China Gives Tesla, Ford, General Motors and Trump One Awesome Present

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China Gives Tesla, Ford, General Motors and Trump One Awesome Present

 

Rev up those auto plant engines. 

In the matter of a day, China may have helped Donald Trump get re-elected and assisted in giving a nice bottom-line boost to U.S. automakers Tesla (TSLA) , Ford (F)  and General Motors (GM) . China said it will cut the tariff to import cars to around 13.8% from the current level of 25%, while reducing the levy on imported car parts to 6% from 10%. The reductions will take effect on July 1.

 

For Trump, the concession by China is a win seeing as he came to power on the back of frustrated manufacturing workers (among other classes, of course). For the major U.S. automakers, the decision likely will put more money in their pockets by allowing them to more profitably sell cars in the world's biggest auto market. The decision arrives at a crucial time for U.S. automakers -- with gas prices trending higher the group's pivot to SUVs and trucks from more fuel-efficient cars may crimp profits this year.

 

Ford perhaps has one of the most ambitious plans for China. The company said late last year that it aims to have 50 new vehicles in China by 2025, including eight all-new SUVs and at least 15 electric vehicles from Ford and Lincoln.

 

Meanwhile, China's high tariffs have long meant Tesla's already expensive autos are simply out of reach for many Chinese. On average, Tesla customers in China reportedly pay 1.5 times more for their electric cars than U.S. Tesla customers. 

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thatha great man