A speedbump for U.S. auto sales in China

A salesman walks past a billboard featuring the trademarks belonging to U.S. auto maker General Motors. The Chinese government will now start placing taxes on imported cars there.

Steve Chiotakis: Starting today, the Chinese government says it'll levy duties on imported cars made in the United States, which came as a big surprise to U.S. automakers.

As Marketplace's Rob Schmitz reports from Shanghai, it's the latest move in what's becoming a very nasty trade spat between the two countries.


Rob Schmitz: For U.S. automakers that export cars to China, here's the good news about these new fees:

Michael Dunne: Theres no colossal setback here.

Auto Industry expert Michael Dunne says these duties will impact less than 5 percent of U.S. cars sold in China. That's because many automakers don't export to China -- they make what they sell domestically through joint ventures. But here's the bad news for U.S. automakers:

Dunne: China has targeted the most profitable cars that American companies sell into China.

-- vehicles like big SUVs that aren't typically made in China. So why is China doing this? Dunne says it's revenge. The U.S. recently launched an investigation into China's solar industry. U.S. solar manufacturers allege Chinese solar companies are illegally dumping their panels onto the U.S. market.

If the U.S. wins the case, Chinese solar companies stand to lose billions in sales to U.S. consumers. And it would represent a significant step in what is becoming an increasingly ugly trade dispute between the world's two largest economies.

In Shanghai, I'm Rob Schmitz, for Marketplace.

About the author

Rob Schmitz is Marketplace’s China correspondent in Shanghai.

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