China cuts car tariffs

Beijing issues peace offering to U.S. on trade

HONG KONG — China has carried out a pledge to cut tariffs on imported cars and car parts, the latest move by Beijing to ease trade tensions with the United States. The U.S. auto industry and its workers, however, might be unimpressed.

China’s Finance Ministry said Tuesday that it would trim tariffs on imported cars to 15 percent of their wholesale value, from 25 percent. It also cut tariffs on imported car parts, reducing them to a standardized 6 percent. Chinese tariffs on parts currently range from 6 percent to 25 percent, depending on the category, and average about 10 percent.

The moves are intended to address longstanding complaints from the Trump administration and global automakers that China’s tariffs on imported cars are much too high. Those tariffs are one reason that global automakers like Ford, General Motors, Toyota and Volkswagen have built enormous factories in China over the past two decades. Those factories, built and run with Chinese joint venture partners, have helped make China by far the world’s largest automaker.

Chinese tariffs will still be relatively high, however, and the change is unlikely to motivate automakers to shift production away from China. The United States has a tariff of 2.5 percent on cars, minivans and sport utility vehicles and a 25 percent tariff on imported pickups.

The drop “is a significant reduction, but it really won’t have much of an effect” on where automakers assemble vehicles, said James Chao, the chief Asia auto analyst at IHS Markit.

By cutting the tariff on imported car parts more than on imported cars, China may strengthen its role as the world’s largest car-assembling nation. Lower tariffs on imported components will make it more attractive for manufacturers to do much of their final assembly in China, since they will not have to pay as much to import high-tech parts made elsewhere.