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China to levy tariffs on U.S. automakers for sedans, SUVs


This news story was published on December 15, 2011.
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By Todd Spangler, Detroit Free Press

WASHINGTON — China’s Commerce Ministry announced Wednesday it will levy tariffs on U.S. automakers for imports of sedans and SUVs, touching off bipartisan criticism of Chinese officials in the nation’s capital.

House Ways and Means Chairman Dave Camp, R-Mich., and the committee’s ranking Democrat, Rep. Sander Levin, D-Mich., issued a joint statement saying that China’s action, which will directly affect Detroit-area automakers, is unjustifiable.

“Unfortunately, this appears to be just one more instance of impermissible Chinese retaliation against the United States and other trading partners,” the congressmen said in the statement.

They added that it appears the decision violates China’s commitments to the World Trade Organization and asked President Barack Obama and his trade officials to “exercise all available option to enforce U.S. rights.”

According to China.org.cn, the authorized government Web portal to China, the Commerce Ministry announced anti-dumping and anti-subsidy duties on sedans and SUVs with engines of 2.5 liters and above imported from the U.S. The statement said an investigation showed evidence of dumping — a term for selling products at prices below those supported by local competition.

Effective Thursday, importers of related vehicles from the U.S. will be required to set aside deposits with Chinese customs ranging from 2 percent to 12.9 percent of sales, according to the level of dumping and the level of subsidy U.S. automakers received from their government, the ministry said.

The duties will expire on Dec. 14, 2013.

The ministry said U.S. automakers, including General Motors Co. and Chrysler Group LLC, received government subsidies and dumped their vehicles in to the Chinese market, which harmed China’s auto industry. The Obama administration and, before it, the administration of President George W. Bush, invested some $80 billion in taxpayer funds to rescue the two companies.

According to the U.S.-China Business Council, the U.S. exported $4.5 billion worth of vehicles to China in 2010, an increase of more than 130 percent from the previous year. But for GM at least, the duties should only affect about 11,000 larger vehicles, including the Buick Enclave, Cadillac CTS and Cadillac Escalade.

GM noted that it has long supported the development of China’s auto industry and that its imports are less than half of 1 percent of the company’s domestic production in China.

“GM and its partners are working with relevant authorities to understand the impact of the Chinese government’s decision to lift the suspension of anti-dumping and countervailing duties and to seek a solution consistent with a constructive global trade environment, which we believe is important to both China and the U.S.,” the company said in a statement.

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©2011 the Detroit Free Press

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