As part of its trade-war mongering, the Trump administration has imposed 25 percent tariffs on auto imports from China (and has also proposed other automotive tariffs). The Chinese-car levy may be intended to head off an anticipated rise in global automakers’ practice of using China as a low-cost manufacturing zone for automobiles sold in the United States, or it might be aimed at keeping China’s domestic car companies from exporting to the United States. Currently, only three car models are imported to the U.S. from China: the Buick Envision, the Volvo S90, and the Cadillac CT6 PHEV. Now, General Motors is trying to get the Envision excused from those tariffs.
GM filed a request for an exemption with the U.S. Trade Representative on July 30. In making its case, GM points out that while 41,000 Envisions were sold in the United States last year, the automaker sold nearly five times that many in China—210,683 in 2017 alone. The company claims that, because the vast majority of Envision sales are in China, it makes sense to build the vehicle there, and that volumes here are too small to justify also producing it in the United States.
GM also claims in its statement that moving manufacturing of the Envision is “not feasible, as the time required for doing so is longer than the remaining life cycle of the current product” and suggests that “GM may need to cease selling the Buick Envision in the U.S. market altogether” if it has to pay the 25 percent tariff and import the product “at a loss.”
While GM is envisioning a sweet exemption for its compact SUV, it has taken measures in case that doesn’t come through: It imported a six-month supply of the vehicle before the higher tariffs went into effect on July 6.