US likely to impose 100% tariff on electric vehicle imports from China Report

The United States is set to impose a 100% tariff on electric cars brought in from China, as per a Financial Times report. If implemented, these new actions would significantly intensify the ongoing trade conflict between the US and China, potentially leading to reciprocal tariffs from the leadership of Xi Jinping in China.

The tariffs come as officials across the Democratic administration have expressed frustration over China’s manufacturing “overcapacity” of EVs and other products that they say pose a threat to U.S. jobs and national security.

In the past, both US President Joe Biden and his Republican rival, Donald Trump, have discussed adopting a firm stance towards China. This decision could offer a solid platform for the Democrats to showcase their anti-China stance in the lead-up to the US presidential elections scheduled for November this year.

Public sentiment in the US appears to be increasingly opposed to Chinese imports, with Ohio Democratic Senator Sherrod Brown even calling for a ban on Chinese EV imports. “Tariffs are not enough. We need to ban Chinese EVs from the US Period,” the Senator said, as per the Associated Press. 

In February, the Alliance for American Manufacturing, a US business group, issued a report cautioning that the influx of inexpensive Chinese automobiles into the American market “could end up being an extinction-level event for the US auto sector.” This report highlighted concerning details that have raised alarms among officials in the US administration, particularly because the auto industry contributes 3% to America’s GDP.

The fears came after the car model was launched by Chinese automaker BYD at a price of just $12,000 for people in China. The quality of craftsmanship in this vehicle competes with that of American-made electric vehicles (EVs) priced three to four times higher, prompting worries within the US automotive industry.

“China is now simply too large for the rest of the world to absorb this enormous capacity. Actions taken by the PRC today can shift world prices,” Treasury Secretary Janet Yellen said during her Guangzhou and Beijing in April. 

“And when the global market is flooded by artificially cheap Chinese products, the viability of American and other foreign firms is put into question,” she added. 

Image source: AFP