US prepares for 100% tariff on Chinese EV imports
What's the story
The United States is planning to increase the tariffs on electric vehicles (EVs) imported from China, according to the Financial Times. The proposed 100% tariff represents a four-fold increase from the existing 25% rate. The move is seen as a significant escalation in the ongoing trade war between the two nations, and comes in response to concerns over China's EV manufacturing "overcapacity."
Protectionist measures
Aim to protect US jobs, national security
Senior US officials have expressed concerns that China's EV manufacturing "overcapacity" threatens American jobs and national security. Both President Joe Biden and his Republican challenger, Donald Trump, have previously indicated their intentions to adopt a tough stance on China. This latest development could strengthen the Democrats' anti-China position ahead of the November US presidential elections.
Domestic support
Calls for a complete ban
Political opinion in the US seems to support this move, with Ohio Democratic Senator Sherrod Brown, advocating for a total ban on Chinese EV imports. "Tariffs are not enough. We need to ban Chinese EVs from the US Period," stated Senator Brown.
Market concerns
Chinese EV imports threaten US auto sector
The Alliance for American Manufacturing, a US business group, warned in a February report that the debut of cheap Chinese autos, could be an "extinction-level event for the US auto sector." The report underscored concerns that have caught the attention of US administration officials, given that the auto industry counts for 3% of America's GDP. These fears were heightened by Chinese automaker BYD's launch of an affordable car model priced at just $12,000 in China.