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The GMC Yukon, an iconic vehicle from General Motors, is pictured here. |
According to Carscoops, shortly after President Donald Trump imposed a 10% tariff on Chinese imports to the US, China retaliated with an additional 10% tariff on American-made automobiles.
This move came as a result of the two countries failing to reach an agreement, marking an escalation in the potential for a full-blown trade war.
Earlier this week, China officially implemented a 10% import tax on large-engine vehicles with engines larger than 2.5 liters, in addition to the existing 15% tariff.
Although there are relatively few US-made models with engines above this displacement sold in China, customs data reveals that the US exported approximately 3.1 billion USD worth of these vehicles globally in 2024.
Some automakers are expected to be hit harder by China’s new tariff policy.
Since 2022, General Motors has been exporting the GMC Yukon and Chevrolet Tahoe to China through the premium importer, Durant Guild.
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The Chevrolet Tahoe, another renowned vehicle from General Motors, is showcased in this image. |
Mercedes-Benz and BMW will also be impacted by China’s new tariff policy, as both German automakers produce a number of SUVs in the US for the Chinese market.
Michael Dean, an analyst from Bloomberg Intelligence, notes that Mercedes is likely to be more affected by China’s tariffs than BMW. This is because BMW has been producing the X5 in China since 2022 through its joint venture, BMW Brilliance, thereby circumventing the additional tax.
Mr. Dean also believes that the new tax policy in China could result in a 1.5% decrease in Mercedes-Benz’s pre-tax profits this year.
China has further imposed tariffs on US goods this week, including a 10% tariff on liquefied natural gas and a 15% tariff on imported crude oil from the US.
Additionally, China has implemented export controls on 25 rare earth metals, many of which play a critical role in electronic products and military equipment, including tungsten used in aerospace.
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