A bipartisan group of U.S. lawmakers is looking on the Biden administration to extend tariffs on Chinese-made vehicles and take measures to stop Chinese corporations from using Mexico as an export gateway to the US. In a letter addressed to U.S. Trade Representative Katherine Tai, Representative Mike Gallagher, a Republican who chairs a select committee on China, together with the committee’s top Democrat, Raja Krishnamoorthi, and Michigan Representatives Haley Stevens and John Moolenaar expressed their concerns.
The lawmakers are advocating for an adjustment to the prevailing 25% tariff on Chinese vehicles, emphasizing the importance of not only maintaining but raising these tariffs to counter the expected surge in Chinese imports. This tariff, initially imposed in the course of the administration of former President Donald Trump, was subsequently prolonged by the Biden administration.
The letter further suggests that the U.S. Trade Representative should consider initiating a brand new Section 301 investigation into Chinese vehicles. This investigation would assess the potential harm posed to the American automotive industry and its workforce and determine the vital actions to counter China’s industrial strategy aimed toward dominating the worldwide automobile market.
The lawmakers also highlight the must be prepared for the growing influx of Chinese vehicles exported from other trading partners, particularly Mexico. They argue that Chinese automakers are strategically establishing operations outside China to reap the benefits of preferential access to the U.S. market through existing free trade agreements.
This call for increased tariffs and investigations is rooted in concerns raised by automakers in the US. The Alliance for Automotive Innovation CEO, John Bozzella, had previously warned that proposed U.S. environmental regulations could provide China with a stronger foothold in America’s electric vehicle battery supply chain and the automotive market.
In the same vein, the European Commission had initiated an investigation into imposing punitive tariffs to safeguard European Union producers against cheaper Chinese electric vehicle (EV) imports. The U.S. lawmakers imagine that collaboration with allies is crucial to formulate a coordinated response that collectively mitigates the demand for these vehicles of their respective markets.
The letter also highlights the proven fact that lots of the electric vehicles (EVs) exported from China are produced by Western brands like Tesla, which have substantial manufacturing capability in China. Moreover, the lawmakers note that some U.S. automakers are themselves importing Chinese-made vehicles into the US, underscoring their belief that the prevailing tariff level on imported vehicles is insufficient.
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This Article First Appeared At www.automotiveaddicts.com