Boycott US made auto products

On June 17 2009 General Motors Corp. signed a total value of approximately one billion U.S. dollars agreement of exports to China. The agreement reveals that General Motors will export entire vehicles, auto pares and relevant instruments or devices to China through General Motors (China) Investment Co., Ltd. and Shanghai General Motors from now to 2010. Exported entire vehicles include its auto brands such as Cadillac. GM hopes signing of the agreement can help Cadillac and its other auto brands to have better performance and stimulate its business in China. Additionally, according to agreement of the bulk vehicle imports signed by China Automobile Trading Co.,Ltd (CATC) and Chrysler Automobile Trading Co., Ltd. in Washington, Chrysler will export a total value of more than 400 million U.S. dollars of Jeep cars to Chinese auto market.

It now appears that these agreements are likely to be wishful thinking of the United States. On November 5 U.S. Department of Commerce preliminary ruled that it would impose a punitive anti-dumping tariff up to 99.14% on imported Chinese made oil well pipes. Previously, China also formally started review process of anti-dumping and countervailing duty investigations on imported US cars.

Imported US cars are under increasing pressure caused by case of special protection of the tire between USA and China. Chinese government’s investigations against the United States’ auto products mainly refer to entire vehicles and may proceed from the direction of anti-subsidy. As a matter of fact, financial institutions of the United States have injected tens of billions of dollars into its auto industry, so it has been conducting unfair trade competition .Industry people analyze the situation will likely be a blow to entire vehicle imports business of auto joint ventures in China. At present, various sides include GM, Chrysler, Ford and other imported car dealers are waiting for the further development of the case in order to make the quickest response.

The United States is one of China's top five car imports countries. According to incomplete statistics, the United States roughly exports 42 thousand cars to China every year. This year from January to July USA has exported 25 thousand cars to China. China Chamber of Commerce for Import and Export of Machinery and Electronic Products’ data shows China's vehicle imports countries include Germany, the United States, Japan, the United Kingdom and South Korea .However, in 2008 imported U.S. cars accounted for 14% of the total amount of imports and 11.1% of the total value of imports. Additionally, imported US auto products mainly consist of Cadillac, Buick, Dodge, Hummer and other auto brands belonging to General Motors, Ford and Chrysler. We can notice the majority of imported entire vehicles are mainly cars and SUV models.

According to a survey, the prices of cars such as Dodge Avenger and some other U.S. cars and SUV have dropped to around 200,000 RMB. Moreover, some dealers even offer less than 200,000 RMB, which is already lower than the price of same level models made by Chinese auto manufacturers.

The only possibility to reverse the situation is the Sino-US Joint Statement signed during Obama’s visit to China. Sino-US Joint Statement rules that China and USA will jointly develop electric vehicle industry. As a good return for both sides, China and USA may be sit down and talk about the matter in the future, however, at least there are no such signs currently. (Translator: Qinghua Wade)

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