Chinese carmaker eyes U.S. market but might rethink name

Models were on Chinese roads long before real estate tycoon with similar name arrived in White House

GUANGZHOU, China — The cars are called Trumpchi (though their Chinese maker insists the name is just a coincidence).

Various models of Trumpchi cars have been motoring down Chinese roads for the past seven years, but even after the United States elected a real estate tycoon with a similar name as president, the world ignored them.

Now the company that makes Trumpchis hopes that will change — and China appears to believe the rest of its auto industry is ready to go global, too.

GAC Motor said Friday it would begin selling Trumpchis in the United States by the end of 2019. The company hopes it will be the first Chinese car brand to take off in a market that has eluded the country’s manufacturers.

Trumpchis have gained a devoted following in China. The brand’s burly GS8 midsize SUV, the first model that the company plans to sell in the United States, and its spacious new GM8 minivan have sleek lines and levels of fit and finish close to those of Japanese automakers.

Top executives and their advisers are agonizing, however, over whether, and how, to change the name for the U.S. market. “There’s no Obama-mobile, that’s a cultural thing, there’s no Clinton car,” said Robert C. Maling Jr., a retired Lexus executive who is now an adviser to GAC. “It would be confusing to the American public to have the Trumpchi name.”

The Chinese government broadly appears to be gearing up for large-scale exports. China’s auto industry has grown into the world’s largest, producing more cars each year than the United States and Japan combined while shielded from imports by the highest trade barriers by far of any major car market. Those policies forced multinationals to move factories and their latest technology to China.

But Beijing is now discussing slight reductions in those restrictions. It is largely to prevent foreign governments from citing them as a reason to apply their own limits on Chinese automotive exports.

Unlike any other car-making power, China requires multinationals to produce cars in 50-50 joint ventures with local companies, to help its domestic businesses learn the latest manufacturing techniques. But in statements over the past two weeks, the government has said that it may relax that rule somewhat for electric cars made in foreign trade zones.

China also said right after President Donald Trump left Beijing a week ago that it would consider a gradual cut in its import tariffs. China charges a 25 percent tax on imported cars, compared with 2.5 percent in the United States.

Cars made in free trade zones must still pay the 25 percent tariff if they are shipped to Chinese dealers instead of being exported. But those rules also appear to be softening. In recent discussions with Tesla, the U.S. electric car company that wants to build a wholly owned factory in a Shanghai free trade zone, Chinese officials have been looking into possibly reducing the tariff as well, two people familiar with the discussions said.

A formula being considered would apply the 25 percent tariff only to imported components in each Tesla car, said one of these people, who insisted on anonymity because the discussions were continuing.