential candidate Donald Trump issued a threat during an event in Ohio to Chinese automakers, warning them of an even higher tariff if they set up factories in Mexico to evade existing tariffs.
During his presidency, Trump imposed a 25 percent tariff on cars made in China. Additionally, he promised to increase tariffs to 50 percent on vehicles manufactured in Mexico at Chinese-owned plants.
Now, the former president has upped the ante by threatening to impose a 100% tariff on Chinese vehicles entering the United States through its southern neighbor, in this case, Mexico. And, as NBC has reported, these were his words:
“If you are listening to me, President Xi [Jinping] -and you and I are friends-, he understands my way of negotiating. Those big, monstrous car manufacturing plants you're building in Mexico right now… you're not going to hire Americans and sell the cars to us, no,” Trump said. “We're going to put a 100% tariff on them. to every car that crosses the line, and you're not going to be able to sell those cars if I'm elected,” he added.
The White House is studying the BYD Dolphin situation
Trump made this statement last Tuesday at an event aimed at mobilizing support for the Republican Senate candidate, Bernie Moreno, whom he has endorsed. The former president warned that if he is not re-elected, it would spell disaster for the country and its automotive sector, describing it as “a potential bloodbath.”
The presidential candidate's statements come after the Biden Administration announced that it has tasked the Secretary of Commerce with investigating the risk that Chinese vehicles pose to American drivers and the measures it can take to protect citizens from it.
The White House is also reportedly studying the possibility of expanding tariffs to prevent Chinese vehicles from entering the country through Mexico. To do this, he will likely expand tariffs first introduced under the Trump administration.
The 25 percent tariff is a big reason why Chinese automakers have no real presence in the country, as they do in Europe and other markets. However, experts believe the tariff may not stop Chinese automakers from considering the market much longer.
While plants in Mexico offer a potential solution for the industry, the economic downturn in China has led automakers to explore new markets to maintain their sales momentum.