Donald Trump has been elected because the forty seventh president of the US, returning to the Oval Office 4 years after he last held the position.
His return to power has been one in every of controversy, along with his opponents putting an emphasis on how the now 78-year-old will handle his second presidency, and what it means for the worldwide partners and enemies of the US.
Australia has long been an ally of the US, but since we not manufacture our own vehicles from scratch, the local automotive industry could be influenced by external aspects, corresponding to what occurred in American politics overnight.
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Within the leadup to the election, Mr Trump sought to win the swing state of Michigan – which he achieved – by targeting the region’s automotive industry, home to the ‘Big Three’ carmakers: Ford, General Motors (Chevrolet, Cadillac, GMC) and Stellantis (Jeep, Ram, Dodge, Chrysler).
In July, the president-elect not only hit out on the chief of the United Auto Staff (UAW) union, but additionally pledged to extend tariffs on vehicles made outside of the US by Chinese carmakers.
“We’re going to bring back automobile manufacturing and we’re going to bring it back fast,” said Mr Trump.
“[The Chinese] are constructing a number of the largest auto plants on the planet… Those plants are going to be in-built the US and our individuals are going to man those plants.
“And in the event that they don’t agree with us we are going to put a tariff of roughly 100-200 per cent on each automobile they usually can be unsellable within the US.”
His declaration got here months after now-departing president Joe Biden also announced a 100 per cent tariff on Chinese electric vehicles (EVs) in May.
While there’s only a handful of Chinese-built model sold within the US, corresponding to GM’s Buick Envision and Ford’s Lincoln Nautilus, there are a handful of auto brands owned by Chinese conglomerates that sell cars there, including Lotus, Polestar, and Volvo.
The Polestar 2 is currently the one US-market EV that’s in-built China by a Chinese company, making it subject to the numerous potential tariff.
Other brands corresponding to BYD were understood to be excited about opening factories in Mexico to export automobile to the US, but with Mr Trump also pledging to position tariffs of as much as 200 per cent on vehicles made south of the border, this might be a largely unprofitable exercise.
So what does all this mean for Australia?
With Chinese brands less more likely to enter the US market, they’ll need to begin taking a look at other regions for exports.
That’s been made harder by the European Union, which recently imposed tariffs of as much as 45.3 per cent on Chinese EVs.
Nonetheless, Australia not only has a Free Trade Agreement with China, but motorists are already buying vehicles made on the planet’s second most populous nation of their droves, with only Japan and Thailand still supplying more vehicles for our market.
Australia still has a comparatively small new-vehicle market, but it surely’s also one in every of the world’s best, with near 60 auto brands either currently on sale or attributable to launch locally.
At a time when so-called ‘legacy’ manufacturers, corresponding to Citroen, have been departing showrooms attributable to slowing sales, the influx of brands from China is seemingly never-ending.
Last week, Jack Puzin, the CEO of EV Automotive – the Australian distributor for Chinese EV maker Skywell – named tariffs within the US and Europe as a driving force behind the rise of competition here, as brands develop into shut out of other markets.
“World wide, the Europeans and Americans are ostracising the Chinese,” Mr Puzin told CarExpert.
“Obviously, their market is spilling into in every single place else they will sell, and Australia’s one in every of them.
“With such a generous Free Trade Agreement, why wouldn’t they?”
In contrast, there’s more likely to be little change for Australia should Mr Trump also impose tariffs on Mexican-made vehicles, as they represent about one per cent of local auto imports, in comparison with the circa-15 per cent figure for Chinese-made models.
This Article First Appeared At www.carexpert.com.au
